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Nventory Policy As A Tool In The Attainment Of Organizational Goals
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The need for a proper inventory
policy cannot be over emphasized. It could be seen with various benefits
associated with sound inventory policy. Good inventory and management
achieve the aim of making inventories act as cushions for absorbing
planning errors and unforeseen fluctuations in supply and demand and
facilitating smooth production and marketing operation.
Furthermore, inventory has help in isolating or minimizing the
interdependence of all parts of the organization so that each may work
effectively by manufacturing or purchasing many parts and such assembles
to be stored and used s needed.
In the light of the above,
it should be seen that a good policy helps in attainment a required
amount of sales and this sales turnover help in achieving profit
maximization which of course is the aim of most organization. inventory
policy can be used by organization of all sizes. A proper inventory is
the first in achieving organization goal but often policies taken by
organization are dangerous that doubt arises of whether there is any
policy by organization are dangerous that doubt arises of whether there
is any policy at all.
1.2 STATEMENT OF THE PROBLEM
It has always
been asserted that inventory policy involved control, planning and
investment and maintenance of inventory for the successful production
sales and adequate and prompt service to customers. There is further
assertion that without a solid and proper inventory policy, a company
cannot be able to achieve aims to which they are set up.
Despite this assertion, the researcher observed that many productive
companies have no proper inventories policy and maintaining huge profit.
The researcher further observed that these companies have no definite
policy for maintaining adequate inventory policy to which the
organization is set up.
Sub Problems
With the introduction
of structural adjustment programs SAP the cost o acquiring money is
very high. This has made manufacturing part of the company investment
which is being in inventory be it raw materials, spare parts, and
finished goods. In recent times, it has been found out that there has
been an increased profit through high sales with increasing cost of
carrying cost management is watching purchasing decision more closely
and one cannot afford to let materials or inventories remain idle in the
store house.
The emphasis now was in the integrity function
of materials management and taking account of the value of money. More
so, inventory policy is to maximize profitability in balancing inventory
investment against what is required to sustain smooth operation. The
executive of most manufacturing companies view inventory management a
times as unnecessary drain on resources which should not be given much
more time. Their problem being that forget that the most neglected
inventory are also the most expensive to keep in stock.
This negligence has led to some manufacturing companies to be closed down like African Breweries Ibadan and a lot more.
The arbitration imperfection and indiscretion of the management
personnel charged with responsibility of inventory planning and control
cannot be overlooked. The fund invested in inventories could be used in
making investment in other areas that will yield quicker and greater
returns and enable the company to enjoy the benefits of time value of
money.
CHAPTER ONE -- [Total Page(s) 3]
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ABSRACT - [ Total Page(s): 1 ]Inventories policies in manufacturing companies has been a great assistance towards the attainment of organizational goal which aim not only helping the sustenance of manufacturing industries or setting it on a going concern and thereby fostering long term profitability through one of the problems that indeed usually confront manufacturing companies is how to maintain and value their inventories and by so doing achieve opinion inventory. The importance of inventory policy in the attainment of or ... Continue reading---
