Project Materials

CONTRIBUTION OF STOCK CONTROL IN THE ATTAINMENT OF ORGANISATION OBJECTIVES GOALS

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

Stock control is an essential area quantity that is frequently overlooked and undervalued in many organisations, both public and private sectors. Stock control is a method of making the correct quantity and quantity available as needed while taking into account the economy of storage and ordering costs, purchasing prices, and working capital.

Stock control thus entails the act of

1) assessing the things to be held in stock

2) determining the extent of the holding of such products, whether individual or collecting

3) Regulating the intake of stock into storehouses and

4) regulating the output of stock. To enable the stock controller to analyse the products to be held in stock, he must consider what items are being utilised and produced by the specific company, and then select which of those items to stock.

Stock is primarily held to provide a reservoir of materials to absorb vanation effort in both delivery and consumption, as well as to maintain supply availability within the organisation. Naturally, supplies that are frequently utilised must be kept on hand, as well as those that may be required on short notice in the case of a plant failure.

We can define or describe stock control as the process of making materials or items of the correct quality and quantity available when needed while keeping storage costs, ordering costs, and working capital in mind.

Stock control can also be described as the function of planning and maintaining the right quantity of items for a given production or sales programme with the least amount of investment.

i) Stock control includes the following objectives or items in the manner and quantity required at the designated period. ii) To limit the amount of things that must be carried, etc.

In order to achieve those goals, stock control employs a variety of ways that can be managed by quantity and value. It is desirable to have control over value. Stock control in quantity is simply required to provide an accurate result for each item that is kept at the appropriate level.

1.2 Statement of the Problem

Certain conditions or factors might lead to effective or poor stocking and verification. The problem of this study is to eliminate the following:

• A lack of adequate inventory management, which indicates the physical balance of items in the manufacturing organisation.

• The company’s stock level and item paperwork are not being applied properly.

• Items are closely situated within the company, exposing them to deterioration and transportation. This creates waste, which has a significant impact on the company’s profit maximisation.

Despite the importance and benefits of stock taking, there are sometimes drawbacks. As a result, the purpose of this study is to identify the elements that work against effective and efficient stock control in order to improve performance.

1.3 PURPOSE OF STUDY

It is vital to look back in order to appreciate what we are doing now so that we can do better in the future. Stock control has existed for a long time without being realised by the individual or the cooperative purpose.

Subsequently, research has been conducted based on the effective application of stock control principles, techniques, and practices in various organisations with the goal of achieving a healthy economy in the organisation in order to achieve effectiveness and efficiency in an organisation of any size or scope.

The goal of this research is to demonstrate the underappreciated but significant role of effective stock in an organisation.

The following objectives need to be reviewed:

• Determine the level of interference by the employee or any of his sons in carrying out their business.

• Conduct an analysis to establish the degree of effective stock control in a manufacturing organisation.

• Space utilisation was accomplished.

• Examine how the optimal safety stock level is determined and maintained.

1.4 Significance of the Study

The study will benefit the following individuals or groups of people.  The government can monitor resource management and control in the public sector.  Public Sectors: This study highlights the importance of proper stock control in organisations.

The Stock Manager will identify areas for inventory management and control.  Management will have access to stock control information to ensure the organization’s targets are met.

Successful completion of the conditional diploma certificate in Purchasing and Supply qualifies researchers for a higher national diploma, allowing them to practise their profession.  This study will benefit other students who desire to conduct additional research on comparable themes.

1.5 RESEARCH QUESTIONS.

The research question for this project will be based on the following.

1. What establishes stock regulation in the PZ business

2. Who is responsible for ordering raw materials in the PZ industry?

3. What determines the number of raw material orders?

4. Has the PZ industry ever had excess stock?

5. Has the PZ industry ever experienced a shortage of stock?

1.6 Statement of Hypothesis

The following hypothesis is proposed to guide the study’s goal.

1. H0: Keeping a large supply of material does not result in unnecessary ordering costs, obsolescence risk, or funds being tied up in inventories.

H1: Holding large stocks of materials introduces needless ordering costs, obsolescence risk, and tied-up fund inventories.

2. H0: Understocking of raw materials disrupts manufacturing and leads to lost revenue.

H1: Understocking of basic materials disrupts manufacturing and leads to lost sales.

1.7 SCOPE OF THE STUDY

This study is intended to provide insight into methods for solving research difficulties. The difficulties of inappropriate stock control application in PZ Industry Nigeria Limited, and it will be hard to analyse all of them within the time frame specified in the research.

As a result, the researcher chose PZ Aba as the case study to conduct a thorough investigation of stock control in that company.

1.8 Limitations of the Study

The study is limited in some ways. First, the research was conducted concurrently with my comprehensive lecture on the researchers’ preparation for the final examination; as a final-year student, it became difficult to balance both the research work and other academic activities.

Other study limitations include time, finances, non-response, and distance. Time: knowing fully well that the researcher is still a student with much academic work load, and as this project work has not been given any specific period in the researcher’s class timetable, the research has constrained to limit his areas of coverage so as to fall within the little time allowed and available.

Finance: Given the country’s and the world’s poor economic position, do not anticipate the researcher, who is still attached to his parents’ nprons strings, to effectively carry out this research, which will require a significant financial investment.

The lack of funds also had an impact on the research area, as the distance could not be tracked. Non-Response: This was the study’s largest limiting element. The investigation, which was conducted in the PZ manufacturing business Aba, had relatively few employees with suitable information to provide

while others were unwilling to compromise their job commitment with the information requested by the researcher. Distance: The researcher’s area is far from the school, which hampered his efforts. With all of this, the researcher attempted to complete their project task satisfactorily.

1.9 Definition of Terms

 Stock control is the process of ensuring materials are available in the appropriate quantity while minimising storage and ordering costs, purchasing, prices, and working capital requirements.

 Replenishment: The process of refilling something by replacing what has been used.

 Deterioration refers to changes in amount or condition.

 Inventory refers to the total amount of items or materials in a storehouse at any particular time.

 Material control is the portion of the stock organisation responsible for controlling the flow of production materials, typically from the supplier’s production centre.

 Interference: Attempting to affect an unrelated situation in a way that irritates others.

 Stock out costs: There are expenses connected with running out of stock. The main reason for these expenses is the core reason why stock is held in the first place.

In other cases, these costs include cost contributions from lost sales due to workforce discontent. Over stop pages. Extra cost associated with urgent, typically low quality

Ordering Cost: This term refers to the whole cost of raw material (supply) activities, including requisitioning, purchasing, ordering, transportation, receiving inspection, and storage (store placement). The cost of ordering increases proportionally with the number of orders.

 Stock refers to the supplies and commodities required for commercial operations.