Inventory Control and Performance of Manufacturing Company

ADEMOLA, EMMANUEL AKINYELE AND OYELEYE, TEMIDAYO FLORENCE

Department of Accountancy

Federal Polytechnic Ilaro Ogun State

Email: demoladelord2003@yahoo.com

ABSTRACT

This paper examined the cost benefit analysis of inventory control in manufacturing industries and to known the effect or challenges facing manufacturing companies and how it can be handled. The researchers made use of secondary data from SOSACO Nigeria Plc. The method used monthly descriptive EOQ (economic order quantity) model, to determine the optimal order quantity via the used of Economic Order Quantity (EOQ) which is an optional policy that would provide adequate inventory level when needed at the minimum total   cost of ordering cost and the Economic Production Quantity (EPQ) which is the quantity demand of goods produced by the company to the economic. The method that was used to analyze  this data  was the EOQ model and EPQ model It was discovered that though the companies guide against ordering material that will effectively minimize the cost in an optimal way nevertheless the manufacturing companies could still do better if all cost that is associated to the production are minimized. The conclusion on this, show that the survival of any company manufacturing organization depends, to some extend on the inventory level being kept by the company. The recommendations  made is that the company should adopt the EOQ and the EPQ model so as to adequately tackle the problem of sub-optimization, which result when the factor is under-utilize.