Impact Of Purchasing Research On The Purchasing Function
(A Case Study Of Nigerian Breweries Plc Owerri, Imo State)
Research on purchasing plays a crucial role in enhancing the efficiency and effectiveness of the purchasing function within organizations. By delving into various aspects such as market trends, supplier capabilities, and cost analyses, purchasing research enables companies to make informed decisions that optimize their procurement processes. This research empowers purchasing professionals to identify cost-saving opportunities, negotiate favorable terms with suppliers, mitigate risks, and strategically align purchasing strategies with organizational goals. Additionally, it facilitates the adoption of innovative procurement practices and technologies, enhancing competitiveness in the market. Ultimately, the impact of purchasing research extends beyond mere transactional activities, fostering strategic partnerships, improving supply chain resilience, and driving sustainable value creation for the organization.
This work is about purchasing research “the impact of purchasing research to the purchasing function of an organization, with a particular reference to Nigeria Bottling Company Plc, the introduction part gives us what the project is all about the overview, objective of the study, significance of the study, research questions, scope of the study, limitation of study and definition of terms. Chapter two reviews the related literature how important they are in the organization. Chapter three is the methodology and chapter four shows the discussion of findings associated with the research work. Thus were made into the view of highlighting a sound basis for some possible solution. Chapter five witness the climax of the research rounded up by summarizing and concluding all the findings during the investigation and the research finalized by giving some recommendation which will help to improve the effectiveness in the Nigeria Bottling Company.
Title Page:
Approval Page:
Dedication:
Acknowledgement:
Abstract:
Table of Content
Chapter One:
1.0 Introduction
1.1 Background of study
1.2 Statement of the problem
1.3 Objectives of the study
1.4 Research question
1.5 Significance of the study
1.6 Scope and limitation of the study
1.7 Limitations of the study
1.8 Definition of terms
Chapter Two:
Review of Related Literature
2.0 Introduction
2.1 Research as a veritable tool for problem solving
2.2 General overview of the purchasing function
2.3 Why purchasing research is becoming important
2.4 Importance of purchasing research
2.5 Organization of purchasing research
2.6 Area of purchasing research
2.7 Relationship between purchasing research and company’s profitability
2.8 The impact of purchasing in the profitability of an organization
2.9 Summary of literature review
Chapter Three:
Research Design and methodology
3.0 Introduction
3.1 Research design
3.2 Sources of Data
3.3 Population of the study
3.4 Sample size and sample techniques
3.5 Validity and Reliability of measuring instrument
3.6 Method of data analysis
Chapter Four:
Presentation and analysis of data
4.0 Introduction
4.1 Presentation of Data
4.2 Analysis of data
4.3 Interpretation of result
Chapter Five:
Summary, conclusion and recommendation
5.0 Introduction
5.1 Summary of findings
5.2 Conclusion
5.3 Recommendations
References
Appendix
Questionnaire
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
This is a research study on the impact of purchasing research on the purchasing function. This research problem is written to analyze critically the strategies involved in the impact of purchasing research, how it will profit the organization and the basic needs to adopt the purchasing research for the profitability of an organization. Purchasing research helps to gather useful information about the product which is to be purchase and ensure the quality and quantity at the right place. It is also used to make useful suggestions and recommendation that will help in purchasing materials for the organization.
According to Uzor (2003) purchasing research is defined as the systematic collection, classification and analysis of data as the basis for better purchasing decision. It is therefore a formalized means of obtaining information to be used in making decision.
Comprises the essential activities associated with the acquisition of the material, service and equipment used in the operation of an organization.
Research affects everything in human activities the companies are not left our, in materials sources of supply to be precise and other vital and related issues on purchasing hence purchasing research. It has been noticed that the first world countries that have adopted research have made unusual and exceptionally and progress in the technological advancement of the world. This study advice the third world countries and especially universities and polytechnics, research institutions not to overlook the importance of research.
Companies are also advised to pay attention to the contribution of purchasing research for their enhanced profitability. They should also know that purchasing research is a tool that can help them in making their daily decisions. Due to the fact that purchasing research helps to increase purchasing activities, companies against this background, are expected to accept purchasing research and provide the fund required to carryout this research for the best performance of the purchasing function which contributed to the organizational overall profitability.
