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The Effect Of Make-or-buy Decision On The Organization’s Profit
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1.5 SCOPE OF THE STUDY
The scope of this research work is based and centered on core areas of make or buy decision i.e who determine what to make or buy and the effect of this decision on the organization profit.
In order to consider the scope of making or buying decision, there is the used to actually know that before purchase orders are raised, a decision is made on whether the item is question is to be manufactured or bought as the case may be.
The basic element involved in the performance of this purchasing function are, obtaining the proper equipment, material and service that are needed and where they are needed at the right price, time, quantity and quantity with minimum effort.
It covers all facts of purchasing in okin Biscuit ltd, Offa. For example, whether the decision has reduced the storage Space or has added to it, whether it aids quick distribution of products, whether quality of product rise or falls with make or buy decision at okin biscuit L.T.D, offa.
1.6 LIMITATION OF THE STUDY
There cannot be any successful research of this nature with out encountering some difficulties which might cause it success or failure. Difficulties in securing some of the vital document containing some valid information relating to the subject matter because of like-worm attitudes of some officers who are suppose to assist in the research work. This occurred with the view that such a research be of immense improvement in their performance.
The researcher also found out that it was not easy to combine the normal class lecture with the writing of this project work hence, time management invariably become a watchword for the researcher. Finally, the research often finds it highly impossible to travel to the firm’s location because of financial constraints
1.7 DEFINITION OF TERMS USED
Make: it is the act of producing certain things.
Buy: is an idea of paid or getting by paying a price
Policies: the plan of action to be taking by management of an organization, policies define the boundaries within which decision can be made and directed towards the accomplishment of objectives.
Decision: it is the act of the making up of mind about certain things.
Capital equipment: is the Installation of equipment such as plant, machinery and other major equipment used directly for production of good and services.
Purchasing policy and procedure audits: this is used to determine if established purchasing policy and procedures are being added here to.
Purchasing: is the continuous management process that is responsible for anticipation, identification and the provision of the good and services that are required by an organization with objectives of increase organization profitability.
Production: it is the process of producing or making an item.
Capacity; Ability to certain, hold or get hold of something.
Unsatisfactory: Not giving pleasure or satisfaction from need or desire.
Specification: Is a definite description of what is wanted.
Supplier: one which responsibility is to supply or make available for further usage either for production or normal consumption.
Standard: it is a model with which something is compared.
Quality: is anything that conforms with one’s pre-determined standard.
Evaluation: evaluation in purchasing is required to ensure that progress is being made towards objectives according to plan. Is part of the control process?
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