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EFFECTIVENESS OF INVENTORY MANAGEMENT IN A MANUFACTURING COMPANY (A CASE STUDY OF AMA GREENFIELD BREWERIES PLC, ENUGU, NIGERIA)

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ABSTRACT

This study examines the essence of effective inventories control and management to manufacturing companies with particular emphasis on Ama Greenfield Breweries plc. The aim of this study is to investigate and ascertain areas of lapses by the company and offer effective ways and solutions in which the manufacturing company can explore the services of inventory management to effect its objectives. In carrying out this study, various research instruments such as questionnaires and oral interview were used to collect data from respondents and a research design was adopted with a sample size of 52. The statistical tool used for this work is Chi-square. Based on the analysis, it was discovered that inventory management plays a vital role in the manufacturing company. A well functional inventory management following the recommendations can bring about proper management thereby enhancing proper and effective production and it will equally ensure the effective, efficient and adequate use of materials and resources in the manufacturing company.

TABLE OF CONTENTS

Title page – – – – – – – – -i
Approval page- – – – – – – – -ii
Dedication – – – – – – – – – -iii
Acknowledgement – – – – – – – -iv
Abstract – – – – – – – – -v
Table of contents – – – – – – – -vi
CHAPTER ONE
1.0 Introduction – – – – – – – -1
1.1 Background of the study – – – – – -1
1.2 Statement of the problem – – – – -5
1.3 Objective of the study – – – – – -6
1.4 Test of hypotheses – – – – – – -6
1.5 Research questions – – – – – – -7
1.6 Significance of the study – – – – – -8
1.7 Scope of the study – – – – – – -8
1.8 Limitation of the study – – – – – – -9
1.9 Definition of terms – – – – – -9

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CHAPTER TWO
2.1 Introduction – – – – – – – -11
2.2 Concept of inventory- – – – – – -11
2.2.1 Types of inventory- – – – – – – -13
2.3 Classification of inventories – – – – – -15
2.4 Inventory policy- – – – – – – -16
2.4.1 Reasons for inventory – – – – – – -17
2.5 Inventory control – – – – – – – -19
2.5.1 Purposes of inventory control – – – – – -21
2.6 Cost associated with inventory – – – – -21
2.7 Inventory model – – – – – – – -25
2.8 Economic order quantity – – – – – -26
2.8.1 Replenishment model- – – – – – -28
2.9 Inventory level – – – – – – – -28
2.10 Inventory valuation method – – – – – -30
2.11 Inventory Accounting System – – – – – -33
2.12 Stock taking methods- – – – – – -34
References – – – – – – – – -35

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CHAPTER THREE
RESEARCH METHODOLOGY
3.0 Introduction – – – – – – – -36
3.1 Research design – – – – – – – -36
3.2 Area of the study – – – – – – – -36
3.3 Population of the study- – – – – – -37
3.4 Determination of the sample size and technique- – -37
3.5 Sources of data – – – – – – – -40
3.6 Method of data analysis – – – – – – -40
3.7 Validity of the test – – – – – – -41
3.8 Reliability of the test – – – – – – -41
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS – – – –
4.0 Introduction – – – – – – – -43
4.1 Presentation of data- – – – – – -43
4.2 Analysis of data – – – – – – – -44
4.3 Test of hypothesis – – – – – – -54

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CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary of findings- – – – – – -58
5.2 Conclusion- – – – – – – – -61
5.3 Recommendation – – – – – – – -62
Bibliography – – – – – – – -65
Appendix- – – – – – – – -68

CHAPTER ONE

this study lies on the fact that with improved
inventory control and management in manufacturing companies, the
following persons may benefit from it:
It will be significant to manufacturing companies, firms and
businesses as it will enable them keep an adequate inventory control and
ensure that they do not run out of stock or have excess stock which can
endanger their liquidity position. It will also help to meet consumer’s
demands or quest. It is also important to the government as it will help to
reduce waste of investment inventory. It will also help lecturers to really
know the importance of inventory control so that they will be able to impact
it on their students. This study will also reveal the relevant methods to be
used in preventing mismanagement; it will also improve stock control which
has led to the mismanagement and unproductively of materials.

1.7 SCOPE OF THE STUDY
This research work on the effectiveness of inventory management in a
manufacturing company is focused on Ama Greenfield Breweries plc in
Enugu state.

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1.8 LIMITATIONS OF THE STUDY
Some limitations and factors in this research study are as follows:-
i. The time required for the research and the submission of this work
is very short and the researcher was unable to go through all
manufacturing companies.
ii. Financial constraints:-Finance which is the most important
resource for this work was not readily available.
iii. Limited exeat:-Due to the fact that exeat is very difficult to get in
school, proper research was not carried out and this affected the
integrity of the results achieved.
iv. Unco-operative attitudes of some of my respondents:- The
management of Ama Breweries prohibited its employees from
giving out information about the company to outsiders without
adequate permission from the management and even when this
permission was obtained at the long run, many vital information
were not revealed because they were regarded as the privacy of the
company.

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1.9 DEFINITION OF TERMS
INVENTORY:This is a record of a business’ current assets. It can also be
described as the merchandise or supplies held or in transit at a particular
point in time.

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