This research presents the investigation into the impact of material management on the profitability of the manufacturing company, 7up Bottling company, Kaduna was used as the location for the study and a total of 100 staff was sampled. Data was gathered using a self -constructed questionnaire and the result gotten was analyzed using the simple percentage method, chi square was also used for the testing of the hypothesis. The validity and reliability of instrument were ascertained. The result of the study reveals that there is positive effect of material management in the profitability of the organization because material management effects the product output and this will definitely influence the profitability of the organization, Manufacturing firms in Nigeria are encouraged to increase their resource commitment to staff training in Materials Management so as to develop skills, update knowledge, enhance new product development and create indigenous source of supply for foreign materials.
It is quite obvious that every organization keeps materials which form one of the pivotal elements in the organization. Any establishment that is set up to produce one thing or another; any organization could either be goods producer or services delivery or both, and they must make use of materials in all their operations, and these materials must be properly managed to achieve the desired objectives.
Materials management is one of the most technological choices in any organization. Thus, it must be decided as to when, how and by who materials should be handled. It covers the processes of moving, packing and storing materials. Note that in the past, there was no any distinct method in use.
However, today the methods employed are numerous such as: The Automated Guided Vehicle (AGV), the Automated Storage and Retrieval System (ASRS).
1.1 Background of the Study
What dominates organizational operations and there seeks to transform management practices is no other than material management.
It is obvious that in all kinds of organizations, management effort is often times committed to the effective and efficient management of materials. Furthermore, the management practices have gained the understanding that the success of any can only be guaranteed in today’s circumstances by a practical and holistic commitment to materials management.
Materials management is not a mere technique, but a philosophy anchored on a belief that long run success depends on the uniform commitment to materials management in 7Up Plc, Kaduna Plant which can be achieved via the interplay of both the analytical and holistic facilities of the personalities concerned.
1.2 Statement of the Problem
Materials management as we all know is considered “life blood” of every organization. Unfortunately enough, most companies have entrusted the materials management functions into the hands of mediocre.
Therefore, the basic problem with which the study is concerned about is the unethical practices in the 7Up Plc Kaduna plant which includes: the placement of unqualified personnel on the functional, they do not have professional knowledge about, over invoicing and local inaccessibility of raw materials. Also, therefore is the problem of wastage and pilferage of materials in 7Up Plc, Kaduna plant.
1.3 Objectives of the Study
The main objective of this study is to find out the effect of material management on the profitability of the manufacturing company in Nigeria, specifically the study intends to:
1. Find out the effect of material management on the product output of a manufacturing company
2. Analyze the effect of material management on the profitability of a manufacturing company
3. Investigate the challenges of managing materials in manufacturing companies
1.4 Research Question
1. What is the effect of material management on the product output of a manufacturing company
2. Is there any effect of material management on the profitability of a manufacturing company
3. What are the challenges of managing materials in manufacturing companies
1.5 Significance of the Study
This study would add to the knowledge of the subject matter, “materials management” and equally help managers in 7Up Plc Kaduna plant in tackling the effects of stock taking, stock checking and stock recording in the organization, as one of the salient components of materials management.
It would enable managers to boost productivity and minimize or eradicate problems related to materials for students and businesses that will be embarking upon materials management operations.
It will generally help management in reducing wastage and pilferage of materials and equally enhance proper utilization of materials.
1.6 Scope of the Study
The study is concerned with materials management as an effective tool for productivity in Seven Up (7-Up) Nigeria Plc Kaduna plant. The study would cover the practical activities performed by Seven Up (7Up) Nigeria Plc Kaduna plant from the identification of new order up to the issue of ordered materials to the user department from 2008 – 2012).
1.7 Limitations of the Study
In every research work, the researcher is bound to face hitches. One of the problems anticipated during this research study include lack of cooperation from subjects or objects leading to use of smaller than anticipated numbers, low return of questionnaire and inability to use correct data gathering instruments due to ignorance about their availability. Another limitation was the attitude of the staff during visits to the organization. At the end, despite all the constraints, I was able to conduct the research successfully.
1.8 Definition of Terms
Stocks: These are raw materials of varying qualities held in store house.
Stores: This is a house or a structure prepared for safe keeping of materials.
Logistics: This is the process of averaging the movement and storage of goods and materials from their source to the point of ultimate consumption.
Bulk Issues: These are materials that are made in set agreed quantities in designated departments.
Obsolescence: These are items held in stock which becomes out of date and no further use to the organization.
Distribution Requirement Planning (DRP): This is a requirement placed by customers at the points of use or demand.
Stock Yard: This is an open air place in which materials may be kept for reasonable time without serious deterioration.
Work in Progress (WIP): These are inventories of materials in a part finished or partially assembled state.
Scrap: These are wastes, used or surplus materials or part arising out of manufacturing processes or other activities.
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