TITLE PAGE

THE EFFECT OF MATERIAL MANAGEMENT TECHNIQUE ON

PRODUCTION PLANNING PROCESSES
(A CASE STUDY OF COCA-COLA NIGERIAN BOTTLING COMPANY
KADUNA)

BY

IBRAHIM K. MAKOSHI
KPT/CBMS/09/2217

BEING A RESEARCH PROPOSAL SUBMITTED TO THE

DEPARTMENT OF MANAGEMENT STUDIES, KADUNA
POLYTECHNIC, KADUNA
IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE
AWARD OF A HIGHER NATIONAL DIPLOMA IN PRODUCTION AND
OPERATIONS MANAGEMENT (POM)

NOVEMBER, 2012
i
 DECLARATION

I hereby declare that this project has been conducted solely by me under

the guidance of my supervisor of Mallam Mustapha Y. I. of the

department of management studies, Kaduna polytechnic and I have

neither copied someone's work nor had someone else done it for me.

Authors whose works have been referred to in this project have dully

been acknowledge.

____________________ _________________
MAKOSHI K. IBRAHIM. SIGNATURE/DATE
KPT/CBMS/09/2217

ii
 APPROVAL PAGE

This is to certify that this research project is an original work undertaken

by me Makoshi K. Ibrahim with registration number. KPT/CBMS/09/2217

and it has been prepared in accordance with the regulation governing

the preparation of project in Kaduna polytechnic.

Mal. Mustapha Y.I ` _____________

Project supervisor Sign/Date

Mal. Kabir M. Baba Inna _______________

Project coordinator Sign/Date

Dr. (Mrs.) Grace N. Epunobi ________________

Head of Department Sign/Date

External Examiner ________________

Sign/Date

iii
 TABLE OF CONTENTS

Title Page
Declaration
Approval
Table of Contents
CHAPTER ONE
INTRODUCTION

1.1 Background of the Study

1.2 Statement of the Problem
1.3 Objectives of the Study
1.4 Statement of Hypothesis
1.5 Significance of the Study
1.6 Scope of the Study
1.7 Limitations of the Study
1.8 Historical Background of NBC Plc
1.9 Definitions of Terms

CHAPTER TWO
LITERATURE REVIEW
2.1 Definition of Materials Management
2.2 Production planning
2.3 Materials Control
2.4 Purchasing (Procurement)
2.4 Stock Ordering
2.5 Types of Stocktaking
2.6 Benefits of Stocktaking

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 CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Research Design
3.2 Research Population
3.3 Sample Size and Sample Technique
3.4 Methods of gathering Data
3.5 Justification of method used
3.6 Methods of Data Analysis
3.7 Justification of Instrument used

v
 CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The subject matter of this study is the effect of material

management technique on production planning process in coca-

cola Nigeria Bottling company kaduna. The research is meant to

be of great importance to various enterprise and organization

wishing to conduct a detailed study into stores and purchasing

material hence, the research aims at identifying the problems

associated with efficient operation in an organization, the research

is interested in knowing the effect of material management

technique on production planning process as practicable in an

organization. Due to sophistication in technology coupled with

socio-economic and political instability, prodution processes face

complex problems that needs to be addressed by management

ensuring that materials are allocated and used in the most efficient

and effective manner.

The material management technique on production is also to

identify problems by guiding against supb-optimization of the

material management techniques in production planning

processes, for this the researcher suggests that which will achieve

optimal result quickly, cheaper and acceptable.

1
 Today materials are the live-wire of every organization be it public

or private ,hence no organization can survive without material, its

availability, distribution and transportation and delivery at the right

amount and quality is paramount.

1.2 STATEMENT OF THE PROBLEM

Coca-cola bottling company plc as an organization is faced with

problems in relation to utilization of the effect of material

management being the utmost thing that are needed to be utilized

effectively. The problem facing material management especially in

coca-cola bottling company plc are mainly under stocking or over

stoking of material, stock obsolescence breakage and the

economic order quantity.`

Due to the fact that the impact is to be felt positively in the society

by making themselves’ productive in every area of inputs.

But despite the effect observed there have been general apathy,

ignorance and lack of interest by many people and the

government.

