ABSTRACT

 

Inventory can be cost saving when managed strategically. It can also help an organisation improve customer service which leads to customer satisfaction and better Marketing performance. This research work concentrated on inventory management and Marketing performance in fast food restaurants in Abia state. Survey method of research design was adopted and sample size of 138 was determined using topman formula. The data collected through questionnaire as well as secondary data were analysed using Ordinary Least Square regression model and the Product Moment Correlation Coefficient. The findings show that inventory cost reduction has a significant effect on marketing performance of fast food restaurants in Abia State. There is a significant positive relationship between order quantity and customer satisfaction (r = 0.565; p< 0.05). Ordering time has a significant relationship with customer satisfaction (r = 0.875; p< 0.05) and reorder level has a significant effect on marketing performance. The study recommended that fast food restaurants in Abia State should handle inventory strategically to reduce cost and ensure availability of materials to ensure customer satisfaction.

TABLE OF CONTENTS

 

Title Page i

Certification ii

Declaration iii

Dedication iv

Acknowledgement v

Table of Contents vi

List of Tables ix

Abstract x

CHAPTER 1 INTRODUCTION

1.1 Background of the Study 1

1.2 Statement of Problem 3

1.3 Objectives of the Study 4

1.4 Research Questions 5

1.5 Research Hypotheses 5

1.6 Scope of the Study 5

1.7 Significance of the Study 6

CHAPTER 2 LITERATURE REVIEW

2.1 Conceptual Framework 7

2.1.1 Definition of inventory management 7

2.1.2 Estimation of inventory-related cost parameters 10

2.1.3 Inventory management practices 14

2.1.4 Practice of inventory management in fast foods 18

2.1.5 Customer satisfaction 21

2.2 Theoretical Framework 22

2.2.1 Economic order quantity (EOQ) models 22

2.2.2 Economic production quantity (EPQ) model 24

2.2.3 Newsvendor model 25

2.3 Review of Empirical Studies 27

CHAPTER 3

RESEARCH METHODOLOGY

3.1 Research Design		36
3.2 Population of the Study		36
3.3 Sample size Determination		37
3.4 Method of Data Collection		38
3.5 Sampling Technique		38
3.6 Reliability of Instrument		38
3.7 Method of Data Analysis		39
3.8 Model Specification	vi	39

CHAPTER 4

RESULTS AND DISCUSSIONS

4.1 Response Rate 41

4.2 Demographic Characteristics of the Respondents 42

4.3 Data Analysis 46

4.4 Discussion of Findings 52

CHAPTER 5

SUMMARY, CONCLUSION AND RECOMMENDATIONS

5.1 Summary 55

5.2 Conclusion 56

5.3 Recommendations 57

References 59

Appendices 64

 

 

 

 

 

LIST OF TABLES

4.1 :  Response rate 42

4.2 :  Gender composition of the respondents 43

4.3 :  Education level of the respondents 43

4.4 :  Marital status of the respondents 44

4.5 : Occupation of respondents. 45

4.6 : Age distribution of respondents 46

4.7 : Regression result of the effect of level of stocking

on marketing performance. 46

4.8 : Regression result of the effect of inventory cost reduction

on marketing performance. 48

4.9 : Correlation result of the relationship between

order quantity and Customer satisfaction. 49

4.10 : Correlation result of the relationship between

order time and Customer satisfaction. 50

4.11 : Regression result of the effect of Reorder level

on marketing performance. 51

 

CHAPTER 1 INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Fast food restaurants have gained increased acceptance and patronage over the years as more brands keep coming up yearly, hence increased competition and quest for market share. In 2017 alone, Kilimanjaro, Apples and Roots opened new fast food restaurants in Umuahia, Abia State to compete with already existing local restaurants that have won the heart of the consumers.

With this yearly increase in fast food restaurants in Nigeria, there is need for the managers of these restaurants to strategically plan their activities to reduce cost and serve the market better. In these decisions, inventory management is sacrosanct. Fast food restaurants deal with highly perishable products which should be taken care of with finesse to prevent causing the organisation a great loss. Stocks are kept in such a way that tasty meals are available to customer who needs them at any time of the day. To make this possible, inventory management plays an important role of storing and preserving the ingredients needed to prepare these meals to ensure they are accessible whenever they are required.

Inventory management saturates decision making in incalculable firms and has been widely considered in the scholarly and corporate circles (Rosa, Mayerle, & Gonçalves; 2010). The key questions which inventory management tries to answer are: when to order, how much to order and how much stock to keep as safety stock (Wanke, 2014).

According to Ogbo, Onekanma and Ukpere (2014), the first modern check-out system was designed by a group at Harvard University in the mid-1930s. Punch cards that corresponded with catalogue items were being used. The punch card would be perused by a PC and pass the data to the stock room which would convey the item in advance to the waiting clients. Analysts made the forerunner of the advanced bar coding system in the late 1940s and mid 1950s since they realized vendors required a better system. Ultraviolet light sensitive ink and reader are utilized to check things available to be purchased. The system did not have the computing power expected to make it work and it was excessively cumbersome. The Universal Product Code (UPC) or present day bar code was created and introduced in the early 1970s. As computing power turned out to be better, the intensity of UPC codes to help track and oversee inventory improved exponentially. Another promising innovation for tracking inventory has likewise advanced into stores, distribution centres and industrial facilities as of late.

