This study evaluated the degree of relationship between inventory management and profitability of manufacturing firmsin Nigeria. International Breweries Plc was adopted as case study. Secondary data were sourced from the company’s annual reports for the period of 10 years. A simple linear regression model was specified to test the correlation between variables used. Stock turnover ratio was used to capture the relationship between costs of sales incurred in generating total revenue and the inventory utilized in for production and distribution. The result generated from the study showed that the company operates an efficient Inventory Management System which has strong influence on its profitability. The correlation coefficient (r) was 85.3% while r2 was 72.7%. The study concluded that the efficient inventory management contributed significantly to profitability of manufacturing companies. The study recommended that manufacturing firms should focus on improving on their inventory management system by adopting a more efficient approach in utilizing inventory items.
| Published in | International Journal of Accounting, Finance and Risk Management (Volume 4, Issue 4) |
| DOI | 10.11648/j.ijafrm.20190404.12 |
| Page(s) | 110-115 |
| Creative Commons |
This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited. |
| Copyright |
Copyright © The Author(s), 2019. Published by Science Publishing Group |
Inventory Management, Profitability, Gross Profit, Stock Turnover Ratio
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APA Style
Adebola Daniel Kolawole, Adesola Busola Akomolafe, Babatunde Johnson Olusipe. (2019). Inventory Management: An Impetus for Increased Profitability in Manufacturing Firms. International Journal of Accounting, Finance and Risk Management, 4(4), 110-115. https://doi.org/10.11648/j.ijafrm.20190404.12
ACS Style
Adebola Daniel Kolawole; Adesola Busola Akomolafe; Babatunde Johnson Olusipe. Inventory Management: An Impetus for Increased Profitability in Manufacturing Firms. Int. J. Account. Finance Risk Manag. 2019, 4(4), 110-115. doi: 10.11648/j.ijafrm.20190404.12
AMA Style
Adebola Daniel Kolawole, Adesola Busola Akomolafe, Babatunde Johnson Olusipe. Inventory Management: An Impetus for Increased Profitability in Manufacturing Firms. Int J Account Finance Risk Manag. 2019;4(4):110-115. doi: 10.11648/j.ijafrm.20190404.12
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Download@article{10.11648/j.ijafrm.20190404.12,
author = {Adebola Daniel Kolawole and Adesola Busola Akomolafe and Babatunde Johnson Olusipe},
title = {Inventory Management: An Impetus for Increased Profitability in Manufacturing Firms},
journal = {International Journal of Accounting, Finance and Risk Management},
volume = {4},
number = {4},
pages = {110-115},
doi = {10.11648/j.ijafrm.20190404.12},
url = {https://doi.org/10.11648/j.ijafrm.20190404.12},
eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijafrm.20190404.12},
abstract = {This study evaluated the degree of relationship between inventory management and profitability of manufacturing firmsin Nigeria. International Breweries Plc was adopted as case study. Secondary data were sourced from the company’s annual reports for the period of 10 years. A simple linear regression model was specified to test the correlation between variables used. Stock turnover ratio was used to capture the relationship between costs of sales incurred in generating total revenue and the inventory utilized in for production and distribution. The result generated from the study showed that the company operates an efficient Inventory Management System which has strong influence on its profitability. The correlation coefficient (r) was 85.3% while r2 was 72.7%. The study concluded that the efficient inventory management contributed significantly to profitability of manufacturing companies. The study recommended that manufacturing firms should focus on improving on their inventory management system by adopting a more efficient approach in utilizing inventory items.},
year = {2019}
}
TY - JOUR T1 - Inventory Management: An Impetus for Increased Profitability in Manufacturing Firms AU - Adebola Daniel Kolawole AU - Adesola Busola Akomolafe AU - Babatunde Johnson Olusipe Y1 - 2019/11/25 PY - 2019 N1 - https://doi.org/10.11648/j.ijafrm.20190404.12 DO - 10.11648/j.ijafrm.20190404.12 T2 - International Journal of Accounting, Finance and Risk Management JF - International Journal of Accounting, Finance and Risk Management JO - International Journal of Accounting, Finance and Risk Management SP - 110 EP - 115 PB - Science Publishing Group SN - 2578-9376 UR - https://doi.org/10.11648/j.ijafrm.20190404.12 AB - This study evaluated the degree of relationship between inventory management and profitability of manufacturing firmsin Nigeria. International Breweries Plc was adopted as case study. Secondary data were sourced from the company’s annual reports for the period of 10 years. A simple linear regression model was specified to test the correlation between variables used. Stock turnover ratio was used to capture the relationship between costs of sales incurred in generating total revenue and the inventory utilized in for production and distribution. The result generated from the study showed that the company operates an efficient Inventory Management System which has strong influence on its profitability. The correlation coefficient (r) was 85.3% while r2 was 72.7%. The study concluded that the efficient inventory management contributed significantly to profitability of manufacturing companies. The study recommended that manufacturing firms should focus on improving on their inventory management system by adopting a more efficient approach in utilizing inventory items. VL - 4 IS - 4 ER -
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