1.3 OBJECTIVES OF THE STUDY

Specifically, the aims and objectives of this study are:

i. To assess the impact of material management on

organizational performance.
2
 ii. To appraise and further appreciate the significance of

material management in a manufacturing industry.

iii. To identify and ascertain some of the problems poised by

materials management in Nigerian Beverage Company

(coca-cola) Kaduna.

iv. It is also the researcher's desire that this compilation will be

of great help and interest to whosoever uses it to gain

knowledge on issues discussed.

1.4 STATEMENT OF HYPOTHESIS

The following hypothesis was formulated for this study:

H0: Material management does not have any significant impact

on organizational performance.

H1: Material Management do have significant impact on

organizational performance.

1.5 SIGNIFICANCE OF THE STUDY

A research of this nature will be incomplete without highlighting the

importance of this study.

Firstly, the researcher as a student aspiring to be a material

executive in the future sees this study as an opportunity to fully

3
 investigate into the field of materials management to see the

challenges therein.

Secondly, the study is needed as a pre-requisite for the award of

the Higher National Diploma in Production and Operation

Management (POM).

Furthermore, the researcher has also undertaken the study inorder

to gather necessary information and suggest solution to the

problem facing materials management in Nigeria Bottling

Company (Coca- cola) Kaduna.

1.6 SCOPE OF THE STUDY

The subject matter “Materials Management” has an area of

coverage within its concept, i.e. theory and practice in the private

sector. This would also include purchasing, stocktaking and stock

checking of materials.

1.7 LIMITATIONS OF THE STUDY

In carrying out this research, certain problems were encountered

which infact hindered the area of coverage.

 The researcher faced the problem of sourcing for materials

for the project .

4
  Time constraint was a factor the researcher encountered.

This resulted in the backlog of the researcher’s class work.

 Lack of textbooks related to the subject matter also

contributed to backlog in writing the project.

 Unco-operative and bureaucratic attitude of Nigerian Bottling

Company Industry Limited officials who were reluctant in

providing necessary information in writing.

 Despite all these constraints, the researcher was lucky to

gather vital information that made the investigation a

success.

1.8 HISTORICAL BACKGROUND OF COCA-COLA NIGERIA

BOTTLING COMPANY KADUNA

Coca-Cola first came to Nigeria in 1953 when Nigerian bottling

company set up its first plant in Lagos. It marked the beginning of

an existing store of growth and development particularly during the

past years.

Nigeria bottling company plc is today Nigeria's number one bottle

of soft drink as claimed by the company and from the research

finding, selling more than eight million bottle per day, a figure

which is still growing with the expansion of the existing, twelve(12)

plants and the opening of brand new plants in various part of the
5
federation. The company established three departments under

Kaduna plant VIZ-(a) Minna, (b) Zaria, (c) Abuja. Coca-cola is the

number one best seller in the coca-cola segment, Fanta is the

orange segment and sprite most widely sold lemon drink in Nigeria

Nigeria Bottling Company is a subsidiary of Leventis which serve

as its parent company. The company has two section namely:-

soft drink section and agricultural section. The company now

operates on a large scale agricultural programme with two farms

situated at Zaria in kaduna state and Agenobode in Edo state

apart from production of soft drinks.

PRODUCT LINE

The following are Nigeria bottling plc product line Coke, Fanta,

Sprite, Ginger A/c, Fanta tonic, Fanta club Soda ands Krest, bitter

lemon

LOCATION

Kaduna plant which is the area of study of the research is situated

at Inuwa Abdul-kadir Road behind Kaduna Transport Authority

(K.S.T.A) and a stone throw from Peugeot automobile Nigeria

limited ( PAN). The company is headed by a manager with

department head taking control and the general supervisor of the

company
6
OBJECTIVES OF THE COMPANY

1 To produce soft drinks to the consuming population

2 To make profit

3 To re-profit with the purpose of expansion

4 To provide employment opportunities

5 To carry out the distribution activities of its production by

supplying direct to customer.

6 To penetrate and dominate the Nigerian soft drink market

7 To assist in the economic development of the nation.

MANAGEMENT

In order to achieve the above objective, the company requires

sound and effective organizational structure. The company's

drawn-up structure, kaduna plant is headed by a plant manager to

whom five (5) sectional head report. The sections that make up

the plant are:-

 Engineering

 Accounting

 Production

 Sales

 Clinic

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 The day to day administration of the company's activities is under

the leadership and supervision of the plant manager.

