THE EFFECT OF MATERIALS MANAGEMENT ON THE PROFITABILITY OF THE MANUFACTURING COMPANY

THE EFFECT OF MATERIALS MANAGEMENT ON THE PROFITABILITY OF THE MANUFACTURING COMPANY

(A Study of Cadbury Nigeria Plc)

ABSTRACT

This research was to examine The Effect of Materials Management on the Profitability of the Manufacturing Company with special reference to Cadbury Nigeria Plc. This study show with statistical evidences that materials management significantly increase the profitability, wellbeing and productivity of the organization. The research methodology adopted has the limitations peculiar to the use of questionnaire like, the uncooperative attitude of respondents, slow pace of instrument retrieval, etc. Although the study adopted the use of simple languages, but some respondents still found it difficult to understand some concepts and they had to be put through, so much time is wasted in the course of doing this. Finally, the opinions of the respondents form the basis of this research, but this did not in any way affect the quality of the study.  Simple percentage distribution was used in the presentation and interpretation of the data collected. To this end, the data were tabulated in a frequency distribution form and the corresponding percentage equivalent were calculated and recorded respectively. To test the hypotheses earlier formulated, the chi-square statistical method was also adopted.Materials management should be handled through the act of directing and controlling the acquisition and usage of materials in the organization and it should be seen as the most important resources for any organizational production. Without the materials, no one can do anything. In the light of field discoveries, the information gathered will assist the management of any organization in general and Cadbury Nigeria Plc in particular, in taking appropriate steps of inculcating means of managing materials as parts of the prerequisite for improving organisational productivity.

TABLE OF CONTENT

                                                                                PAGE

Title Page                                                                                i

Certificate                                                                               ii  Dedication                                                                              iii      

Acknowledgement                                                                  iv
Abstract                                                                                  v

Table Of Content                                                                    vi

CHAPTER ONE: INTRODUCTION

1.1       BACKGROUND TO THE STUDY                                           1

1.2   STATEMENT OF THE PROBLEM                                           4

1.3    OBJECTIVE OF THE STUDY                                       5

1.4    RESEARCH QUESTIONS                                                       5

1.5   SIGNIFICANCE OF THE STUDY                                            6

1.6       RESEARCH HYPOTHESES                                                   6

1.7       SCOPE AND LIMITATIONS OF THE STUDY                        8

1.8       OPERATIONAL DEFINITION OF TERMS                    8

CHAPTER TWO: LITERATURE REVIEW

2.0    Introduction                                                                           10

2.1    Historical Background Of Nestle Nigeria Plc                       10

2.2    Conceptual Framework                                                        11

2.2       The Relationship Between Materials Management

And   Profitability                                                                   15

2.3    Materials Requirements Planning and Capacity Requirements   17

2.4  Theoretical Framework                                                            22

2.5   The Planning Decisions and Approach in Materials         

        Management                                                                            25

2.6   Production Utilities in Materials Management                      27

2.7 Customer Satisfaction as It Relates to Materials Management       29

2.8Material Availability in Materials Management               30

2.9    Purchasing And Inventory Policy in Materials Management 35 2.10  Time of Purchasing In Materials Management           37

2.11  Source of Purchases of Materials                                         38

2.12  Summary of Literature Review                                              42

CHAPTER THREE: RESEARCH METHODOLOGY

3.0    Introduction                                                                                     43

3.1    Research Design                                                                    43

3.2     Population of Study                                                               43

3.3    Sample and Sampling Procedure                                          44

3.4     Data Collection Instruments                                       45

3.5    Data Analysis                                                                         46

CHAPTER FOUR: DATA ANALYSIS AND INTERPRETATIONS

4.0    Introduction                                                                           47

4.1    Respondents’ Characteristics and Classification                47

4.2    Presentation and Analysis of Data According To Research Question                                                                                51     

4.3    Presentation and Analysis of Data According to

Test of Hypotheses                                                                 57

CHAPTER FIVE: SUMMARY, CONCLUSION ANDRECOMMENDATIONS

5.0    Introduction                                                                           64

5.1    Summary of Findings                                                             64

5.2    Conclusion                                                                                       68

5.3    Recommendations                                                                  69

References                                                                              71

Appendix                                                                         74

CHAPTER ONE

INTRODUCTION

1.2       BACKGROUND TO THE STUDY

Over the last decade, our world has changed dramatically due to the growing phenomenon of globalization and revolution in information technology. There is tremendous demand on companies to lower costs, enlarge product assortment, improve product quality, and provide reliable delivery dates through effective and efficient coordination of production and distribution activities. To achieve these conflicting goals, companies must constantly re-engineer or change their business practices and employ information systems (Mahesh, 2006).

Materials Management has always been an area of scrutiny for organizations. This has become a central focal point as trends from the supply chain arena have indicated that substantial operating cash can be freed with leaner and more efficient handling of inventory.

As organizations examine the state of their inventory, they often find that visibility across locations and warehouses are inadequate, stock levels are inconsistent, demand is uncertain, and communication between stocking locations or warehouses may be minimal or non-existent. Among other things, the lack of an integrated interaction between peripheral systems and materials managers leads to unnecessary purchasing and overstocking.

The concepts of “materials mana