1.0 Introduction
In the recent part, emphases was only on the balance sheet report without cognizance of other factors that made up the inflow and outflow of resource that sustain the mechanism of a given firm. with recent emphases on cost control in the face of the rising cost of input resources and subsequent spill over of high cost of purchasing and supply management in a manufacturing company.
After the civil war, the attendant from in production resulting from the growth of private sector enterprises from Europe and America began to awaken other management inputs for eventual profit. The reason is based on the sophisticated resources part in by these multinationals into the mechanism of our business sector.
It is imperative to note that the concept of purchasing has been broadened since the turn of the country, to include all those business activities relevant to the securing of materials suppliers and equipment as well as service needed by business and industries.
As at date, the cost of materials and supplies for industrial and non-industrial purposes accounts for a large proportion of the cost of these manufacturing company. In most of them, this represents over 65% of their total expenditure (Oyeoku O.K. 1993).
Therefore, purchasing is referred to as department which is concerned with the process of defining the manufacturing company's needs selecting suppliers, agreeing terms placing orders receiving goods and function which is oriented to purchasing complete supply function which is user within the manufacturing company (R.E.J. Nwanneka).
English Oxford Advanced Learners Dictionary of current English, third edition, simply defined the world purchasing as just buying. We will however, take purchasing mission to be selection of materials or services agreement of prices and acquisition items. A well organized purchasing is one of the criteria for a company to minimize cost at the same time increases profit.
The impact of purchasing and supply management towards ensuring repaid growth in a manufacturing company's cannot be over emphasized. It has been sampled and proved that, a layman in the field of purchasing easily views purchasing function as obtaining requisitions negotiating and placing order without the knowledge that purchasing goes beyond this areas of activities.
For a company to succeed or to achieve its desired objectives, it means that those required manning the materials section of the manufacturing company should be highly trained and knowledge in the field of purchasing. And other materials related functions, in order to harness effectives and efficient profitability to their manufacturing company. In view of numerous challenges of the profession requires a caber of persons that can exercise prudence and sound judgment for any naira spent at ay given point in time, in order to minimize cost and increase profit.
Sincerely speaking, these cannot be achieved of the buyer is not a professional buyer that should adhere, strictly to the ethics of the purchasing profession and techniques of purchasing practice. Quite unlike untrained buyer, a trance and professional purchasing executives is aware that he is bound by the ethics of the purchasing profession.
Therefore, his first and primary obligation is integrity in spending his company's fund, showing professional competence in representing his manufacturing company outside etc. it is in line with this that the researcher tends to study the impacts using Nigeria Breweries company plc.
1.1 Background of the Study
This general introduction cannot conclude without giving a brief description of the company used in this research.
The Nigeria Breweries plc in Nigeria dates back to thirties and is an imported technology, the indigenous drinks in Nigeria include palm wine, pitokaika, brukutu etc. through strike new in some quarters, beer is gradually replacing these traditional drinks in celebrations such as marriage, birth, ceremony, funeral which were seldom celebrated in the past beer.
The only way these indigenous drinks were promoted in the past was by the testing method, consumers then were allowed and even now to take various palm wine brought to the market by different producers and sellers and it s served as a means which determine consumer patronage decision. This is because palm wine and burukutu were generic not until recently that they were being branded. Bottled beer was firstly marketed in Nigeria by the Nigeria Breweries limited launched in 1949, thus marked the beginning of a buoyant industry that at present markets about six (6) brands of alcohol and non alcohol beverages.
Today social norms as they related to the use of alcohol in ceremonies have changed and beer is used instead. In some cases, they are exclusively used while in other for example social clubs, a particular brand may be favoured by established norms. The beer industry in Nigeria presently has matured into an interesting competitive market with about 28 brands of beer brewed by more than 27 breweries.
Nigeria Breweries plc, Aba makers of star beer, Guilder Maltina etc has embarked on many sales promotional activities of strategies have had a lot of impact on purchasing and supply management.
As reliably gathered these products do not have the problem other competitors products do have is because of well organized sales promotional activities. This is in line with saying that a community that sees it benefiting from a particular is bound to patronize such company.
1.2 Statement of the Problem
The high inflationary trends records in Nigeria I recent times are never a thing of joy to companies coupled with the critical raw materials shortages, component, parts etc, and no complete autonomy given to purchasing and supply department to exercise full control over its function.
In some manufacturing company's purchasing and supply department lacks competent trained professional that can effectively handled the task of buying what is required in the most economic manner with a view of increasing profit, knowing that purchasing contributes to profitability.
Likely in many other professionals continuous staff training has been of immense important for growth of effective purchasing, as a dynamic area of management disciple, requires well informed professionals that can keep abreast will the changing business environment in order to achieve success for the manufacturing company.
The problem of this research is to analyze the various areas of impact of purchasing and supply management toward profit and growth in a manufacturing company.
1.3 Objectives of the Study
The objectives of the study is to prove that purchasing and supply management contributes toward profit and growth in a manufacturing company, purchasing and supply as a specialized discipline is meant to satisfy the materials need in a manufacturing company and it should not be seen as all comers affairs where anybody can come and do anything the way he want it.
