ABSTRACT
The
research work is basically concerned with the international procurement and its
justification. The research work covers the purchasing activities of Global
Soap and Detergent Industry limited Ilorin.
International buying is the procurement activities which involved source and
obtaining needs or requirement from a foreign country for use in another
country. International trade is particularly important to consumer in all
nations. Nations trade in what they produce most efficiently in an atmosphere
of competitive world, resulting increase standard of living for all people of
the world. This research work is divided into five chapters in order to aid a
better understanding. Chapter one is the introduction of the subject matter,
statement of the problem of purchasing in the company, scope and limitation.
The historical background of the company understudy. Global soap and detergent
industry limited Ilorin
and the definition of terms. Chapter two covers the literature review
especially on books that are more useful and relevant to the project under
study. In addition to the literature review is definition on international
buying reason for growth in international buying problem of international
buying justification of international purchasing and relationshi6 of local and
international buying. Chapter three is based on research methodology instrument
used for data collection, population and sample size statistical method used in
analyzing data. Chapter four is the presentation and analysis the data used.
Chapter five contains the discussion of the summary of findings, conclusion and
recommendations and references.
TABLE OF CONTENT
TITLE
PAGE i
CERTIFICATION
ii
DEDICATION
iii
ACKNOWLEDGEMENT
iv
ABSTRACT
vii
TABLE
OF CONTENT viii
CHAPTER ONE
1.0
Introduction 1
1.1
Objectives of the Study 3
1.2
Statement of the Problem 4
1.3
Scope and Limitation of the Study 5
1.4
Significance of the Study 7
1.5
Historical Background of study of the Case Study 8
1.7
Definition of Terms 12
CHAPTER TWO
2.0
Literature Review 15
2.1
Benefit of International Procurement 22
2.2
Justification of International
Procurement 28
2.3
Hypothesis Formulation 30
CHAPTER THREE
3.0 Research Methodology 32
3.1
Instrument used for Data Collection 33
3.2
Population and Sample Size 35
3.3
Statistical Method used in Data
Analysis 35
CHAPTER FOUR
4.0 Presentation And Analysis Of Data 37
CHAPTER FIVE
5.0 Summary, Conclusion and Recommendation 50
5.1
Recommendation 52
5.2
Conclusion 54
REFERENCES
56
QUESTIONNAIRE
57
CHAPTER ONE
1.0 INTRODUCTION
Purchasing
as a subject and as a business function has really come along way. In the past
when material, component part energy etc were abundant and available at
ridiculously low price, purchasing was not given proper chance to operate that
is why procurement was looked upon as having unimportant function.
However
now that material is in short supply there is generally on existence of what is
called galloping inflation.
These
result to high price of material or unfriendly supply market. It will be very
unreasonable for any business firms and indeed government to ignore purchasing
function.
With
these reason purchasing tends to play an important role in any business
organization whether profit or non profit oriented. In a nutshell, the project
is about the need for a company to involve international procurement.
To
a layman purchasing means the process of buying raw material, component part
and service. But in a broader sense procurement can be defined as the
purchasing of the high quality of goods at the right price from the right
sources and delivered in good condition to the right location and when
required.
Procurement
these days for organization especially profit oriented company has become very
difficult because of the international operation involved. The company has to
buy international to make its product. This nowadays firms in African countries
or content can now produce their material requirement and service from few
distance sources in American continent.
The
researcher case study of Global Soap and Detergent Limited Ilorin will at the
long run benefit in the are of appraisal made by the researchers on how foreign
buying activities are accomplished. At the end of the research work,
recommendation to solve the problem can be employed by the company to improve its
purchasing performance especially in the area of international buying.
To
the reader, especially non professional colleagues knowledge concerning foreign
purchasing would be gained and various reason for foreign buying would also be
gain.
To
the professional colleagues, how international buying is practically carried
out in a company would be learnt in addition to the theoretical knowledge
gained in the classroom.
Finally,
the society as a whole has its share or benefit to be achieved from the
project.
1.1 OBJECTIVE OF STUDY
The
research work is of importance to the researcher because if forms part of the
requirement for the award of Higher
National
Diploma in Purchasing and Supply in the Department of Purchasing and Supply Institute of Finance and Management
Studies
Kwara Poly.
