Open AccessProcess Inventory Management in a Production Company
Author(s) -
Paul A. Ugboya
Publication year - 2019
Publication title -
journal of advances in sciences and engineering
Language(s) - English
Resource type - Journals
ISSN - 2636-607X
DOI - 10.37121/jase.v2i1.42
Subject(s) - economic order quantity , profit (economics) , production (economics) , operations management , bottling line , inventory management , materials management , business , safety stock , production manager , finished good , variance (accounting) , stock (firearms) , operations research , computer science , economics , engineering , marketing , accounting , supply chain , microeconomics , mechanical engineering , bottle
This paper analyses the economics of material management in the 7up Bottling Company, Benin for the duration (2011 – 2015) with a view of designing a process inventory. The specific objectives were to determine the level of efficiency and product improvement in material management, investigate whether the material management practice permit high stock turnover validation and to proffer useful suggestions on how to effectively manage the company materials. The variance analysis and Economic Order Quantity (EOQ) model were used to analyse the data collected. The results showed that the company spent a total of 118.8 million naira for production process and made a total sale of 395.84 million naira. This implies that the company optimises production by adopting the EOQ model into their production process and management. Based on these findings, the study recommends that optimal quantity and timing of material ordering in production process is a key to profit maximisation.