Product information such as, type, maker and sequential number are transmitted by Radio Frequency Identification (RFID) utilizing microchip to a scanner or other data collection gadget, which are better than bar codes in a few different ways (Agha, 2010). Marketing Performance is the viability and productivity of an organisation’s marketing activities concerning market-related objectives, for example, incomes, growth, and Market share (Gao; 2010). The word 'metric' was proposed by Ambler (2000) to catch a top-level proportion of marketing performance. Early work on the measuring of marketing performance concentrated predominantly on the money related proportions of benefit, sales (unit and value) and cash flow (Bonoma & Clark, 1988).

This study is being embarked on to determine the effect of inventory management on marketing performance. In the course of this study, the independent variable is inventory management while the dependent variable is marketing performance. The targeted population consist of all licensed fast food restaurants located in Abia State. This study will enlighten organisations more on the concept of inventory management and its relevance in product availability which in turn improves Marketing Performance.

1.2 STATEMENT OF PROBLEM

According Leonard (2019), to having inventory on hand is part of creating a positive customer experience. When customers can get items quickly, loyalty is built because customers know the business keeps products in stock. One of the benefits of inventory management in fast food restaurants is that it helps restaurants to figure out exactly how much inventory they need. This makes it simpler to prevent product shortages and keep simply enough inventories available without having excessively. Fast food restaurants need to keep a high inventory turnover ratio to ensure their products are not spoilt, becoming obsolete or sucking up their working capital. Other benefits of inventory management include; cost cutting, time saving, inventory tracking, accurate planning, and warehouse organisation and employee efficiency.

All the benefits of inventory management can only be harnessed if it is practiced the right way, but there are hitches faced by fast food restaurants in Abia State. Some of the problems facing fast food restaurants today are the inability to provide quality services to the customers whose root cause lies in poor inventory management.

Stocks in fast food restaurant need electricity to be ready for the consumers. Drinks are preferred cold and meals are to be kept warm. Some uncooked perishable items need to be refrigerated. To be effective in stock keeping, fast food restaurants get to run standby generators thereby increasing their running cost and making products more expensive.

Experts are not hired to take care of inventory management and this to an extent is one of the problems of inventory management in Nigeria.

Some of the products are agricultural products which are seasonal. There are no storage facilities to keep items to make them available all year round.

Inventory management is one of the most expensive and important asset of many fast food restaurants representing a considerable percentage of the total invested capital. However, in most of these restaurants, it has been a difficult task for analyst and managers to ensure that inventory management is given its logical due consideration by top management (Ogbo, 2011).

1.3 OBJECTIVES OF THE STUDY

The main objective of this study is to determine the effect of inventory management on marketing performance of fast food restaurants in Abia State.

Specific Objectives of the study are to:

 

i. examine the effect of stocking on total sales value of fast food restaurants in Abia State.

ii. ascertain the effect of inventory cost reduction on total sales value of fast food restaurants in Abia State.

iii. examine the relationship between order quantity and customer satisfaction.

iv. examine the relationship between ordering time and customer satisfaction.

 

v. examine the effect of reorder level on total sales value of fast food restaurants in Abia State.

1.4 RESEARCH QUESTIONS:

The study was carried out to find out answers to the following questions:

 

i. How does stocking affect total sales value?

 

ii. To what extent does inventory cost reduction affect total sales value?

 

iii. What is the relationship between order quantity and customer satisfaction?

 

iv. What is the relationship between ordering time and customer satisfaction?

 

v. What is the effect of reorder level on total sales value?

 

1.5 RESEARCH HYPOTHESES

H0_1: Stocking has no significant effect on total sales value.

H0_2: Inventory cost reduction has no significant effect on total sales value.

H0₃: There is no significant relationship between order quantity and customer

satisfaction

H0_4: There is no significant relationship between ordering time has with customer

 

satisfaction.

 

H0_5: Reorder level has no significant effect on total sales value.

 

1.6 SCOPE OF THE STUDY:

The scope of this research work covers inventory management among fast food restaurants in Abia State. This research will only focus on the inventory management at the store of raw materials and processed food items.

1.7 SIGNIFICANCE OF THE STUDY:

This study is of benefit fast food restaurants that are facing problems in making products available to consumers as a result of poor inventory management strategies and lack of knowledge of the connection between inventory management and product availability which will in turn increase sales volume and marketing performance. The study is beneficial to the society at large because good service delivery as a result of good inventory management practices will increase customer satisfaction and loyalty which will in turn challenge competitors to make products available as and when due.

Lastly this research project will also be of benefit to academicians who have interest in supply chain management as it will expand their frontier of knowledge and be a foundation for more research in the future.

Buyers has the right to create dispute within seven (7) days of purchase for 100% refund request when you experience issue with the file received. 

Dispute can only be created when you receive a corrupt file, a wrong file or irregularities in the table of contents and content of the file you received. 

ProjectShelve.com shall either provide the appropriate file within 48hrs or send refund excluding your bank transaction charges. Term and Conditions are applied.

Buyers are expected to confirm that the material you are paying for is available on our website ProjectShelve.com and you have selected the right material, you have also gone through the preliminary pages and it interests you before payment. DO NOT MAKE BANK PAYMENT IF YOUR TOPIC IS NOT ON THE WEBSITE.

In case of payment for a material not available on ProjectShelve.com, the management of ProjectShelve.com has the right to keep your money until you send a topic that is available on our website within 48 hours.

You cannot change topic after receiving material of the topic you ordered and paid for.