Inventory Management and Organizational Performance

ABSTRACT

This study investigated inventory management and organizational performance, while the specific objectives were to examine the effect of inventory turnover, inactive stocks, stockouts and lost sales on organizational performance in Drugfield Pharmaceuticals Ltd, Ota, Ogun State, Nigeria. It was an ex post facto type of research. The main research instrument employed in this study was the questionnaire. One hundred and four (104) of the one hundred and twelve (112) questionnaires the researcher gave respondents were later collected in order to display and analyze their answers to the questions asked. The data collected were analyzed using descriptive statistics, correlation analysis, and the ordinary least square regression analysis. The analysis's findings included, among other things: a positive significant connection between inventory turnover and organizational performance; a negative connection between inactive stocks; lost sales; and stock-outs (but insignificant) and organizational performance. The study made several recommendations, including that businesses should implement effective inventory turnover if they want to compete and improve organizational performance. Also top management should make sure that stocks are not kept idle for an extended period of time to prevent theft and damage, which will negatively affect the organization's financial performance. Stock-outs should also be avoided. Finally, lost sales should be properly avoided with the help of virtues like accountability and transparency.