1.9 DEFINITION OF TERMS

 Material Management: This is defined as the grouping under

one head all or some of the activities involved in the

organization and use of materials employed from the need

stage up to the storage of finished goods.

 Purchasing: Purchasing is defined as the activity directed to

securing by legal means, the materials suppliers and equipment

required in the operation of an enterprise.

 Sourcing: This is referred to the investigation and evaluation

of sources of supply and suppliers.

 Negotiation: Is a process of planning, receiving and analyzing

conditions by both buyer and seller to arrive at an acceptable

agreement through mutual understanding.

 Expediting: It is a process of ensuring that goods are promptly

delivered to the right place and at the right time.

 Purchasing Requisition: It is a form usually prepared when a

department or stores need materials to be purchased.

 Issue: Issue is the withdrawal of goods and handover of stock

to user backed with authorized documents.

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 Organization: Are artificially contrived structure with

procedures and objectives defining the responsibilities, who

does what type of job task, who report to whom and when and

who is responsible for what action.

 Quality Control: Is a process whereby goods and services are

examined to ensure that they conform to predetermined

standards.

 Obsolescence: These are materials for which there is no

demand either because of the presence of a better substitute or

they are out of use or fashion.

 Stocktaking: This is the complete process of verifying the

quality balance of the entire stock hold in the store.

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 CHAPTER TWO

LITERATURE REVIEW

2.0 INTRODUCTION

This chapter will present the opinions of earlier writers on the

subject matter by reviewing existing relevant literature on material

management. Therefore, it will be a sieve of relevant material(s) on

the subject matter.

2.1 DEFINITION OF MATERIALS MANAGEMENT

Over the years a number of exponents have expressed various

views as what materials management entails. The following are

just few of such views.

Donald and Lammar (1997) describe materials management as

practical in business today “as a conference of traditional materials

activities bound by a common idea – the idea of an integrated

management approach to planning, acquisition, conversion, flow

and distribution of production materials from the raw materials to

the finished product state”, they also said that materials

management concept advocates the assignment of all major

activities which contributed to material’s cost to a single materials

management department. This includes the primary

responsibilities which are generally found in the purchasing

10
department, plus other major procurement responsibilities,

including inventory management, traffic, receiving warehousing,

surplus and salvage and frequently production planning and

control.

They went further to say that the specific form of materials

management that is most appraised for one organization may not

be best form for another organization. In practice, for most firms,

the production planning and purchasing schedules overlaps

significantly. Unfortunately, this frequently produces a continues

source of conflict.

One of the paramount advantages of materials management is

that it forces coordination between purchasing and production

control. Purchasing and production control are both responsible for

the on-time delivery of production materials. Division of this

authority between two different operating units inevitably leads to

conflict. When materials do not arrive on time production control is

seldom satisfied to work through the purchasing department. Such

conflict can be resolved much more easily when production control

and purchasing report to a single boos – the materials managers.

11
They conclude that substantial benefits will accrued when

inventory management value analysis, receiving stores and

surplus and salvages placed in materials management.

In view of the above, the researcher’s view, the work and

contributions of Donald and Lammar Lee on what materials

management because of how it is being implemented in various

organizations today. Some elements are lacking in their concept of

materials management.

Alijian (1998) define materials management “as that aspect of

industrial management which is concerned with all of the activities

involved in the acquisition and use of all materials employed in the

production of finished goods. The activities may include production

control, inventory control, purchasing, expedition, shipping scarp

and surplus disposition and customer services. However, the term

materials management is frequently used when only some of these

functions are included.

He based his materials management concept on the theory that

are more effective control over an important aspect of a company’s

operation can be obtained by group together all departments

involved in any way with the materials used by the company.

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Under the concept all of the aforementioned departments are

included, these are departments, which handle different aspect of

the same basic problems namely, the efficient and economical

planning, scheduling and handling of the materials used in the

manufacturing process.

He also confirmed that the use of computer and electronic data

processing equipment has enhanced and facilitated adoption of

the materials management concept. Materials management

organization can be set optimum purchasing and inventory policies

for any number of items and plant location. In addition, computer

oriented techniques can analyze, schedule, report and forecast

information about materials in any manner and time that when

henceforth possible or impractical to perform.

