Stock Management In The Hotel Industry

INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The most significance and most valuable assets of any existing enterprise are inventory management because for an enterprise to be able to give accurate measurement and good description of her asset, inventory becomes the first to mention. This is of course, is so because the sale of inventory at a price is greater than total cost indicates an efficient merchandising, which is however is the primary source income generation.
These inventories are both assets and items held in the ordinary course of business or goods that will be consumed or used in the production of goods to be sold.
Geoffrey Merdith[1982] defined stock management as inventory operations as the combination of systems and processes involved with inventory management as well as the physical aspects of storage and material handling. The direction and control of activities with the purpose of getting the risk inventory in the right place, at the right cost. Effective stock management and security are imperative and must cover the whole supply chain through to the final distribution to customers .
From the clear point of view, inventories in management constitute and important asset. However , stock management is an area of accounting and financial data of goods being sold. The stock management is an area of accounting and financial data of goods being sold. The stock management system should ensure that initial low quantity of goods can be put best use.

Graham Buxton[1979] looked at stock management as the ability of a firm to ensure that stocks of a company’s products are made available on a consistent basis in the light of the company’s service policy to its market demand. Stock management is extremely important. The investment of inventories, the largest current assets in manufacturing and retail establishments and may also be a material portion of the company’s total assets. So if unstable items have accumulated in the inventory, a potential loss exist and product ordered by potential customers are not available in the desired system, style, quantity, quality, sales is an inefficient purchasing procedure, faculty manufacturing techniques, inadequate sales efforts will thus all result in excessive and unstable inventories During prosperity when sales are high in many business, merchandise can be given off readily and quantities on the other hand may not appear excessive. But when there is a slight downward inventories in the business cycle, many live merchandise move slowly, then stocks accumulate and bring about obsolescence. To achieve this, if not stopped completely, management should put much efforts and interest in inventory planning and control.
Duck-larkan emphasis on stock control so as the right materials are available at the right time, with the minimum of storage and investment. It is necessary to monitor those forecasts into action. A system must be installed to record stock levels, sanction the issue of stock and purchase replacement. The master document is the stock control card which continuously gives a record of the stock position for the item concerned including numbers outstanding or orders placed. A classification and codification is necessary both from the stock control and the stores affect.
In conclusion however, it is necessary to properly investigate and examine the real nature of stock management in the existing hotel and catering industries rank equally and favorably with their counterparts in the developed nations. Companies must keep accurate records for items in inventories and installed at customer sites knowing who has checked out, which equipment each morning and which asset is returned every evening is a critically inventory management.

1.2 STATEMENT OF PROBLEM.
The following are the problems of this research.
Most hotels are faced with lack of fund to carry out enough stock control in order to minimize and to be able to fulfill their customers needs.
Stocks can costs a lots of money in tied up capital, storage costs and
deterioration
Lack of warehouse – Most firms are faced with the problem of warehousing. Some hotels don’t have sufficient warehouse for storing their goods.
Poor store keeper- The hotel lack an experienced store keeper who knows how to calculate, when and to order for inventory replenishment in order to minimize costs under a given service policy. How does he know when to reorder the various lines of goods.

1.3 PURPOSE OF THE STUDY.
Having stated the problem, this work tends to achieve the following:
1. To determine the importance of stock management as one of key factors for safe guarding goods.
2. To determine the best method to use for minimizing lost in the warehouse in order to avoid run out stock.
3. To suggest ways of training and development of all staff concerned with stock in order to ensure proper checking or store taking in the store.
4. To determine the extent that stock management in the hotel industry can be built.

1.4 SIGNIFICANCE OF THE STUDY.
The study on its completion will help the management of Royal Palace Hotel on how to improve the system of receiving and issuing of materials in the store department of not only public as the case may be but as well as private owned enterprises.
It will also reveals areas of problems in actual practice and thereby giving researches materials to combat these problems he or she may likely face as an aspiring young managers of a private or public owned enterprises.
Stock management will assist the management on how to organize training and development of staff that are concerned with stock. It will assist organization how to effectively co-ordinate proper material forecasting, planning and effective control of stocks.
Finally, it will attempt to enlighten the entire staff of Royal Palace Hotel on the stock procedure.

1.5 RESEARCH QUESTIONS.
For the purpose of this study, the following questions were asked.
1. What impact does stock management has in the development of small
Business?
2. How can a sound tack stock management be built in a hotel industry?
3. Does the company operates on predetermine for item on stock whether minimum, maximum recorder and economics order quantity?
4. What method of material issuance from the store does the hotel adopt?
5. Does the store keeper always ensure proper checking or stock taking in the store or he do both together?
6. Why do the hotel hold stock?
7. What do you think is the need for stock management?

1.6 SCOPE OF THE STUDY
The scope of this study is very wide. It is to cover stock management in the hotel industry. This will entail a variety of research study but due to some avoidable factors, it will not cover the whole of Nigeria. But it is believed that what method used in the management of stock anywhere in Nigeria is also applicable in other countries.
Thus, as a result of insufficient materials to be used in carrying out this research. The study shall be limited to “ROYAL PALACE HOTEL ENUGU.”
1.7 LIMITATIONS
1. FINANCE: The financial strength of this researcher is a major setback
As it made things a little bit difficult. Most especially in the area of Transportation for search of materials.
2. TIME CONSTRIANT – Due to time factor, coupled with academic Work and as well as other pressing engagements, the researcher was
Not able to carry out a depth research on the topic.
3. LACK OF MATERIALS- The major limitations which the researcher encountered in the non-availability of enough materials that cover the Subject under review.
4. ATTITUDE OF THE WORKERS: The research topic is a very sensitive ore, made the company’s workers and managers of competitive advantage. The work was therefore on the limited information and data made available to the researcher.

1.8 DEFINITION OF TERMS
There is need to give an operational definition of some important terms used on the research work. They include:
1. STOCK/INVENTIONS: They are materials kept in a store.
2. STOCK TAKING: This is physical or manual counting of items in the Store.
3. INVENTORY CATALOGUE: It is a store document describing each Individual item of stock and the part it will form in the products.
4. CODING: Is the identification of items by assigning specific numbers of figures to it.
5. STORES REQUISITION: It is a store document for getting goods or items from the store.
6. SUPPPLIER/VENDOR: He is a person who makes goods or items available to others.
7. STOCK CONTROL: Is a set of politics and procedures by which an organization determines which items it holds in stock and how many of items it carries.
8. ABC ANALYSIS: It is a stock control device that analysis the naira value of all items in the stock.
9. MINIMIUM STOCK[BUFFER]: A precautionary stock level which takes care of unexpected delays in delivery.