1.1.1 BRIEF HISTORY OF THE NIGERIA BOTTLING COMPANY PLC OWERRI
The Nigeria Bottling Company Plc Owerri is an authorized producers of coca-cola, fanta, fanta lemon, fanta orange, krest tonic, spirite, etc drinks.
It was incorporated in Nigeria in 1951 that about 60 years today, coca-cola, its main and popular product was first bottled and sold as a drink at a soda foundation in Atlanta in the United State of America (USA) in the year 1880. The company and its products have since grown from strength to strength and coca-cola is now produced and sold in about 150 (one hundred and fifty) countries all over the world, while there are over one thousand (1000) bottles of which Nigeria Bottling Company (NBC) is one of them.
The Nigeria Bottling Company Plc is grouped; it has about fifteen (15) plants and over one thousand (1000) mini depot all over Nigeria of which Owerri plant is one of them. Its Nigerian headquarters is situated in Ikeja, Lagos State. The company has the crown corks for all drinks and Delta glass industry at Ugheli for its bottle manufacturing.
The Owerri plant started operations in addition to the training carried out at the branch for staff generally by coca-cola Africa and the Leventis Group Training Centre. The Nigeria Bottling Company runs training schools also at Ikeja for various categories for the distributors of its product. Moreover, special training is regularly organized from time to time for the sales department, production, warehouse department and quality controllers.
1.2 STATEMENT OF THE PROBLEM
The high inflationary trends records in Nigeria in recent time are never a thing of joy to companies coupled with the critical raw materials shortages, component parts etc.
In some organization purchasing and supply department lacks competent trained professional staff that can effectively carryout the task of purchasing research that is required in most organization with a view to increase profit, knowing that any wise overall purchasing contributes to profitability like in many other continuous staff training has been immense importance for growth of effective purchasing research as a dynamic area of management discipline requires well informed professional that can keep abreast with the changing business environment in order to achieve success for the organization.
The problem of this research is to analyze the various area of purchasing research towards profit and growth of an organization.
1.3 OBJECTIVE OF THE STUDY
The objective of the study is to prove that purchasing research contributes towards profit and growth of an organization purchasing and supply management as a specialized discipline is meant to satisfy the material needs of an organization and it should not be seen as all comers affairs where anybody can come and do anything the way we want it.
It is against this backdrop that effort should be made to ensure that there is no encouragement of other professions into the purchasing research activities. This is because purchasing research has aim and objectives to be achieved and should not be seen as a goldmine where individual with little or no knowledge of the principle should encroach for self ends.
From the foregoing, the objectives of the study are:
1. To understand how Nigeria Bottling Company Plc depot see purchasing research in all its ramification.
2. Find out how purchasing research contributes to organizational profitability.
3. To highlight any shortcoming that may be hinged through ignorance and other device.
4. To ascertain the important areas of purchasing research.
5. To review the way profitability is being measured in Nigeria Bottling Company Plc.
1.4 Research Questions
1. Is purchasing research contribution to the profit of the organization?
2. Is purchasing research recognized in the organization?
3. Does the organization attach importance to purchasing research?
4. Is the purchasing manager professionally qualified in such area or he/she just qualified through job experience?
1.5 THE SIGNIFICANCE OF THE STUDY
This research work is very essential to a number of persons to the researcher this research is an adventure. In the process of writing this, it is a way of increasing my talent and creative gift of writing as a student. Furthermore it is a requirement for the award of National Diploma (ND) in Purchasing and Supply Management.
In addition, this will serve as a data base for reference point for other researchers. Moreso, the purchasing department in every industry will recognize the central of this research work as it helps. There is fixed personnel, suppliers on commodities and on purchasing procedures.
1.6 THE SCOPE OF THE STUDY
Purchasing research is an essential and large area of study, it is carried out by a lot of manufacturing industries in order to increase their profitability. This being the case, this research is on purchased materials products or service purchasing personnel, suppliers, commodities, and method purchase, that is purchasing procedure.
1.7 LIMITATION OF STUDY
A lot of things interest me in carrying out this research work, things like the joy of ending my National Diploma with writing of your project. Because of this, I was constrained with time because we are given a short period to write our project after exams. I was therefore hurried to meet up with the date given to use and there was also no time to visit other libraries for more information.
1.8 DEFINITION OF TERMS
It is important to find the meaning of unfamiliar terms so that other researchers may find it easier to case they want to make use of this work.
