THE IMPACT OF INVENTORY CONTROL AND PLANNING IN STORES ADMINISTRATION

THE IMPACT OF INVENTORY CONTROL AND PLANNING IN STORES ADMINISTRATION

abstract

The study will investigate the impact of inventory control and planning in store administration in the fan milk industry of Owerri. The first chapter of this work will look at the introduction, background of the study, research questions, limitations of the study, and definition of terms. The second chapter will look at the literature review, which will introduce many authors and their books, journals, and other publications that will provide their perspective on the topic, while the third chapter will look at the research design, sources/methods of data collection, population and sample size, sample techniques, validity and reliability of measuring instruments, and method of data analysis. Chapter four will discuss data presentation and analysis, followed by hypothesis testing and discussion on

the major findings during the study. Finally, chapter five will summarize all of the preceding chapters, draw a conclusion, and the researcher will make recommendations, list the bibliography, and finally write out the questionnaire questions.

CHAPITRE ONE

1.0 BEGINNING

1.1 THE STUDY’S BACKGROUND

Inventory control is a branch of storekeeping that has been used for a long time. It now has a diverse range of activities. Inventory control is the act of storing valuable items for future use and producing them when needed. Inventory control encompasses more than just keeping and producing items; it also includes operations, receiving, quality control activities, store staff training, and inventory control.

all warehouses, stock handling, and clerical documentation (Ogbu 2016).

According to Victoire (2015), inventory control is the act and science of achieving inventory objectives in an organization. It entails planning, organizing, staffing, controlling, and coordinating all inventory operational activities to ensure efficient service delivery. For optimum performance, inventory control is a serving center, and the services to be provided must be meticulously handled and more organized to meet the demand of all units or departments that comprise the organization. The primary function of inventory control is to provide for efficient inventory and handling of goods to be redistributed to the final user; this activity, when carried out with the use of information technology (IT), will make this activity more efficient.

Material recording is simple because the information is already in the computer. The use of information technology in inventory control eliminates time waste. This contribution to the operating function must be fully recognized. All other activities, while important in their own right, are subordinate to this primary responsibility. The above central goal can be broken down as follows:

i. To provide a balanced flow of raw materials, components, tools, equipment, and any other item required to meet operational needs.

ii. To supply maintenance materials and spare parts to general stores as needed.

iii. Receive and distribute work in progress and finished goods

iv. Accept and store scraps and other materials as they come in.

v. Account for all receipts and payments

product availability in the store

Thus, in any institution, private or public, a significant amount of money is spent on the acquisition of materials and equipment, which are then stored in a warehouse for future use. These items are worth the same as cash and must be protected from unauthorized use until they are used for their intended purpose and properly accounted for (Tarus, 2015).

Keeping inventory incurs significant costs, despite the fact that we must keep stock to meet production and sales requirements. This is because if we do not keep enough stock on hand, we risk running out of stock and incurring all of the costs associated with stock out. As a result, for an

To avoid the aforementioned problem, organizations must strike a balance between carrying too much stock (overstocking) and carrying too little stock (under stocking) Profitability cannot be overstated because it is the reason why organizations exist. If inventory control is carried out properly, there will be an increase in production and sales, resulting in increased profitability for the organization (Shardeo, 2015).

There, this study attempts to determine how inventory can be effectively used to reduce time waste, theft, obsolescence, and pilferage in the organization in order to achieve their profitability goals.

1.2 PROBLEM STATEMENT

Inventory control and planning have an impact on fan milk ice cream. The company is battling Owerri.

a slew of issues ranging from stockpiling materials, which must first be purchased from suppliers and remember that in many cases the goods must be paid for with the organization’s working capital. As a result, the impact of inventory control becomes an issue.

1. The firm is battling the unavailability of materials in stock in the sense that they frequently operate on a hand-to-mouth basis, making the impact of inventory difficult.

2. Because stock is sometimes allowed to leave the store without proper request, the impact of inventory is complicated.

3. Overstocking causes deterioration and pilferage, making it difficult to influence inventory control and planning in the firm.

4. Because optimal stock levels are difficult to determine, it is difficult to influence inventory control and planning in the firm.

5. The use of inexperienced store administrators, resulting in insufficient inventory control and planning (Oso, & Onen, 2015).