The
research study will attempt to inform the organization under the study on the
roles and immense contribution of international buying.
However,
at the end of the research work, it would help to convince the management of
Global Soap and Detergent Limited llorin, that Purchasing contribution is
essential the overall corporate the organization lack of this may cause total
collapse of the company corporate plan.
1.2 STATEMENT OF THE PROBLEM
The
research study deal with international procurement and its justification in a
company. An international buying involves more complex procedure relating to
local buying. There is tendency for some problem to arise during the practice.
Among some problem encounter by the company are how to locate foreign supplier,
how to get traveling document, licensed, importation duties. More so,
fluctuation in exchange rates, instability in rate of exchange is one of the
problems frustrating the industry in which the cost important becomes higher.
Lastly,
the distance between one nation and another may so great that it makes the cost
of transportation high.
1.3 SCOPE AND LIMITATION OF THE STUDY
This
research works will cover buying for organization. Thus its scope will be based
only on international buying aspect.
Also,
the study will be restricted to the chosen company Global Soap and Detergent
Ilorin by analyzing the various procedures involved in international
procurement. The study will start right from origin of needs and ends with
clearing of the goods at what or port of entry.
They
researcher faced some problems in the course of carrying out the research work,
which range from financial problem and time factors. The researcher was also
denied some accessibility to copies of various document use in the organization
when sourcing abroad for security purpose. Also the attitudes of the respondent
create much problem. Most of them schedule a time in which they will never be
around whenever you are there.
Lastly,
the organization lack purchasing library in which
secondary
data can be yet for the researcher.
·
Theoretical Scope:
this refers to the area to be covered during the period of research work. The
area to be discussed shall be limited to purchasing and supply.
·
Geographical Scope:
The researcher shall offer useful suggestions where necessary so that the
organization could be able to advice much for progress and make valuable
contribution to see the economic depression of this great nation.
·
Industrial Scope:
The researcher will focus more attention on the purchasing department with
particular reference of Global Soap and Detergent Industry as regard their
activities.
·
Time Scope:
This is where the researcher would use his time to spend for collecting data
from the organization in order to get facts from them.
1.5 SIGNIFICANCE OF THE STUDY
If
international buying is effectively and efficiently carried out, it is possible
to derive vital in gain from it. Global Soap and Detergent llorin derives the
following important from overseas buying.
1. Better
quantity material: Material of best quality are got from overseas due to their
technological advancement.
2. Increase
in prefer to buy foreign goods because it is mostly cheaper when compared to
local source because of lower wage, longer runs, better product, better plant
and some other important which might at long run reduced the amount to be paid
for the gods. In this wise, this tends to increase the profitability of the
company used as a case study, Global Soap and Detergent Ilorin.
3. Better
quality material spark parts, component are got from international market.
1.6 HISTORICAL BACKGROUND OF GLOBAL SOAP AND
DETERGENT
INDUSTRIES LIMITED COMPANY PROFILE AND CITATION
INTRODUCTION
Global
Soap and Detergent Industry Limited is a member of the Doyin Group of Companies
and the first indigenous company licensed to manufacture soap and detergent in Nigeria.
It was in corporate on 8th October, 1984 with head office at Lagos
and the factoring situated at Amuda Aluko way llorin, Kwara State.
OWNERSHIP
AND MANAGEMENT
The
company is operated managed and directed by full blooded Nigerians. Owned by
courageous and experienced industrial 1st prince (Dr) Samuel Adedoyin who led
for many years been championing indigenous technology, backward integration and
the use of local raw material in Nigeria.
Global
Soap and Detergent Industry was established in response to the call of the
Kwara State Government in industrializing Kwara State.
Price Adedoyin is the chairman and managing director. The affairs of the
company are managed under the Leadership of Mrs. Omolola Olobayo, the Executive
Director. Member of the management team also include a list of manager with
Engr T. N Njoku as the general manager.
The
company operates the following department: personal and administration,
technical, production, accounts, sale, marketing, audit, purchasing
laboratory/quality control raw materials silicate, sulphonation and
distribution department.
FACTORIES
The
company has greatly contributed to the growth of the Nigeria economy through
industrialization. Despite the economy downturn, the company has metamorphosed
from its one detergent factory and a pioneer staff strength of 40th in 1985 to
the present conglomerate of seven factories with a staff strength of over 1000.