1. Research: This is sustained inquiry into problem and seeking out way to solve it. According to Anyanwu (2006) research is the systematic and objective search for an analysis of data with a view to generate information necessary for the solution to the problem.
2. Suppliers: These are the people who supply materials, parts, goods or services to the buying organization.
3. Purchasing research: According to Uzor (2003) purchasing research is defined as the systematic collection, classification and analysis of data as the basis for better purchasing decision. It is therefore a formalized means of obtaining information to be used in making decision.
4. Organization: This is a firm that may be either profit or non-profit oriented that exists for the sake of producing goods and services or rendering services at a profit.
5. Profitability: This is the target of over profit oriented firm increasing their capital based in the form of additional revenue which can be plough back into the business.
6. Manpower: This is the number of people working or available for work.
7. Purchasing: This is process of buying, learning of the needs, locating, evaluating and selecting a supplier, negotiating price and following pertinent terms, placing order and following up to ensure delivery at the agreed delivery date.
8. Purchasing function: This comprises the essential activities associated with the acquisition of the material, services and equipment used in the operation of any organization.
9. Purchasing procedure: This is a mechanism by which a purchasing transaction is carried through from its inception to its conclusion.
10. Efficiency: This is a process of achieving the intending result without any waste of effort.
11. Supply chain management: This is the management of all activities, information, knowledge and transformation of goods and services up from the raw materials suppliers, components supplier and other suppliers in such a way that the expectations of the end users of the company are bring met or surpassed.
12. Management: This is planning or operation, securing of the maximum efforts from those who are employed by the organization and the coordination of the activities of man and machine.
13. Production material: These are those materials which go directly in the finish product.
14. Manufacture: This is process of converting raw materials into finished goods.
15. Strategy: This is the basic plan of action chosen to achieve an objective, which is the overall plan than is decided upon to reach the objectives that have been set.
16. Purchasing and supply chain management: This is a process the represents a system in which an organization define and use their needs for goods and services.
Impact Of Purchasing Research On The Purchasing Function:
Purchasing research plays a critical role in the purchasing function of an organization. It has a significant impact on various aspects of the purchasing process and can lead to improved efficiency, cost savings, and strategic decision-making. Here are some key ways in which purchasing research influences the purchasing function:
Supplier Selection and Evaluation:
Purchasing research helps in identifying and evaluating potential suppliers. It allows purchasing professionals to gather information about suppliers’ capabilities, reliability, quality, and pricing.
It enables the purchasing function to make informed decisions when selecting suppliers, ensuring that the chosen suppliers align with the organization’s strategic goals and requirements.
Cost Reduction:
Researching market conditions, pricing trends, and cost structures enables organizations to negotiate better deals with suppliers. It helps in achieving cost savings and improving the overall profitability of the organization.
By analyzing historical data and market benchmarks, purchasing professionals can identify opportunities for cost reduction and cost containment strategies.
Risk Management:
Purchasing research helps in assessing and mitigating risks associated with the supply chain. It allows organizations to identify potential risks such as supply disruptions, supplier financial stability, geopolitical factors, and compliance issues.
With the insights gained from research, the purchasing function can develop risk management strategies to minimize the impact of disruptions and ensure a more resilient supply chain.
Market Intelligence:
Research provides valuable market intelligence, helping organizations stay informed about industry trends, technological advancements, and emerging market players.
This information allows the purchasing function to make strategic decisions regarding product sourcing, supplier relationships, and product development.
Product and Supplier Innovation:
Purchasing research can uncover innovative products, materials, or suppliers that can give the organization a competitive advantage.
It enables the purchasing function to collaborate with suppliers on product and process innovation, fostering long-term partnerships and improved product offerings.
Compliance and Sustainability:
Researching regulatory requirements, ethical sourcing practices, and sustainability initiatives helps organizations ensure compliance with laws and industry standards.
It supports the integration of sustainable and responsible sourcing practices into the purchasing function, aligning with environmental and social responsibility goals.
Negotiation and Contract Management:
Research provides data and insights that strengthen the organization’s position during supplier negotiations and contract management.
It helps in setting realistic expectations, benchmarking contract terms, and ensuring that contractual agreements are fair and beneficial.
In conclusion, purchasing research is a vital component of the purchasing function, contributing to informed decision-making, cost savings, risk management, and strategic alignment with the organization’s goals. It empowers purchasing professionals to navigate complex supply chain landscapes and drive value for the organization.