TABLE OF CONTENTS
Content
Title page
Certification
Dedication
Acknowledgement
Abstract
Table of content
CHAPTER ONE; GENERAL INTRODUCTION
1.1
Background Information
1.2
Statement of research problem
1.3
Significant of research problem
1.4
Aim and objective of the study
1.5
Scope of the study
1.6
Limitation of the study
1.7
Definition of term use
CHAPTER TWO; LITERATURE REVIEW
2.2
How make or buy investigation originate
2.2
Suggested reason behind the decision to
make part previously bought
2.3
The volatility of make or buy decision
2.4
Procedure and personal involved in make
or buy decision
2.5
Empirical
CHAPTER THREE; RESEARCH METHODOLOGY
3.1
Research method used
3.2
Historical background of okin biscuit
Manufacturing industry L.T.D.
3.3
Hypothesis formulation
3.4
Instrument used for data collection
3.5
Research population and sample size
3.6
Sampling procedure used
3.7
Statistical techniques in presenting and
analysis data
CHAPTER FOUR
4.1
Presentation and analysis of data
4.2
Testing of hypothesis
CHAPTER FIVE; SUMMARY OF FUNDING, CONCLUSION AND RECOMMENDATIONS
5.1
Summary
5.2
Conclusion
5.3
Recommendations
REFERENCE
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND INFORMATION
The
“Purchasing” is widely used in industry, commerce, public corporation and
management to donate the act of and the functional responsibility for procuring
materials, supplies and service. The research is aware that most serious
problem facing the world today are the scarcity and the growing trend toward
higher cost of materials and service. But it is amazing that purchasing, which
can be so vital to an organization, yet many still little understood. Although
the function spend a signification portion of every income of an organization,
yet many still look upon it as little and not more, than a clerical or routine
activity. Too many people assumed the function is just simple exercise of
processing requisition and placing order. Professional purchasing however, is
not a clerical task. However, in a narrow sense and considering the topic make
by decision as an important tool for increasing profit ability, the term
determines the need, selecting the suppliers, arriving at proper price, term
and condition issuing the order, follow up to ensure proper delivery. The basic
element involve in the performance of the purchasing function at Okin biscuit
manufacturing industry limited, Igabo. Offa are obtaining the proper equipment,
material, supplies and service that are needed, were they are needed at the
right time , at right place, in the right quantity and quality, from the right
source through the minimum effort and cost taking into consideration make or
buy decision as an important tool for increasing profitability at Okin biscuit
manufacturing industry ltd, Ijabo, Offa. Before any purchasing order is raised
at Okin Biscuit manufacturing industry L.T.D, decision as to be made were the
item in question is to be purchase or .
Manufacture
internally as it will be necessary. This decision regarding what to purchase or
make essential the decision of top management. In practice, the decision often seem to be taken
as require by design, production or purchasing people acting together or
separately with no writing policy guide and no apparent provision for periodic
review. There is need to distinguish between decision and strategic decision.
Make or buy decision taken at department level are those, which simply apply,
to the existing policy they are tactical decision, when a change in the policy
is invariably considered, it is then these decision are taken at higher level
were the company’s strategy is decided. Considering make or buy decision, it is
worth nothing that 60% of company’s annual budget is spent by the purchasing
department, and million of naira are lost annually as a result of purchasing
items. It would therefore be more economical of purchasing item. It would
therefore be more economical to decide whether to make or buy. This was the conclusion
of cullintin’s research first published in 1942 and subsequent investigation do
not reveal that there is considerable improvement ever since culminating found
that make or buy decision often attract less attention than needed and it tend
to be taken on the basics of incomplete
or inaccurate information and for year without being re-considered,
although they have change significantly,
1.2 STATEMENT OF RESEARCH PROBLEM
General
problem in this research includes whether to made or buy in the organization
set up, this has to be given a special focus in order not to miss usefulness.
At the initial stage, they may be very tendency for the organization not to
make it at all in that the level of profit maximization may be very low and it
may lead to the close down of the firm in the future.