THE
DETERGENT PLANT
The
detergent plant is a Sabiz Italian plant. In 1993 it was up graded to a 10 ton
per hour capacity. The product are mainly detergents and the following one the
brands presently being produced: flash blue detergent (200gm) bold detergent
(10kg, 5kg,lkg, poly and sack) wash (10kg, 5kg, 2kg,lkg poly and sack) and
super deal (200gm).
SULPHONATION
PLANT
This
is a 10 ton per hour plant commissioned in 1994 upgraded to 1.6 ton per hour. The
main product is sulphonic acid which is a raw material used for the production
of detergent powder and detergent bar.
SOAP
PLANT
This
soap comprises 1.0 per hour each of toilet soap and laundry soap. The plants
were commissioned in 1990. The product are Hielean bar soap (600gm), Bold
tablets (110gm) Bold tablets (200gm) vogue toilet soap (95gm) grand tablets
(150gm) vogue quest soap (30gm) med soap antiseptic soap (25gm).
GLYCERINE
PLANT
The
glycerin plant uses lye which is a by product of soap
production
as a raw material to produce glycerire. The plant is a 0.1 ton per hour
capacity and was commissioned in 1992.
DETERGENT
BAR PLANT
The
detergent bar plant which has a capacity of 1.0 ton per day commissioned in
1994. The product is bold detergent bar (400gm).
SILICATE
PLANT
This
furnace produces sodium silicate which is a raw material for the production of
detergent, soap and detergent bar. The plant which is a 10.0 ton per day was
commissioned in 1993 two similar furnace are sited in Lagos.
SCOURING
POWDER PLANT
This
is 1.0 ton per plant within the detergent plant, it was commissioned in 1989
and produces Hiclearn scouring powder (600gm). Ninety nine percent of the raw
material used to produced scouring powder are obtained from Kwara State.
SALES
AND MARKETING
The
company’s range of product has confirmed to enjoy good patronage from Nigerians
due to the consistently high quality, it is on record that global soap and
detergent industries is the first company to have received the NIS certification mark for
quality within its first 3 years of operation. The company’s products which
have NIS
certification mark for quality are flash blue detergent, super deal blue
detergent, wash rite blue, detergent and vogue toilet soap.
As
a way of researching the nooks and crannies of the country the company has 22
sales deports located all over the federation viz Aba, Abeokuta, Benin, Enugn,
Gombe, Ibadan, liorin, llupeju Lagos, Marinland, Jimeta, Jos, Kaduna, Kano,
Maiduguri, Gusau, Katsina, Ondo, Onitsha, Sokoto, Uyo, Minna and Ado Ekiti. In
addition, their product have been introduced to countries within the ECOWAS
sub-region as a way of earning foreign exchange for the country. This is
achieved through direct consumer contract opening of depots and encouraging
distributors.
1.6 DEFINITION OF TERMS
C.I.F: This simply means Cost Insurance Freight which
indicate that the seller is responsible for the goods until they get to the
port of destination and the selling price includes ocean freight and insurance
up to that point.
Duty: Payment made to the government either
for import or export.
C and F: Cost and Freight This is similar to C.I.F
except that buyer has to pay for insurance charges.
Bill of Lading: This is a document similar to delivery note
used in shipping. The sender retains one copy is held by the master of ship and
note also for consignee.
Port of Entry: This is importer! buyer country part i.e
through which consignment will entre its country of destination.
E.T.D Estimated Time of Department:
This is a note send to the
importer stating the time the vessel leaves the port of exporter.
E.T.A Estimated time of Arrival: It is a note send to the importer given
him the time consignment will arrive at his country port.
CRF
Clean
Report of Finding: Pre-shipment
inspection of goods to be shipped to Nigeria must be ensured that they
are of correct quality and that only normal contract material importer are
shipped.
Carrier:
This is a company offering the service
of transporting good from one area to another.
F.O.B Free on Board: This is a contract in which good are delivery t
the ship (no board).
Consignment Note: A note accompanying consignment of goods
indicating quantity, description, number of package in the consignment.
Consignee: The person or company to whom goods are
addressed or sent.
Commercial Invoice: The invoice is often employed as basis for
custom clearance at the port importation.
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