THE EFFECT OF INVENTORY MANAGEMENT ON THE PERFORMANCE OF SELECTED FIRMS

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THE EFFECT OF INVENTORY MANAGEMENT ON THE PERFORMANCE OF SELECTED FIRMS

Abstract:

The purpose of this study is to evaluate the inventory management and control in manufacturing firms. The specific objectives are to: examine the contributions of effective inventory management to the profitability of manufacturing firms, determine the effects of improper inventory management on the productivity of manufacturing firms and assess the effectiveness of the various tools and technique of inventory management in manufacturing firms. This study adopted descriptive research design. The area of the study is manufacturing firms’ precisely Seven Up and Green Cork Seals in Lagos State. The instrument used for this study is from primary data. The primary data was obtained through properly structured questionnaire. A simple percentage approach was employed to analyze the questionnaire. The study found that the inventory management and control has contributed to profitability in manufacturing firms examined. Also, the findings reveals that the various tools and techniques of inventory management adopted in manufacturing firms are effective; and that improper inventory management will affect the productivity of manufacturing firms. The study recommended that the manufacturing firms should diversify their inventory system to suit specific needs of production and at the same time ensure that maximum attention is paid to inventory management so as to avoid or reduce the amount of loss that would be gotten from damaged goods in inventory. This study concludes that the various tools and techniques of inventory management adopted in manufacturing firms are effective and inventory management has significant impact on manufacturing company.

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