MAKE OR BUY DECISION AN IMPORTANT PURCHASING TOOL AND A COST CONTROL TECHNIQUE IN AN ORGANIZATION

1.0 Introduction

1.1 Background of the Study

In all organization including governmental agencies. The need for efficient supplies function is highly recognized and considered. Presently the cost materials, equipment and supplies for industrial and non-industrial purposes account for a large production of the costs of these organizations.

According to Ojeoku (1993(efficient supply is achieved who the supplier the required quality and quality of raw materials. Parts tools and equipment at the right time and at a lowest price Also the supply is not efficient when the required quality and quantity of materials is not delivered and received as and when needed. If t he quality specified does meet or measure up to quality delivered, or if the organizations suppliers fails to make satisfactory adjustments for his/her errors as in the goods delivered or if the price of the item or services rendered.

Supplies is only a part of several activities dealing with the procurement of materials in the public sector. Subject of supplies hold the same basic principles and steps in all public sector.

Large supplies are usually made only after the media of publicity for tenders. In order to encourage tenders the suppliers must supply and the due delivery data in order to prevent conflict.

In this research project, an attempt is made to examine the need for efficient suppliers function in the ministry of fiancé Imo State with view to increasing efficiency in suppliers.

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1.2 Statement of the Problem

Strictly this project is a case study of the need f or efficient supplies in the ministry of finance, Imo State. The principal problem being investigated is to.

1. To determine how effective procurement of materials are being carried out within the ministry.
2. To find out or ensure if the ministry of finance Imo State carryout their supplies functions or activities effectively and efficiently.
3. This question relates to if the ministry of finance are using right suppliers regards to materials and equipment. Thee by ensuring efficiency in the public sector.
4. Do the ministry have experience workers and qualified personnel for carrying out the activities efficiently and adequate usage of materials inorder to achieve effective results or aim in the public sector
5. To determine how committed the worker are in their various area of duties or activities there by ensuring efficiency and adequate usage of time and materials in the public sector.

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1.3 Objective of the Study

The aim of this research is to reflect on the procedures being used for supplies in the pubic sector with reference to the ministry of finance Owerri, Imo State.

1. Do you have experience and qualified workers?
2. What is the rate of turnover of personnel in the organization?
3. What is the strength of the workers
4. What is the quality and quantity of your workers?
5. Do you have professional on the feed of studies

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1.4 Significance of the Study

This research work on the need for efficient supplies function in the public sector is designed mainly for

1. The researcher as a requirement fro acquiring higher National Diploma (HND)
2. It will become a source of data to other student who will write on the same topic
3. Creation of services awareness to industries, suppliers personnel, department tender board and government for the need of efficient supplies function in the public sector.
4. The firm will seat up on those areas that the researcher has critisised and on the area his/her question are based. If lacking they will seat up.
5. It will be of important use to public and private sector whose knowledge of supplies concept is still not well established.

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1.5 Research Question

• Does the ministry achieve any advantage as a result of the use of right suppliers?
• What role does suppliers function play in the pubic sector?
• Is it possible that using the right suppliers will reduce cost and as a result increase saving in the ministry?
• Does the ministry achieve efficiency as a result of using experience workers and qualified personnel?
• Does the ministry achieve effective functioning as a result of frequent staff turnover?

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1.6 Statement of Hypothesis

The null and alternative hypothesis has been set by the researcher to verify the accuracy of the data collected during the course of research work.

In carrying out this, the researcher will use both null (H) and alternative (H1) hypothesis to find out whether the roles played by supplies function in the public sector has any effect on the organization.

A hypothesis many be defined as a declaration statement of a relationship between two or more variables used for better understanding of the materials.

These assumption are thus stated below

• H0: That supplies unit cannot be managed effectively by some one without professional qualification
• H1: That supplies can be managed effectively be someone without professional qualification
• H0: The supplies department does not often experience under influence on Maters relating to supply management by other department
• H1: The supplies department often experience under influence on matters relating to supply management by other department

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1.7 Scope of the Study

This Research work is designed for the suppliers of material. The researcher carried out this work in Owerri Imo State it is strictly carried out on the bases for the need of efficient supplies function in the public sector. The researcher will be using thee staff of the ministry of finance and the supplies unit as respondents to fund out the function of supply in the sector after the findings it is seen that the supplies department of the ministry of finance Owerri Imo State has related function with other state.

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1.8 Limitations of the Study

In actual seen there are some certain constraints that seen to limit ones extent of gathering more information based on this project.

There are obviously many public sector in the state that needs to be visited for move information, but for the limitation in time and resources these some how limited the extent.

Another constraint was the uncompromising attitude of the workers of the ministry of finance. they were always very suspicious of the researcher's mission not minding the introduction made. There was also lack of relevant data in some areas that could have helped the researcher in this study However, bearing these constraints the researcher made effort to ensure that she left stone unturned in the search for materials and evidence necessary for the purpose of carrying out this research successfully.

Time of the government worker tend to be very limited and as such high schedules was the order of the day. By the time the researcher tried to locate one officer, it would be late meet the other in the office in essence, it required patience and courage to make several journeys before was able to sever information and attention of senior personnel whom the researcher felt were in better position to give more actual information.

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1.9 Operational Definition of Terms

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1. Supplies:

An executive function for the procurement of materials, parts tooling and equipment in the public sector.

2. Local purchase order:

This is a document which is issued to the suppliers before supplies or delivery of materials is made it is used within a locality or country.

3. Vendor source:

This means that a good supplier has to develop source of raw materials and components that will ensure continuity of production during scars and period of fluctuating business conditions

4. Warranties:

This is a process where the supplier assure the buyer that the product delivered or supplied will be maintained throughout it is.

5. Respondents:

This refers to all government workers. Store keepers and public sector

6. Store keepers:

Staffs that take note of all supplied materials, tools and parts

7. Storage facilities:

Pallets, racks bin etc.

8. Storage

Should be provided for proper stocking of the supplied materials.

9. Inventory control:

This is a process that involves the control of the inflow and outflow of materials in the store house

10. Safety:

This is the guaranty of safe keeping of material that are harmful to human.

11. Security:

It is a process where there is a watch man in the store house or area to avoid theft or pilfering of the materials and also flicking of electronics device such as alarm to alary danger or entry of individual or persons outside the working hour.

12. Equipment and Machines

To ensure safe handling and carriage of material from one point to other, in order to prevent materials from being damage through manual carriage.

13. Coding system:

The supplied materials should be attached with a code number and also reflect as the same in the store record for easy location and collection, also easy to identify when a materials is out of stock and also missing in the store house

14. Store record:

There must be a book for the recording of items in the store house or stock yard.

15. E. procurement:

This is the use of electronic methods in every stage of buying process. It is a range of technologies that apply the speed to computer processing and the connectivity of the internet.

16. Non-discrimination:

They should be equal opportunities to compete for pubic supplies throughout the procurement process.

17. Transparency:

The supplies must be open to the entire department or at least open to inspection by specially appointed officials

18. Accountability:

Public supplies staff must be accountable for their official act

19. Supplier Record:

It is a file maintained primarily as an aid to or den writing it is a list of all suppliers and their mailing addresses.

20. Efficiency:

This is a means of speeding up of suppliers implementation. Their should be decentralization of delusion making in public supplies and also remove unnecessary layers of approval in order to increase efficiency

21. Economy:

This is the usage of available materials or funds rightfully to achieve the aim or target s of the sector. For these to be achieved professionals should handle the public supplies in order to achieve value for money.