To this end, the writer is of the opinion that, Alijian’s idea of

materials management is alright, but only that he never gave a

clear cut definition of what materials management should be with

regard to the activities of distribution involved in the acquisition and

use of all materials employed in the production of finished product.

In his research, he highlighted that the adopters of the materials

management approach recognized different shortcomings, which

13
prompted them to re-organize the materials management

concepts.

He concludes that applying the materials management concept

overcomes many of these difficulties:

 The variable involved in the sub-functions are additive in

nature.

 They require a common direction of management, which

provides concise and integrated delegations of authority.

 The importance of the management principles of

accountability by making a single manager responsible for all

aspect of materials decision.

The writer of this subject matter viewed the work and contribution

of Alijian as great benefits to any organization who wish to employ

the concept. He concluded that applying materials management

overcomes many of the difficulties in organization already

discussed.

Ammer (1996) sees materials management as “The line of

responsibility which begins with the selection of suppliers and ends

when the material is delivered to its point of use.

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Ammer (Ibid) listed the possible conflicts between department

materials objectives and these are shown below:

Possible conflicts between Department material objectives:

i. Minimum Price for Materials: Higher inventory turnover,

continuity of supply, consistency of qualified, low payroll

costs and favourable relations with supply sources.

ii. Higher Inventory Turnover: Minimum prices, low cost of

acquisition and possession, continuity of supply, low payroll

costs.

iii. Lower Cost of Acquisition: Higher inventory turnover

(sometimes). Acquisition and process good records, and

continuity of supply consistency of quality.

Article II: Primary Objectives, inter related objectives:

iv. Continuity Supply: Minimum prices for materials, high

inventory turnover, favourable relation with suppliers.

v. Consistency of quality: Minimum prices for material, high

inventory turnover, low cost of acquisition and possession.

vi. Low payroll cost: Maximum achievement of these

objectives is possible by sacrificing all other objectives.

vii. Good supplier relations: Low payroll costs, minimum

prices, high inventory turnover.

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 viii. Development of personnel: Low payroll costs.

He argues that, these conflicts are emphasized by a department

organization which being alleviated by adopting the materials

management structure. As many advocates of system approaches

having stated that, difficulties occur when there is a lack of

recognition of the effect of conflicting objectives. Generally

speaking, it is argued that various members of an organization are

not aware of:

 The type and range of problems facing others in a system and the

need to consider the efficiency of the system as a whole rather

than their particular department. The writer views the work

and contribution of Ammer as of great benefit to any organization

operating materials management, state system, since he

emphasizes the necessity to balance functional objectives in a bid

to resolve the conflicts suggested above and concluded that

applying the materials management concepts overcome those

difficulties.

National Association of purchasing management (NAPM) (1975)

defines materials management “as a concept of operation which

systematically integrates horizontally related materials functions,

commencing with the determination of materials needs and

16
culminating in the delivery of the finished products. It considered

the responsibility for the functions of purchasing, production and

inventory control, and physical distribution to optimize company

profitability by achieving the least material cost.

In view of the above, the writer is of the opinion that NAPM’s

definition of materials management is alright because they went

further to say that achieving the least materials cost will promise

company profitability.

Ugbana, (1986) a renowned author on the subject matter

describes material management as an effort to bring together

under one manager's responsibility for - determining manufacturing

requirements in production planning and control,Procuring sharing

and dispersing materials on time within allowable cost and

scheduling the manufacturing process. He went further to say that

a number of basic forces are making the materials management

approach vary according to the factors which will largely determine

the organizational approach such as;

 The nature of the manufacturing operation.

 The amount of cost reduction that can be obtained e.g where

materials cost make up a large part of the total costs.

17
 To reap certain other benefits of materials managements e.g.

improved decision-making co-ordination and control.

 The importance of the management of accountability by making

a single manager responsible for all aspect of materials

decision.

He concluded by citing four(4) conditions under which materials

management is applicable. He said materials management is

especially applicable when:

 Materials cost make up a large part of total cost.

 Co-ordination is improved and conflict reduced between

activities, which if departmentalized might have practically

different objectives.

 Materials management encourages the coordination of

materials flow from the supplies to the plant and within the

plant.

 Reduction in costs of purchased items, inventory,

transportation, clerical procedures and staff.

