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Purchasing Research As A Tool For Profitability In The Service Industry
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There are certain factors in service industry especially in insurance
companies that affect the profitability of the firm such as the impact
of legislation and tax concession, size and distribution of population,
national income, competition, inflation, use f mass merchandising,
packaging policy approach etc it is through purchasing research that
these problems will be solved and thus bring profit to the company. The
success of any business firm depends to a great extent on the efficiency
and aggressiveness of the entire purchasing organization operations,
and the effectiveness of the management, working together as a team,
towards the accomplishment of the specific and broad corporate goals and
objectives.
AIICO insurance company a service industry was
established in 1963 as a collection centre, and incorporated in 1970,
converted to a public liability company in 1989 and was listed on the
Nigeria stock exchange with effect from 3rd December, 1990. To date,
AIICO has become the highest life insurance in Nigeria and a major
underwriter for general insurance business. The company’s success has
been the result of its ability to evaluate its potential set realistic
goals and take necessary action to achieve them. They have a separate
purchasing department and a research department that undertake the
purchasing research work. These activities have to a large extent
influenced the overall performance of AIICO insurance company Nigeria.
1.2 STATEMENT OF THE PROBLEM
Despite
the large market potentials in service industry and its competitive
nature in Enugu State, many companies and business still find it
difficult to develop an appropriate offering that will serve the market
satisfactorily.
ALLCO insurance company faced very stiff opposition
from other insurance companies especially other foreign owned insurance
brokers and agents at its on set due to fear of the uncertain effects
that its entry into the industry might cast on their business prospects,
thus were reluctant to assist the company.
Also, the level of
insurance awareness in the country is still very low, at present about
10-15 percent of the Nigerian population are insured, unlike developed
countries this resulting in low productivity and profitability.
Consequently,
there have been allegation of AIICO insurance company not compensating
the unfortunate policy holders, all these have resulted in negative
attitude towards their services, thus have resulted to loss in profit.
This research takes an in-depth look at this allegation and other pro
problems in other to proffer an amenable attitude towards AIICO
insurance company.
CHAPTER ONE -- [Total Page(s) 4]
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