An Assessment of Inventory Management in Small and Medium Scale Industrial Enterprises in Nigeria

Abstract

Inventory is a vital asset, necessary for effective operation of any business organisation. The absence of good inventory management practices in the Small and Medium Scale Industrial Enterprises (SMEs) necessitates a study to determine the actual reasons for non application of scientific inventory management techniques in the SMEs. Three hundred and twenty  SMEs in  Food, Textiles, Wood and Metal Products sectors in South Western Nigeria were selected for the study. Two hundred and twelve organizations returned the questionnaire. It is established that non usage of scientific inventory techniques for better inventory decision was due to lack of skilled personnel and inadequate data to use inventory models; and low level of ICT in the SMEs. It is recommended that the SMEs should institute structure to improve the knowledge of their personnel about using quantitative inventory decision models and the SMEs should make the application of Information Communication Technology (ICT) for data management a priority.

Keywords: Inventory, Just-In-Time, organisation, Economic- Order- Quantity, Re-order- Quantity, Profitability