In view of the work and contribution of Ugbana on what materials

management should be as of great help to any company wishing

to employ the concept. The writer on this subject matter, view that

there are there different definition by different authors.

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Zenz (2001) in his book materials management (May:22 edition)

describes materials management as “a concept which brings

together under one manager the responsibility for determining the

manufacturing requirements scheduling the manufacturing

process, procuring, storing and dispersing materials”.

Bowewox (2000): noted the concept “as the aspect of overall

logistic concerned with the procurement of raw materials, parts

and merchandise for resale as materials management.

He further stated that materials management is essential to

manufacturing because timely and economic delivery is necessary

to maintain efficient and continuous production.

He concluded that materials management activities initiate from

operation plan. The operating plan provides a statement of

requirement to support manufacturing or marketing operations and

contains specification concerning when and for what facilitate the

items are to be procured. The task of materials management is to

satisfy economically the requirements outlined during operational

planning.

In view of the above, the (work) and contribution on what materials

management should be as not sufficient enough for efficient

19
 materials management because he was mainly concerned with the

procurement of the materials as being what materials management

is.

2.2 PRODUCTION PLANNING

American production and inventory control society (APICS),

defines production planning "as a process to develop tactical plans

based on setting the overall level of manufacturing output and

other activities to best satisfy the current planned level of sales

(sales plan or forecast) while,meeting general business objective

of profitability, productivity, competitive customer lead time as

expressed in the overall business plan.

Burdrige (1998), noted that the concept refers to the function of a

manufacturing enterprise responsible for the efficient planning,

scheduling and coordination of all production activities. The

planning phase involves forecasting demand and translating the

demand forecast into a production plan that optimizes the

company's objective, which is usually to maximize profit.

Production planning is concerned with deciding in advance what is

to be produced, when to be produced, where to be produced and

how to be produced. It involves foreseeing every step in the

20
 process of production so as to avoid all difficulties and inefficiency

in the operation of the plant. Production planning has been defined

as the technique of forecasting or picturing ahead every step in a

long series of separate operations, each step to be taken in the

right place, of the right degree, and at the right time, and each

operation to be done at maximum efficiency. In other

words,production planning involves looking ahead, anticipating

bottlenecks and identifying the steps necessary to ensure smooth

and uninterrupted flow of production. It determines the

requirements for materials, machinery and man-power; establishes

the exact sequence of operations for each individual item and lays

down the time schedule for its completion.

2.3 MATERIALS CONTROL

Appleby (1972) describe materials control as a section which is

responsible for ensuring the right quantity and quality of materials

available when and where required. At the same time capital must

not be tied up unduly, nor there be undue loss from deterioration

and obsolescence. He also says that a good system of materials

control required;

 Centralization of purchasing under a buyer

21
 Department co-ordination and purchasing inspection, receiving,

storing and issuing of materials.

 Simplifying and standardizing whenever possible.

 Planning and scheduling materials requirements and preferably

control by budgets

 Stocktaking procedure to be efficient

Jones (1986), a renowned author on the subject matter describe

materials control as “a system that ensures the provision of the

required quality as at required time with the minimum amount of

capital tied up. Also, that materials control covers the function of

stock controls scheduling materials requirement, purchasing,

receiving and inspection, storing and issuing. He went further to

say that in any manufacturing organization, be it large or small

materials must be controlled efficiently. In view of this, he

highlighted on the following:

i. That if any company wants to survive and be profit oriented,

there must be a proper system for the control of materials

from the time an order is placed with a supplier, until the

material is used for production.

ii. That materials represent an important asset and is the

largest single item of costs in almost every business

22
 therefore, the success or failure of any company may

depend largely on effective and efficient control of materials

purchased.

iii. Where materials are not systematically controlled, excess

stock of materials are likely to occur with a consequent

unnecessary tied up capital and loss through obsolescence

and deterioration.

iv. Efficient materials control cuts losses and forms of waste that

otherwise tend to pass unnoticed. Thus, incoming materials

should be checked against orders to ensure that the correct

quantity have been received.

He concludes by saying, to achieve the above points the following

methods must be adopted for controlling materials;

 There should be co-ordination between the department involved

in buying, receiving, inspection and storage of materials.

 There should be centralization of materials under the authority

of competent buyer.

 There should be proper classification and where applicable

coding of materials

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  There should be the use of standard form of orders of

requisitions, returns to store and so on, upon which written and

signed instruction is given.