The
company even find difficult to achieve
its present objectives if it fails to run smooth production at a given period
or, as started, as to be able to meet the demand of its terming customer.
A
merchandising firm will run the risk of loosing customer with out adequate
supplies to meet the request of customer
Decision to either make or buy
constitutes the most significant part of the current production of most
manufacturing/ merchandising firms, which indicate clearly that substantial
amount of money is committed to this important tool. It is essential therefore
to efficiently monitor the decision to either and over-investing.
1.3 SIGNIFICANCE OF THE
STUDY
Apart
from the researchers, there are other parties to whom the research work is
remarkably significant and could benefit from the client company i.e. Okin
biscuits, Offa is also an advantage of
gaining from the research work as it focused on its operations as the subject
matter.
reference
company could benefit in the area of purchasing and supply impact made by
the researcher. Lastly, the professional colleagues will equally learn much
bout make or buy decision as practically carried at in the manufacturing
industry in which is an additional knowledge which has been learnt already in
the lecture room.
1.4 AIMS AND OBJECTIVE OF THE STUDY
Purpose of this project is to contribute
to the standard and buying performance of an organization. It also aimed at;
a. To examine ways which manufacturing
organization can achieve corporate goal in the area of profitability, lower
operating cost, lower cost of finished project by applying make or buy decision
in the strategic planning process.
b. To make recommendation on area of improvement
of the company’s make or buy decision
C
. to control
the standard and by buying system of
performance of organization.
1.5 SCOPE OF THE STUDY
The
scope of this research work is based and centered on core areas of make or buy
decision i.e who determine what to make or buy and the effect of this decision
on the organization profit.
In
order to consider the scope of making or buying decision, there is the used to
actually know that before purchase orders are raised, a decision is made
on whether the item is question is to be
manufactured or bought as the case may be.
The
basic element involved in the performance of this purchasing function are,
obtaining the proper equipment, material and service that are needed and where
they are needed at the right price, time, quantity and quantity with minimum effort.
It
covers all facts of purchasing in okin Biscuit ltd, Offa. For example, whether
the decision has reduced the storage Space or has added to it, whether it aids
quick distribution of products, whether quality of product rise or falls with
make or buy decision at okin biscuit L.T.D, offa.
1.6 LIMITATION
OF THE STUDY
There
cannot be any successful research of
this nature with out encountering
some difficulties which might cause it success or failure. Difficulties in
securing some of the vital document containing some valid information relating
to the subject matter because of like-worm attitudes of some officers who are
suppose to assist in the research work. This occurred with the view that such a
research be of immense improvement in their performance.
The
researcher also found out that it was not easy to combine the normal class
lecture with the writing of this project
work hence, time management invariably become a
watchword for the researcher. Finally, the research often finds it
highly impossible to travel to the firm’s location because of financial
constraints
1.7 DEFINITION OF TERMS USED
Make:
it is the act of producing certain things.
Buy: is an idea of paid or getting by paying a
price
Policies:
the plan of action to be taking by management of an organization, policies
define the boundaries within which decision can be made and directed towards
the accomplishment of objectives.
Decision:
it is the act of the making up of mind about certain things.
Capital
equipment: is the Installation of equipment such as plant, machinery and other
major equipment used directly for production of good and services.
Purchasing policy and procedure
audits: this is used to determine if established
purchasing policy and procedures are being added here to.
Purchasing:
is the continuous management process that is responsible for anticipation,
identification and the provision of the good and services that are required by
an organization with objectives of increase organization profitability.
Production:
it is the process of producing or making an item.
Capacity; Ability
to certain, hold or get hold of something.
Unsatisfactory:
Not giving pleasure or satisfaction from need or desire.
Specification: Is
a definite description of what is wanted.
Supplier:
one which responsibility is to supply or make available for further usage
either for production or normal consumption.
Standard:
it is a model with which something is compared.
Quality:
is anything that conforms with one’s pre-determined standard.
Evaluation:
evaluation in purchasing is required to ensure that progress is being made
towards objectives according to plan. Is part of the control process?
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