Many public sectors of our economy have operated over the years but still deny the profession the rightful position it deserves. Lack of proper placement of his function in the bands of professional has contributed immensely to the flagrant wastage and unscrupulous diversion of manufacturing company fund into private purses, thereby increasing the cost of the overall output variable.
If is against this background that efforts should be made to ensure that there is no encroachment of other professionals into the purchasing activities. This is because purchasing as a profession has aims and objectives to be achieved and should not be seen as a gold wine where individual with little or on knowledge of the principle and practice of the function should encroach for selfish ends. Purchasing and supply, as a cost conscious department in any manufacturing company, ensuring that every purchasing made in the most economic manner so as to offer value for money therefore because the fundamental goals of efficient and variable purchasing science.
This means that manufacturing company that wants to remain in business must purchase material and component at the lowest cost consistent with quality and services requirements. in the same way, the quality and services of buying and maintaining inventory should be kept to the lowest level in order to achieve maximum efficiency with due regard to economy.
Understanding the fact that there are numerous advantages derivable from this management function, it becomes the researcher intention to look deeply into the various impact of purchasing and supply management towards profit creation and growth a manufacturing company and as such it is the objectives of this research work.
- Understand how Nigeria Brewery plc depot sees purchasing in its entire ramification.
- To find out the purchasing impact to a manufacturing company
- To further highlight any shortcomings that may be hinged through ignorance and other device
- This project is also meant to review the way profitability is being measured in Nigeria Brewery plc.
- It is also to determine the degree of interference (If any) by top management or other department on purchase materials.
1.4 Research Questions
- Does purchasing have any role to play in the manufacturing company?
- Is purchasing contributing to the profit in the manufacturing company?
- Is purchasing recognized in this manufacturing company?
- Is the purchasing manager solely responsible for buying materials and other items for your manufacturing company?
- Is the purchasing manage professional qualified in such areas the purchasing and supply management or is he/ she just qualified through job experience?
1.5 State of Hypothesis
In this pact of the research study, the researcher would be concerned with the empirical testing of hypothesis.
- Ho: Purchasing impact does not improve the effacing and productivity of the manufacturing company.
- Hi: Purchasing impact improves the efficiency and productivity of the manufacturing company rejecting Ho and accepting Hi.
- Ho: Manufacturing Company does not permit the purchasing manager/ officer to make most of purchasing decision.
- Hi: Manufacturing company permit the purchasing manger/ officer to make most of purchasing decision.
1.6 Significance of the Study
This study intends to the beneficial to three main categories of people that is. To the manufacturing company, the student and researcher.
To The Manufacturing Company
The findings of this study will acquaint it and shall also discover through this study a competent and well trained professional who can effectively manage and handle the taste of buying or purchasing in the most economic manner hereby increasing the profitability and growth of the manufacturing company and reducing waste.
To The Student
The findings of this study will enable the student to appreciate the course the more, it will also make them to be more economical, wherever they are to purchase materials, they must purchase materials in high quality, but at a lowest cost.
To The Researcher
The findings of this study will help the researcher the more, the advantages, impact of purchasing and supply management in a manufacturing company. To know or to indentify problems area in purchasing and supply function and develop strategies to solve item. The data gotten can be used for reference purposes.
1.7 Scope of the Study
- The study is an impact of purchasing and supply management in a manufacturing company of Nigeria Brewery plc.
- The study was limited to the Brewery Company due to time and other resources constraints the staffers to the company whose works relate to this topic were interviewed.
1.8 Limitation of the Study
The researcher in the course of carrying out his research work has contended some factors that limited in one way or the other against the zeal posed, they include the following.
Finance:
The research being a full time student at the time of making this research found it difficult to make ends needs with the little savings he made while working.
Time:
The researcher being a student and has a lot of academic work to pursue and some other things, has time constraint, instead of examine all the variables in purchasing n most of the notable industries, limits his study to only Nigeria Brewery plc.
Non-Response:
Most people interviewed were ignorant of what is called research, so they failed to give elaborate information about their manufacturing company despite the fact that the researcher told them that all information given would be confidential. Again, I found it very difficult to find good books relating to purchasing in the Federal Polytechnic Library, so I had to run round to many places for data collection of this undertaking.
1.9 Definition of Terms
Logistics Management:
encompasses all materials flows, from the flow of purchasing materials into facility through the manufacturing process and out to the customer.
Hastening Stock Level:
It is the amount of stock expressed in units of issue at which it is estimated that hastening action in necessary to request suppliers to make early delivery.
Maximum Stock Level:
This is defined as amount of stock expressed in units of issue above which the stock should not allow to rise.
Minimum Stock Level:
This is defined as the lowest level expressed in quantity below which stock must fall.
Right quantity: This is defined as the value o amount of material that can be most economically purchased at a particular time.
Ethics:
It is referred to as a set of principles or values (what is right and wrong)
Quality:
It is referred to fitness merit and excellence.
Purchasing:
Is a managerial process that goes for beyond simple buying materials.
