Assessment of inventory management
CHAPTER ONE
INTRODUCTION
1.1
Background of the Study
Resources are scarce; profit making organization should know how to utilize these resources effectively and efficiently. The inventory control section of a company is responsible for these activities, in order to continue the operation of the organization through out the year they have to use the rules and principles to handle different kinds of materials. Since it improves inventory handling activities with in the organization, it will help to avoid utilization of resources for un authorized purpose and also helps to maintain necessary material when it is needed for production and selling. It facilitates the interaction of different departments with in the organization. For instance, the marketing department will continue it selling activities if products are available when they are demanded by the market. Availability of production is also entirely dependent on timely supply of raw material and supplies.
In addition appropriate inventory management avoids un necessary carry cost and shortage of materials by indicating inventory level. It helps to avoid costs incurred when the price of material increases due to shortage of material and shortage of transportation.
This study was made to asses weather the Anbessa Shoes S.C manages its inventory based on scientific method and to know how proper inventory control maximize quality of product and profitability. The company engages in the production of shoes it used leather, sole as a raw material. The company imports raw materials from abroad and purchase from local market. The reason why I selected the company for my study is easy to get information.
1
1
1.2
Background of the Company
Anbessa Shoe S.C was established in 1939 ad started production of shoes at the time when such conveniences were not widely known among the general populace of the country Its establishment was apparently in response to increased demand for shoes, which must have been triggered
INTRODUCTION
1.1
Background of the Study
Resources are scarce; profit making organization should know how to utilize these resources effectively and efficiently. The inventory control section of a company is responsible for these activities, in order to continue the operation of the organization through out the year they have to use the rules and principles to handle different kinds of materials. Since it improves inventory handling activities with in the organization, it will help to avoid utilization of resources for un authorized purpose and also helps to maintain necessary material when it is needed for production and selling. It facilitates the interaction of different departments with in the organization. For instance, the marketing department will continue it selling activities if products are available when they are demanded by the market. Availability of production is also entirely dependent on timely supply of raw material and supplies.
In addition appropriate inventory management avoids un necessary carry cost and shortage of materials by indicating inventory level. It helps to avoid costs incurred when the price of material increases due to shortage of material and shortage of transportation.
This study was made to asses weather the Anbessa Shoes S.C manages its inventory based on scientific method and to know how proper inventory control maximize quality of product and profitability. The company engages in the production of shoes it used leather, sole as a raw material. The company imports raw materials from abroad and purchase from local market. The reason why I selected the company for my study is easy to get information.
1
1
1.2
Background of the Company
Anbessa Shoe S.C was established in 1939 ad started production of shoes at the time when such conveniences were not widely known among the general populace of the country Its establishment was apparently in response to increased demand for shoes, which must have been triggered
Bibliography: - A.K DATTA (1987), Materials management and inventory control. - A.K DATTA, (2003), Material Management, 2nd edition. - A.K DATTA, (2004) Material Management 3rd edition. - Jossop and Morison (1998) “Stores and Storage Management.” Sundareson (1997) BERHANU DEJENE JANUARY, 2010