THE EFFECT OF MATERIALS MANAGEMENT ON THE PROFITABILITY OF AN ORGANIZATION. (A CASE STUDY OF CHAMPION BREWERIES PLC UYO, AKWA IBOM STATE)

THE EFFECT OF MATERIALS MANAGEMENT ON THE PROFITABILITY OF AN ORGANIZATION. (A CASE STUDY OF CHAMPION BREWERIES PLC UYO, AKWA IBOM STATE)

CHAPTER ONE

• INTRODUCTION

Materials managements is a salient or the projecting part but an important function in any manufacturing company, whether service or production industries. Where proper attention is according to this very important function in an organization, the result is laudable or commendable.

In materials management today, the major challenge that material managers are  faced is maintaining a consistent flow of materials for production. There are many factors that   inhibit the accuracy of inventory which results in production shortages, premium freight, and often inventory adjustments. The major issues that all materials managers face are incorrect bills of materials, inaccurate cycle counts, unreported scrap, shipping errors, receiving errors, and production reporting errors materials managers have striven to determine how to manage these issues in the business sectors of manufacturing since the beginning of the industrial revolution. Although there is not known methods that eliminate the aforementioned inventory accuracy inhibitors, there are best methods available to eliminate the impact upon maintaining interrupted flow of materials for production.

One challenge for materials managers is to provide timely releases to the supply base on the scale of worst to best practices, sending releases via facsimile or file for the worst practice and transmitting releases to the supplier based web site is the best practice, why? The flaw in transmitting releases via facsimile or file is that they can get lost or even interpreted incorrectly into the suppliers system resulting in a stock out. The problem with transmitting and releases system capable of receiving the product information. The best practice is to transmit and release goods to a common supplier.

1.2   BACKGROUND OF THE STUDY

Materials management is defined as placing organizing and         controlling of the flow of material from the initial purchasing through the internal operation to the distribution of  finished goods. From the above definition one clearly understands that the function of materials management embraces, purchasing of buying of materials, control via production and inventory management.

This includes receiving, shipping, materials handling, counting and inspection warehousing and distribution.

Materials management is a field of management that focuses on all aspect of obtaining and handling the tangible inputs and outputs of production processes material management includes responsibilities such as procurement, waste disposal, hazardous materials, accountability quality assurance and control, setting standards, and cataloging inventory also called materials planning.

1.3   STATEMENT OF THE PROBLEM

Materials handling in manufacturing organization is an important aspect of production process many companies engage diverse strategies to achieve organizational goals through materials management. the control of materials handling as it affect champion breweries Nigerian plc is the unavailability of materials in stored and  proper reconciliation of possible loss to business through interruption of production or failure to meet orders with the handling cost of stock.