Title: Firm Performance Advantage Using Inventory Management Practices Of Selected Firms In The Manufacturing Sector
Authors: ORISHEDE Felix, KIFORDU Anthony, EGBO Albert
Volume: 8
Issue: 10
Pages: 88-106
Publication Date: 2024/10/28
Abstract:
This study examined the effect of inventory management practices on firm performance of selected firms in the manufacturing sector in the South South, Nigeria. The cross-sectional survey research design was employed in this study. The population of this study consists of employees from the production, purchasing, marketing, maintenance, store and accounts departments of 4 selected aluminium products manufacturing firms; Yenagoa Aluminium Manufacturing Company Limited, Asaba Aluminium Company Limited, AGEN Aluminium IndustryAsaba and Ugommalinda Aluminium Company Benin City, in the South South, Nigeria. The sample size of 175 was obtained using Bowley sample size proportional allocation method. A stratified sampling technique was used. The study was driven by primary and secondary data. The data were analyzed using correlation and regression analysis as analytical tools. Findings revealed that Economic Order Quantity inventory practice has significant effect on firm performance with (0.024< 0.05) and Just-In-Time inventory practice has significant effect on firm performance with (0.030< 0.05). The study revealed that inventory practices were not fully utilised as the firms experienced extended lead times when ordering materials and did not avoid obsolescence. The study concluded that Inventory Management Practice is a veritable tool in ensuring and enhancing firm performance over a long period of time. The study recommended that firms should invest in technology to embrace new applications and solutions as they emerge to alleviate challenges that hamper effective inventory management. The study further recommended the automation of all critical processes to achieve efficiency. Automatic alert systems should be installed to manage inventory shelf lives and provide automatic updates on inventory levels as well as to minimize losses caused by obsolescence, stock-out. That management should closely monitor and manipulate their inventory practice to maintain production consistency for firms' profitability and effectiveness.