 There should be an efficient stock control procedures and

records.

Abiodun (2000) asserts materials control as “The system that

ensure the provision of the required quality of materials or

required quality, at the reasonable prices, at the required

placed, at the right time, with the minimum of capital tied up. He

concluded that materials control covers the following functions:

 Purchasing, receiving storage and isses

 Stock control

 Materials production, planning and control

From the above points, the writer's view is that for any

manufacturing company to be efficient there must be proper

planning and control of their materials right from the time of issuing

order of raw materials to the finished product stage without tying

up capital unnecessarily.

2.4 PURCHASING (PROCUREMENT)

Alijian (1993) noted purchasing “as the term used in industry and

management to denote the act of the functional responsibility for

24
acquiring materials, supplies and services” he went further to say

in a narrow sense, the term purchasing simply describes the

process of buying, however, in a broader sense the term purchasin

surpasses the act of buying, it involves determining the needs,

selecting the suppliers and proper delivery.

Baily and Farmer (1996) in their book defines procurement

objectives as an act “to purchase the right quality, at the right time

in the right quantity from the right source at the right price. A good

objective, should be measurable in some way but, what price is

right?

They suggested the statement of the following objectives:

 To supply the organization with a steady flow of materials and

services to meet needs and also to ensure continuity of supply

by maintaining effective relationship with existing sources of

supply either as alternatives or to meet emerging or planed

needs.

 To buy effectively and wisely obtaining by an ethical means the

best value for every money spent.

 To maintain sound cooperative relationship with other

departments providing information and advice as necessary to

ensure the effective operation of the organization as a whole.

25
Evans (2001) in his own contribution sees purchasing as the

process of buying goods and services of the right quantity, at the

right price, at the right time from the right suppliers or sources to

be delivered when and where needed, hence the rights (5 rights)

of purchasing.

He explains further, that the concept is a continuous process that

is responsible for the anticipation, identification and provision of

goods and services that are required by an organization with the

objectives of helping it increase its profitability or services

provided.

From the foregoing discussion it can be noted that there are

different emphasis between the three definitions although they are

all concerned with the purchasing of goods and services.

In that regards, the researcher view purchasing as a mangerial

process, aimed at ensuring continuous flow of materials, projects

and services into and within the organization in order to meet with

its goals and objectives, profitability and efficiently in an ever-

changing business environment.

26
2.5 STOCK ORDERING

Light (1986) suggested that to maintain effective control of

materials or stock, it is necessary to determine what should be the

maximum and minimum stocks i.e. what may be required as a

standard order for a particular commodity and the point at which a

further supply should be ordered. Maximum stock is the largest

quantity which is in the interest of economy should be carried,

while minimum stock is the lowest quantity below which the stock

should not be allowed to fall. The standard is the quantity to be

purchased at any time and is the amount calculated to be most

economical. He said ordering is the point at which the re-ordering

system comes into operation. It is the minimum stock permissible

plus time estimated consumption during the period which must

elapse between the placing of an order.

In view of the above discussion, the writer views that in any

manufacturing industries stock must be held for the purpose of

providing a reservoir of materials to absorb the effects of variation

in delivery and consumption and maintain the ready availability of

supplies within the organization concerned. To achieve this

purposes, stock level must be in operation, if there should be

perfectly, efficiently and reliable materials control.

27
2.6 TYPES OF STOCKTAKING

Iornum (2007) state the following as types of stocktaking:

Continuous/Routine Stocktaking: This is the system whereby stock

is counted continuously throughout the year, this could be done

either weekly or in accordance with the predetermined programme.

This means that every item in stock would therefore be physically

counted and checked without having to close the store.

Periodic Stocktaking: This is where the whole stock is counted

and a complete stocktaking is performed at regular intervals,

usually at the end of each financial year, or in some cases at

quarterly intervals, it is one of the most common ways of counting

and checking the stocks.

Blind Stocktaking: This is a practice whereby the person taking

the stock is not given prior information about the vocabulary

numbers, descriptions, stock records balance or location of the

item. He is to check and is not allowed to access stock record

cards or bin cards. The theory is that the check would move the

delivery of the goods. In times of shortage, this period must

fluctuate considerably and must be closely watched.

