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 SIO AGRO and ALLIED INDUSTRIES LIMITED is a processing industry involved in agricultural and similar products processing. The industry went into production in 1980 with fire board members. It is situated in the North East of Asaba Delta State. It has a total staff of 120 as at the end of july 1994.

SIO AGRO and ALLIED INDUSTRIES LIMITED commenced business with total capital of SIO AGRO and ALLIED INDUSTRIES has risen to N150, million in cash and assets. In purshance of its social responsibility SIO AGRO and allied industries as at the end of july 1996 has a total staff of 200. This large number of employees is necessary following the diversification of its products.

The management of the company is unbureautically.

This flexibility in management style give the organization a great deal of specialization.

 In this method, Certain amount of rigidity is discourage, this stem creates room for dynamic of employees and lower cost of control and management.

 Furthermore, the organization adopts democratic approach to leadership. This approach allows the subordinates to participate in the decision making exercise. It also make decision making  exercise. It also make decision flexible and a motivation to the subordinates. Moreso, the organization is structured according to functions performed by the organization were assigned responsibility and authority.

The products of SIO and ALLIED INDUSTRIES are highly diversified to include agricultural products and industrial goods.

Finally, SIO AGRO and ALLIED INDUSTRIES has continued to grow from bound to boased. It recorded a net income of N1.3 million in 1996 and has the prospect of increasing its sales and profit in the nearest future.


Stock are  the grave yard of a business. It then follows that any firm that toils with its material management is doomed to have a financial crisis which will ultimately end the business in its grave. Therefore, the need to have proper inventory management in a manufacturing enterprise cannot be over emphasized. Regrettably, most manufacturing organization have neglected this, thereby resulting in poor performance of such problems as high wastage of materials, production of spoilt or low quality goods, inventory needs to be controlled from the point of purchase until it gets to the final consumers.

It is a common knowledge that inadequate management and control of inventory in an organization will lead to pilferage by workers, at times, these may not be noticed and it will mislead the management in fixing the process of it’s products, because the needed information for correct price fixing is lacking.

In all these will result in huge revenue losses to the firm. This project in inventory management and control with reference to S. I. O. AGRO and ALLIED INDUSTRIES (SIO INDUSTRIES) attempts to compare the theoretical frame – work of inventory management, with the inventory management in SIO industries. The company has problem with regard to stocks requisition and pilferages. Therefore, it wishes to find out whether SIO industries Asaba adopts proper inventory management and control and to what degree has the system affected full solution capable of correcting the right situation have been recommended.

 1.3               SCOPE AND LIMITATION

During the research, the curse of the work encountered some imminent problem. The problem of time stood in the way of the research. The time for the work was very short to have a thorough study and analysis of the study.

As a result, it became difficult for the work to pay regular visits to the organization at least to afford her the opportunity of observing from time to time the methods of inventory valuation and perhaps the customer of the organization could be approached to give data necessary for the study.

This study is restricted to the inventory management and control in SIO industries Asaba and does not cover all manufacturing firms.

Storage of semi finished goods and supplies were all covered in this study since they all make up the inventory of the firm.


The size of every manufacturing firm such as SIO industries is to have the right quality and quality of materials at the cheapest cost always.

It is only through effective and efficient machinery to achieve this objective. Inventory should be controlled by ensuring that they pass through several department of the company such as accounts production, finance, Marketing and Supply.

The overall objective of all these measures will be to ensure the profitability of the business.

These are the objectives:

  1. To find out whether inventory management measures exist in SIO industries Asaba.
  2. To recommend on how management can solve problems of inventory management.
  3. To identify organizations various problems encountered while apply the inventory management policies.
  4. To findout whether inventory management measures actually exist in SIO Industries.
  5. To examine and asses the various methods of inventory management in the organization.

Inventory which has been regarded as the nerve center of any manufacturing industries often constitute the largest single asset of each form.

 Some cost are incurred for holding the inventory such as cost which is seen theoretically and practically include purchase cost, cost of insurance taxes and interests. The writer, having viewed the huge cost involved, deems it inevitable to study the effective and efficient inventory control measures of manufacturing firms. So many firms such as SIO Agro and ALLIED INDUSTRIES LIMITED ASABA will through such work achieve her organizational goals.

 1.5                DEFINITION OF TERMS

  1. INVENTORY MANAGEMENT: This can be defined as the planning, cordinating and controlling activities related to the flow of inventory into, through, and from the organization.

      Stocks by themselves do not yield income unless they are used in production and afterwards the products sold. Hence it would be in the interest of an organization to have too much stock. On the other hand, an organizations activity will be disrupted if they don’t have enough stock.

An organization should always aim at an equilibrium position in stock management.

This position will be maintained when sufficient stock is maintained at minimal costs to the organization.


     The periodic level system on the other hand involves the use of mathematics in

      setting standard quantities to be ordered at times of ordering.

This system produces warning signals that give guidance on when and how much to order at specific times.


The periodic review system on the other hand involves establishing a fixed quantity to be ordered at specific time intervals. To avoid overstocking, trend analysis is utilized in detecting the quantity and to order stocks.


The importance of hypothesis in any research work as this cannot be overemphasized. It is carried out on the basis of the hypothesis the researcher has formulated. Based on the problems being investigated.

Answering from the stated objective of the study, the researcher hypothesized thus:

HO: Null hypothesis – The inventories are well managed and this has resulted to highly profit in SIO Agro and Allied Industries Limited Asaba.

HI: Alternative hypothesis – The inventories are not well managed and this has resulted to low profit in SIO Agro and Allied Industries Limited.

HO: Null Hypothesis – Introduction of efficient inventory Management and control system aid sales in SIO Agro and Allied Industries Limited.

HI: Alternative Hypothesis – Efficient inventory Management and control System will not aid sales in SIO Agro and Allied Industries Limited Asaba.

HO: Problems of stock out production break, loss of sales, excess stock holding occur in SIO Agro and Allied Industries because of absence of inventory Management and control.

HI: Problems of stock outs, production break, loss of sales, excess stock holding in SIO Agro and Allied Industries are not attributed to the absence of inventory Management and control.


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