ABSTRACT
This
project has been specially written to cover “make or buy decision as important
tool for profitability in a firm” with particular reference to global soaps and
detergent industries Ltd, Ilorin.
The term “purchasing” is used in industry to denote the act of the functional
responsibility for procuring materials, supplies and services.
However,
in a narrow sense an considering the topic make or buy decision as an important
element for profitability, the term supply describes the process of buying and
in a broader sense, the term determine the need, selecting the supplier,
arriving at proper price, terms and conditions, issuing the order, follow up to
ensure proper delivery.
This
project work is divided into five (5) chapters. Chapter one of this project
discussed the introduction of the subject matter, statement of general problem,
rational behind the study, scope and limitation of the study, historical
background of the organization and definition of the term used.
Chapter
two contains details of different type of literature review on the subject of
make or buy decision.
Chapter
three entails the research method used, instrument used in data collection,
research population and sample size, sampling procedures used, statistical
techniques used in presenting and analyzing data setting of hypothesis.
Chapter
four deals with presentation and analysis of data, interpretation of data,
reason behind make or buy decision at global soap and detergent industries ltd,
Ilorin, benefit of make or buy decision to Global soap, and detergent
industries Ltd, Ilorin and testing of hypothesis.
Lastly,
chapter five comprises of summary of finding, conclusion and recommendation as
considered necessary for implementation and recommendation.
TABLE OF CONTENTS
TITLE
PAGE I
CERTIFICATION
II
DEDICATION
III
ACKNOWLEDGEMENT
IV
ABSTRACT
VII
TABLE
OF CONTENT XI
CHAPTER
ONE
1.0 Introduction 1
1.1 Statement
of Problems 2
1.2 Rational
for the Study. 3
1.3 Scope
of the Study 4
1.4 Limitation
and Constraint
5
1.5 Historical
Background and Organizational chart 6
1.6 Definition
of terms. 12
CHAPTER
TWO
2.0 Literature
Review 14
CHAPTER THREE
3.0 Research
Methods Used 41
3.1 Instrument
used in Data Collection. 42
3.2 Research Population and Sample size 44
3.3 SAMPLE
PROCESSING USED 45
3.4 Statistical Techniques in Presenting and
Analyzing Data 45
3.6 Setting
of Hypothesis 46
CHAPTER
FOUR
4.0 Presentation
Analysis of Data 47
4.1
Interpretation of Data 59
4.2. Reasons
behind Makes or Buy Decision at Global Soap and Detergent Industries Limited
Ilorin. 62
4.3.
Benefits of Make of Buy Decision to
Global Soap and Detergent Industries Limited Ilorin. 64
4.4
Testing of Hypothesis. 66
CHAPTER
FIVE
5.0 SUMMARY
OF FINDINGS 68
5.1 CONCLUSION 70
5.2 RECOMMENDATION 71
REFERENCE 73
CHAPTER ONE
1.1 INTRODUCTION
The decision to either make
or buy material required for production processes and other purpose is very paramount
most especially in manufacturing
companies such as global soap and detergent industry limited Ilorin. Many organizations consider it profit
ability o manufacture (make) the material required in he house, if here are
enough facilities to embark on such,
while the decision to make materials in house is considered wrong by some
organization due to their lack of enabling facilities or simply says they are
not aware of the benefits there in.
The decision has regard
to make or buy should not be handling with levity. These is so because, failure
to make appropriate decision here is the beginning of failure. Many organizations are facing problems today
just because they take the decision that is most profitable for their concern. However this decision often seems to be taken
as required by design, production and purchasing department.
In considering these
decisions it is worth not things than 50% of company’s annual budget spends by
the purchasing department, and millions of naira is lost
annually as a result of purchased items.
It would therefore be more economical to decide whether to make or buy
material required.
(A) Cost
:- the cost associated with manufacturing needs materials in house and the
current cost f purchase, if material must be bought, it determine which one is
cost effective.
(B) Availability
of product capacity:- the firm should consider whether
there is enough person machinery and technical know how that would be place
then, the firm ma embark on “make” decision and if otherwise, it has to locate right
source a supply form who to buy.
1.2 STATEMENT
OF PROBLEMS
The common problem that
faces many organization including global soap and detergent industries limited Ilorin. Toda is how to make appropriate decisions
concerning whether to make or buy materials required in organizations out of
the race, while some fail to record substantial profit in their business
endeavors.
The
inability for their inability for their organization may lead to production
stoppage if the required materials are not in a place at the right time or it
may lead to loss of profit as a result of excess investment on inventory.
All
these problem needs to be systematically investigated. To know the possible
causes so that lasting solution may be prefer.
1.3 RATIONAL
FOR THE STUDY.
The research study is
directed toward the practical approaches of make or buys decision as an
important tools for profitability in global soap & detergent industries
limited Ilorin.
This
study is aimed at giving the global soap and detergent industries limited Ilorin an insight into the
essential steps to making or buying and how best the company profit could be
maximized.
The evaluation of
making or buying of items used in global soap and detergent industries
constitute a purpose of this study. The interests of the research in the
manufacturing sector lies in the fact that make or buy decision constitute the
most important part of current asset of manufacturing firms.
1.4 SCOPE OF THE STUDY
The scopes of this
research works in centered on make or buy decision as important tools for
profitability in manufacturing industry limited.
In carrying out he
research, the research in make of buy decision. It will also review briefly the
factor to be considered in make or buy decision. It will also review who
determine what to make or buy and the effect of these decision on each department
in the organization.