The Economic Order Quantity (EOQ)

Is that which can be secured a what is known as “the least unit

cost” it is not necessarily correct to buy materials at the lowest

28
prices obtainable. The objective of stores control is to purchase

materials to the amount which secures an uninterrupted supply of

the commodity at the least ultimate cost. It is the cost of the

materials when issued to the using department which is of prime

importance not the actual cost of the goods when received from

the suppliers.

Stock Level

(Basic Method of Controlling Stock)

There are various types of stock levels, but the fundamental

controls are:

Minimum Stock Level

This is that level below which stock must not be allowed to

decrease, this is sometimes called “buffer or safety stock” because

it can be drawn upon during emerging need.

Maximum Stock Level

This is the level above which stock must not be allowed to

increase. It is advisable that stock maximum level must be kept as

low as possible.

Re-Order Level

This is the vital stock level as which stock control trigger off

replacement orders for further supplies so far as stock is

29
 concerned. The level is fixed in such a way that new orders are

delivered before the stock falls below the minimum level reliable as

the stock taker has no knowledge of what is supposed to be in

stock.

2.6 BENEFIT OF STOCKTAKING

Morrison (1999) further stressed the benefit for stocktaking to be:

 To verify the accuracy of stock records

 To support the value of stock shown in the balance sheet by

physical verification

 To disclose the possibility of fraud, profit or loss

 To reveal any weakness in the system for the custody and

control of stock.

30
 CHAPTER THREE

RESEARCH METHODOLOGY

3.1 RESEARCH DESIGN

The research design used in any study are highly important for its

success, however at the time of conducting this research, the

researcher found it more appropriate and convenient to make use

of both descriptive and analytical research design. The research

was done to ensure that all possible findings were adequately

represented by the applications of appropriate tools of

management. Thus, descriptive research design consist of a set of

patterned information, analyzed, summarized and interpreted

along to suit the area of study.

3.2 RESEARCH POPULATION

The population of the study is NBC plc kaduna plant. Thus the

entire staff of this plant constitute the study population and the

firms total staff strenght is two hundred and eighty (280).

3.3 SAMPLE SIZE AND SAMPLING TECHNIQUE

The sample size of this work is twenty eight(28) i.e. Sample size of

(28) is calculated from the total population of two hundred and

31
 eighty workers of NBC coca cola Kaduna plant, using Roscoe 10%

rule thumb.

3.4 METHOD OF GATHERING DATA

The researcher will employ two sources of data collection and they

are: primary and secondary sources. In acquiring primary data, the

researcher will use both the questionnaire and interview methods

in data collection. The secondary source include : data obtained

from textbooks, past projects, magazines, journals etc.

3.5 JUSTIFICATION OF METHOD USED

The researcher has chosen the questionnaire method in order to

collect accurate data directly from people in the field. The method

is simple to use and objective in nature which does not involve

complex mathematical or statistical calculations. It gives everyone

in the field to answer the questions with an even chance, which

simply means that if carefully implemented will enable the

researcher to arrive at a conclusive objective.

3.6 METHODS OF DATA ANALYSIS

The researcher will employ the use of simple percentage method

for the data analysis and interpretation of each table in relation to

the overall response expressed as a percentage. The chi-square

32
 will be employed by the researcher for the test of hypothesis and

textual narration for quick and easier understanding of data

presentation for the formulated hypothesis in section 1.4 at &=

0.05 level of significance. Thus X2(chi- square) is computed as

follows;

X2 = E(fo - fe)/fe

Where : fe= expected frequency

f0 = observed frequency

To compute fe = column total x row total/ grand total

Degree of Freedom(DF) = (c-1) (r-1)

where c = column ; r = row

Level of significance is 5% which is 0.05

Decision rule:

Reject Ho if X2 calculated > 0.05

Accept Ho if X2 calculated < 0.05

3.7 JUSTIFICATION OF INSTRUMENTS USED

The researcher chooses the simple percentage and chi-square

method as procedure for statistical analysis for the purpose of

easy documentation, accuracy and clarity. Thus, the simple

percentage is considered as valuable method for its simplicity and

clarity.

33
 BIBLIOGRAPHY

Aljian, R. J. (1998). Store Management and Related Operations,

London: McDonald and Evans ltd.

