NATURE OF RAW MATERIAL MANAGEMENT PROBLEM IN THE NIGERIAN MANUFACTURING SECTOR
There are critical problems associated with raw material management in manufacturing organizations in Nigeria today. These are rarely given adequate attentions due to inability of people involved to trace the problems to raw material management.
This writer had in an empirical study traced the following problems to inefficiency in raw material/inventory management in Nigeria:
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This often led to inability to meet customers’ order and eventual loss of market shares. Low capacity utilization and loss of revenue as consequence of these problems led to closure of many manufacturing firms in the country.
2. The poor liquidity position of many manufacturing concerns in Nigeria is a matter of concern to many shareholders and stakeholders alike. To hold too much stock than necessary will lead to capital lock-up in inventory of raw materials. The materials held idle in stores have values attached to them; and the likelihood is that the organization will never regain the money in them if they become obsolete and useless.
3. In many manufacturing concerns in Nigeria, there is inadequate provision of good quality manpower in stock maintenance and material management. This is indeed, a serious issue since employees are those charged with the responsibility of monitoring progress and reporting impending insufficiency. They are to ensure that stocks are properly kept and protected against fire and other disaster or loss. The “people” are to ensure efficient use of warehouse facilities and space; keep proper and adequate records (Akindipe, 2005).