1.3 STUDY OBJECTIVES

The primary goal of this study is to evaluate the impact of inventory control and planning in store administration. Other specific goals include:

1. To emphasize the enormous/importance of effective stock planning and control in store administration.

2. Identifying and resolving stock management and control issues in the store administration.

3. Identifying the likely consequences of overstocking and understocking planning and control in store administration, as well as the benefits of having stock on hand

It is at its best.

4. Whether there is a misalignment between policy and practice in the fan milk industry in Owerri.

5. Ensure that a qualified store administrator is employed in the organization’s store to improve inventory control and planning.

1.4 QUESTIONS FOR RESEARCH

The research questions are as follows:

1. Does store management recognize the significance of efficiency, inventory control, and planning?

2. Does overstock incur unnecessary carrying costs and capital ties?

3. Is the impact of inventory control and planning important to store management?

4. Does understocking result in stock outs in store management?

5. What effect does stock/inventory have on the organization’s profitability?

1.5 THE IMPORTANCE OF THE STUDY

Although it depends on the useful guide for a research work, the success of largely projects and programs envisage for sustained inventory control and planning in store administration because inventory forms the life blood of any organization set-up.

The research work will serve as a resource for researchers interested in how to manage and control inventory in a rapidly growing industry. However, the researcher believes that the information gathered from this research will assist employees of concerned Nigerian companies in determining whether their method of inventory control and planning is having an impact in their company.

It will also examine whether the inventory control and planning procedures ensure the success of inventory control and management.

In their company, they have a planning system. It will educate the public on inventory control and planning procedures in the establishment. It will also highlight the work points of the current procedure. The reader may benefit from thinking about inventory control and planning as they see it in their own environment.

1.6 STUDY OBJECTIVES

This study will examine the need for effective stock control and store administration planning. In general, but with special emphasis on the Fan Milk Industry in Owerri. This is done to learn how the company has been able to control and plan her stock, as well as achieve her goals.

1.7 THE STUDY’S LIMITATIONS

During the course of this work’s research, the researcher came across

Difficulties in gathering responses from respondents, the location of the case study organization, and the difficulty in delivering what is commonly referred to as the organization’s secrete by respondents. Despite the difficulties, the researcher was able to obtain the necessary information.

1.8 TERM DEFINITION

Some technical terms purely related to the topic are used in this research work for easy comprehension, and the work is explained below:

Ordering costs include the cost of preparing a purchase order or production order, as well as special processing and receiving costs based on the number of orders processed.

Carrying cost: The cost of carrying the desired rate of return on inventory investment as well as the cost of storage, breakage, obsolescence, deterioration, insurance, and personal property.

taxes.

Economic order quantity: The size of inventory that will result in the lowest total and annual cost of the items in question.

Recorder level: This is the print or level that initiates a new order. It is determined by the anticipated usage during the lead time.

Safety stock: This is the stock set aside to meet customer demand for new materials in the event of unexpected usage beyond normal usage. The goal is to keep the company from running out of stock at the same time.

Lead time is the time it takes from when a need is identified to when an order is placed and the requirement is gathered and delivered to the buyers.

Stock: A quantity of goods or anything kept or stored for use as needed, particularly raw materials, work-in-progress, and finished goods from suppliers.

Stock control is the activity or study of stock to ensure that the quantities of stock, raw materials suppliers, or finished goods are such that a satisfactory level of service is maintained for all stock keeping units while holding costs are minimized.

A stock holder is a company or individual who owns a specific type of stock, such as wholesalers who own manufactured goods.

The stock level (or inventory level) is the level at which sales are kept.

Stock out: This is the state of having stock or materials on hand for a period of time, for example. The monthly rent of

Storage space, a storekeeper’s salary, and the cost of sock records are all factors to consider.

Stock card: This is the measurement of the quantity of stock that an enterprise has in order to obtain an accurate inventory list.

Stock turnover is the ratio of a firm’s sales revenue for a person of average goods during that period.

Obsolete: This is simply the state of being out of date.

Obsolete: The state in which a given product or material is no longer in use due to the invention of a new product or material.

The minimum stock level is the limit that stocks cannot exceed.

This is a classification mechanism that uses a systematic approach.

Stocks are listed in ascending order of importance.

Bulk purchase: This is when you buy in large quantities.

Deterioration is the reduction in the residual value of a product’s assets, materials, and so on.