Burdrige, J (1998) The principle of production and control (3rd ed)

London: Estovers McDonald and Evans Ltd.

Donald, J. & Lamma A. (1997) Effective Warehousing. 3rd Edition;

London: McDonald and Evans Limited.

Charles, T. H. (1987). Introduction to Management Accounting: 2nd

edition, London: Prentice Hall Series in Accounting.

Denver, J. C, (1981). Office Management, 3rd Edition. London: FLBS

Publishing Company. Ltd.

Imaga, E. U. L. (2001) Theory and Practice of Production Management.

Gostak Printing and Publishing co. Ltd, Enugu Nigeria, Volume
one.

Iornum, B. T. (2007). Introduction to Material Management. Kaduna:

D’lord Printing and Publishing Co.

Locker, K. G. (1981), Factory Management, 3rd Edition. London: Pitman

Publishing Company ltd.

Ammer, C. K. (1996). Purchasing, M & E Handbook, 2nd Edition. London.

Soji, O. (2002), Managing Your Small Scale Business Successfully: A

Guide to Entrepreneurs, Managers, and students 3rd Edition, Lawal
Graphic. Prints.

Ugbana, (1996) M. N. Effective Stores Management (Unpublished).

Zenz, A. (2001) Storage and Control of Stock, 3rd edition, Pitman

Publishing Company Ltd

34
 Depart of Management Studies
College of Bus & Management Studies
P.M.B. 2113,
Kaduna Polytechnic, Kaduna

Dear Sir

QUESTIONNAIRE

I am a student of Kaduna polytechnic undertaking a research on The

Effect of Material Management Technique on Production Planning

Processes.

The study is to enable me collect valid response with the respect to use

the analysis of the topic mention above as a project write-up, the project

is in partial fulfillment for the award of Higher national Diploma (HND) in

production and operation management. I am information to be collected

will be treated in strict confidence and only fore academic purpose.

I am assure you that all information released to me shall be treated as

strictly confidential and shall be used only for academic purpose

Thank you for your cooperation

Yours faithfully

Makoshi K. Ibrahim
Researcher.

35
Please tick the appropriate answer among the option provided in the

question below.

1. Indicate our sex?

a) Male [ ]

b) Female [ ]

2 Are you a staff of coca-cola plc operating in Kaduna?

a) Yes [ ]

b) No [ ]

3 The length of service of the operation manager?

a) 0-5 [ ]

b) 6-10 [ ]

c) 11-15[ ]

4 how would asses your customer response to your product?

a) Very good [ ]

b) Good [ ]

c) Fair [ ]

5 what period of time does your company experience high sale?

a) Dry season [ ]

b) Raining season [ ]

c) All of the above [ ]

6 do you have adequate personnel managing production planning

process
36
 a) Yes [ ]

b) No [ ]

7 Does adequate planning and processes provision increase the

level of production in coca-cola?

a) Yes [ ]

b) No [ ]

8 To what extent does the company achieve is production level?

a) Very often [ ]

b) Often [ ]

c) Not often [ ]

9 the problem that is racing the material management technique in

problem planning processes in coca-cola over stocking

a) Strongly agree [ ]

b) Agree [ ]

c) Undivided [ ]

d) Disagree [ ]

e) Strongly disagree [ ]

10 the government initials are having a wrong impression wrong

notice on the effect of material planning processes?

a) Strongly agree [ ]

b) Agree [ ]

c) Undivided [ ]
37
 d) Disagree [ ]

e) Strongly disagree [ ]

11 the effect of material management technique in production

planning processes is not noticeable in Nigeria or taking a proper

action?

a) Strongly agree [ ]

b) Agree [ ]

c) Undivided [ ]

d) Disagree [ ]

e) Strongly disagree [ ]

12 is there any waste of material in coca-cola bottling Company

a) Yes [ ]

b) No [ ]

13 what type of technique do Nigeria bottling company (NBC) plc

used in souring for raw material

a) Importation [ ]

b) Proactive technique [ ]

c) Contracting [ ]

d) Reactive technique [ ]

14 state the type of protection system that is being practice in the

company?

a) Job production [ ]
38
 b) Data production [ ]

c) Continuous production [ ]

d) all of the above [ ]

e) Strongly disagree [ ]

15 does your organization have specific committee for productin

planning processes?

a) Yes [ ]

b) No [ ]

39