THE ROLE AND CONTRIBUTION OF PURCHASING AND SUPPLY IN THE PROFITABILITY OF AN ORGANIZATION

1.0 Introduction

In the recent part, emphases was only on the balance sheet report without cognizance of other factors that made up the inflow and outflow of resource that sustain the mechanism of a given firm. with recent emphases on cost control in the face of the rising cost of input resources and subsequent spill over of high cost of purchasing and supply management in a manufacturing company.

After the civil war, the attendant from in production resulting from the growth of private sector enterprises from Europe and America began to awaken other management inputs for eventual profit. The reason is based on the sophisticated resources part in by these multinationals into the mechanism of our business sector.

It is imperative to note that the concept of purchasing has been broadened since the turn of the country, to include all those business activities relevant to the securing of materials suppliers and equipment as well as service needed by business and industries.

As at date, the cost of materials and supplies for industrial and non-industrial purposes accounts for a large proportion of the cost of these manufacturing company. In most of them, this represents over 65% of their total expenditure (Oyeoku O.K. 1993). Therefore, purchasing is referred to as department which is concerned with the process of defining the manufacturing company's needs selecting suppliers, agreeing terms placing orders receiving goods and function which is oriented to purchasing complete supply function which is user within the manufacturing company (R.E.J. Nwanneka).

English Oxford Advanced Learners Dictionary of current English, third edition, simply defined the world purchasing as just buying. We will however, take purchasing mission to be selection of materials or services agreement of prices and acquisition items. A well organized purchasing is one of the criteria for a company to minimize cost at the same time increases profit. The impact of purchasing and supply management towards ensuring repaid growth in a manufacturing company's cannot be over emphasized.

It has been sampled and proved that, a layman in the field of purchasing easily views purchasing function as obtaining requisitions negotiating and placing order without the knowledge that purchasing goes beyond this areas of activities.

For a company to succeed or to achieve its desired objectives, it means that those required manning the materials section of the manufacturing company should be highly trained and knowledge in the field of purchasing. And other materials related functions, in order to harness effectives and efficient profitability to their manufacturing company. In view of numerous challenges of the profession requires a caber of persons that can exercise prudence and sound judgment for any naira spent at ay given point in time, in order to minimize cost and increase profit.

Sincerely speaking, these cannot be achieved of the buyer is not a professional buyer that should adhere, strictly to the ethics of the purchasing profession and techniques of purchasing practice. Quite unlike untrained buyer, a trance and professional purchasing executives is aware that he is bound by the ethics of the purchasing profession.

Therefore, his first and primary obligation is integrity in spending his company's fund, showing professional competence in representing his manufacturing company outside etc. it is in line with this that the researcher tends to study the roles and cusing Nigeria Breweries company plc.

1.1 Background of the Study

Nigeria bottling company plc was originated as a soda function beverage in 1886 selling for five least. Early growth was impressive, but it was only when a strong bottling system that coca-cola become the world-famous brand it is today.

1884 – A modest start for a bold idea. Since the emergence of this organization, it has snifter to the market and consumers different types of soda fountain beverages.

The number of soda fountain beverages sent to our market by this bottling company plc, in doubt has made tremendous impact on the reduction of the micro economic variables problems in this country through generating to our economy, creation of job opportunities etc the management of Nigeria bottling company plc is a public liability company.

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1.2 Statement of Problem

Business conditions during the recent past placed much strain and pressure on the purchasing management function and roles. Critical materials shortages, worldwide inflation and arbitrary action of government seriously interfered with the orderly operation of business.

Materialism is the source of out present day Nigeria society and people who are responsible for purchasing function in Nigeria bottling company plc Aba, and other good (public) companies however, purchasing management and its allied subject are the newest course read full-time in some higher institution of higher learning, and more than seventy percent of firms in Nigeria are yet to embrace this in its most meaningful and realistic dimensions.