The
research can cover the advantage and disadvantage of make or buys decision in
an organization and weather the quality or product rises and falls with make or
buy decision at global soap & detergent industries limited, Ilorin.
Therefore,
the suggestion and recommendation made as a result of this study will be
of benefit to management to the limited
mentioned above on make or buy decision.
1.5 LIMITATION
AND CONSTRAINT
During
the process of the research works encounter numerous problems among which are:-
·
Finance
·
Time
·
Attitude of respondents.
This research work was
faced with so many obstacles and problem it was difficult to obtain the
co-operation of personnel in charge of vital document containing information
about the topic. There was the need to
travel o collect information or the other,
and in most cases, here will be no tangible result, the researcher only
being asked ask o come back.
Another problem faced
by the research was finance. The researcher often found it highly impossible to
travel to the firm location.
The research also found
out that it is not easy to combine the normal class lecture with written of
these project work management invariably become a watchword for the researcher.
1.6 HISTORICAL
BACKGROUND OF THE ORGANIZATION
The global soap &
detergent industries limited is a member of the Doyin group of companies, and
the firs worthy indigenous soap and detergent
manufacturing company in Nigeria.
It was incorporated on 8th October 1984 with hand in Lagos and factory situated along Asa-dam road, Ilorin
Kwara state capital, the company is operated, managed and directed by full blooded
Nigeria.
Own by courageous and
experienced industrialist Prince (Dr) Samuel Adedoyin who has for many years
been championing indigenous technology background integration and use of Local
raw materials in Nigeria Global soap and detergent Industries was established
in response to the call of the Kwara State Government and indigene of the State
to join hands with the state government in industrialization Kwara State.
Despite the economic
downturn at time the factory metamorphosed tremendously from its one Detergent
factory and a pioneer staff strength of 40 in1985 to a conglomerate of (7) seven factories in 1994 with a strong
belief in self reliance and resourcefulness, sourcing about 40% of its raw
materials locally.
This is one way by which Global Soap and
Detergent Industries has contributing significantly to the country’s economic
rehabilitation and industrial revolution.
The company has consistently paired up with existing
multi national detergent manufacturing company in competition toward enhancing
the growth of the Nigerian economy operating through the under mentioned
plants.
|
S/N
|
NAME OF PLANT
|
CAPACITY
|
PRODUCT
|
|
1
|
Detergent plant
|
10 ton/hour
|
200g flash bold(10kg,5kg,
2kg, 1kg) wash rite (10kg, 5kg, 2kg,
and 1kg).
|
|
2
|
Scourer plant
|
1 ton/day
|
Hi-clean scourer in poly canisters.
|
|
3
|
Soap
plant
|
2 ton/hour
|
Toilet soap, vogue, grand H-clean.
|
|
4
|
Sulphonation plant
|
1.0 ton/hour
|
Sulphonic acid (raw materials for
production of soap $ detergent).
|
|
5
|
Glycerin evaporation plant
|
|
99% glycerin (raw material for
production of pharmaceutical cosmetic.
|
|
6
|
Silicate plant
|
10 tons/day
|
Silicate raw material for production
of detergent soap.
|
|
7
|
Detergent plant
|
1.0 ton/hour
|
Detergent bar.
|
Besides the infrastructural enhancement of Kwara state,
Global soap $ Detergent industries limited existence has provide handsome
business and employment opportunities for thousand of Nigerian such as
suppliers, manufacturers, contractors, transporters, and distributors e.t.c.
The
company is blessed with most modern technology available and the plants are
ably manned by qualified personnel.
Presently, the company has an entirely indigenous labor
strength 1,000 (one thousand) workers in different grades. The company gives
priority to industrial safety and good keeping. Hence solid wastes are
periodically lifted by sanitary inspectors from the Kwara state environment
protection agency (KWEPA), thus generating revenue to the state government.
The
company’s range of product has continued to enjoy good patronage from Nigerian
due to their consistently high quality. It was recorded that global soap and
detergent industries is the first company to have received the certification
mark for quality within its first 3 years of operation.
As
a way of reaching the nooks of cram my of the country, the company has 17 sales
depots scattered all over the federation such as Aba, Abeokuta, Benin, Enugu,
Gombe, Ibadan, Ilorin, Ilupeju , Jimeta, Jos, Kaduna, Kano, Maiduguri, Ondo,
Onitsha, Sokoto, and Uyo. In addition, necessary machinery has been put in
place and negotiations have also reached as advanced stage to introduce the
company’s products to countries within the ECOWAS. Sub-region as a way of
mobilizing foreign exchange into the country.
1.7 DEFINITION OF TERMS
1. Make: - It is used to act
of producing certain things.
2. Buy:-Is an idea of
getting one’s need in return for the money paid or getting by a price.
3. Understanding: - Not
giving pleasure or satisfaction from need or desire.
4. Supplier:-One whose
responsibility is to supply or make available material for further usage either
for production or normal consumption.
5. Capacity: - Ability to
contain, hold or get hold of something.
6. Production:-It is the process
of producing or making an item.
7. Stabilize: - To make
steady or allow to be normal.
8. Delivery: - It the act of
delivery goods where they are needed or required.
9. Standard:- Quality
description of an item.
10. Investigation:-
It is an act of carefully linking in to or through inquiry which must have been
raised.
11. Specialization:-To
make or ensure that each performs an aspect where in he/she could be better
which leads invariably to perfection.
12. Sub-contracting:-
It is a situation where in part of the job is let out another contractor to
perform.
13. Quality:
- Is anything that conforms with one’s predetermine standard.
14. Specification:
- Is a definite description of what is wanted.
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