Much corporate management has been made painfully aware of the shortcomings of the operation of their firms' materials management function. Indeed, it is among the best of the specialized business functions, to be centralized and given the responsibility and authority for making profit progress in this area of business management is thus just beginning. The development of purchasing role and function in the (public sector) Nigeria bottling company plc Aba has been badly affected by the “buying syndrome”.

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1.3 Objective of the Study

This study is carried out with the following objective

1. To examine the various, role of contribution of purchasing and supply on the profitability of an organization available and evaluate their application.
2. To make critical study of problem in the services offered by the firm and suggest solutions to these problem.
3. To formulate the role of purchasing strategies that would be.

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1.4 Research Questions

• Does purchasing have any role to play in the manufacturing company?
• Is purchasing contributing to the profit in the manufacturing company?
• Is purchasing recognized in this manufacturing company?
• Is the purchasing manager solely responsible for buying materials and other items for your manufacturing company?
• Is the purchasing manage professional qualified in such areas the purchasing and supply management or is he/ she just qualified through job experience?

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1.5 Significance of the Study

This study intends to the beneficial to three main categories of people that is. To the manufacturing company, the student and researcher.

To The Manufacturing Company

The findings of this study will acquaint it and shall also discover through this study a competent and well trained professional who can effectively manage and handle the taste of buying or purchasing in the most economic manner hereby increasing the profitability and growth of the manufacturing company and reducing waste.

to the Student

The findings of this study will enable the student to appreciate the course the more, it will also make them to be more economical, wherever they are to purchase materials, they must purchase materials in high quality, but at a lowest cost.

To The Researcher

The findings of this study will help the researcher the more, the advantages, impact of purchasing and supply management in a manufacturing company. To know or to indentify problems area in purchasing and supply function and develop strategies to solve item. The data gotten can be used for reference purposes.

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1.6 Scope of the Study

1. The study is the role and contributions of purchasing and supply in the profitability of a manufacturing company.
2. The study was limited to the Nigerian Bottling Company due to time and other resources constraints the staffers to the company whose works relate to this topic were interviewed.

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1.7 Limitation of the Study

The researcher in the course of carrying out his research work has contended some factors that limited in one way or the other against the zeal posed, they include the following.

Finance:

The research being a full time student at the time of making this research found it difficult to make ends needs with the little savings he made while working.

Time:

The researcher being a student and has a lot of academic work to pursue and some other things, has time constraint, instead of examine all the variables in purchasing n most of the notable industries, limits his study to only Nigeria Brewery plc.

Non-Response:

Most people interviewed were ignorant of what is called research, so they failed to give elaborate information about their manufacturing company despite the fact that the researcher told them that all information given would be confidential. Again, I found it very difficult to find good books relating to purchasing in the Federal Polytechnic Library, so I had to run round to many places for data collection of this.

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1.7 Limitation of the Study

In carried this research, the research was cooperated with a number of limitations. Due to finance and time constraints, the research was unable to examine all the variable in purchasing in all the leading. Public and private companies, limitation his study to a few public enterprise themselves incomplete.

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1.8 Definition of Terms

Purchasing:

Is the process involving planning, and strategy designed to obtain value for money spent.

Vendor:

This focuses on the knowledge of selling and buying the person that supplies goods to the buyer is the vendor.

Negotiation:

Negotiation is a conference between one party or person with another party or person with a view to arriving at a consensus.

Material Handling:

This is the process by which materials are being moved, handed and stored with in and around an establishment with the use of hand or mechanical equipment.

Organization:

An organization is a group of people who from a business with the aim of making profit or achieving an objective.

Store House:

A storehouse is a building designing to keep materials until when there are needed by the uses

Storekeeper:

Is a person who keep or operation the systematic procedure of recording transaction in the storehouse so that materials held in store will be safeguarded.

Storekeeping:

Storekeeping is a systematic procedure of recording transaction in the store, so that at any given time, the stock record we show the actual stock position of each material held within the store organization.