Factors Affecting Inventory Management Practice (case of Bedele Brewery Factory, BunoBedele, Ethiopia)

Abstract

This study conducted to assess factors affecting inventory management practice, in case of Bedele Brewery Factory. A lot of resources have been devoted into research in the inventory management practices of organizations. It represents one of the most important assets that most businesses possess. In the manufacturing companies, nearly 60% to 70% of the total funds employed are tied up in current assets, of which inventory is the most significant component. The brewery sector is a growing sector which is gaining its importance in recent past. Not much amount of work has been done on this area of managing inventories in brewery sector. The objective of the study was to find out the factors those affect inventory management practice in Bedelle brewery factory. The study had its own significance for brewery factories. The study was carried out through descriptive survey design and data was collected through questionnaires. The study was used census/total enumeration method since the study population limited in number, 134, so no need of sampling. Descriptive and inferential statistical tools: mean, percentage, frequency, correlation and multiple regressions were used to analyze collected data. Multiple linear regression analysis was used to show the relationship between the dependent variable (inventory management practice) and the independent variables (staff competency, bureaucratic procurement practice, budget & documentation/stock record) and recommendation was provided based on the findings of the study. Thus, this study find out that all the independent variables (staff competency, bureaucratic procurement practice,budget and documentation) had a positive significant interference with inventory management practices of the brewery (with p<0.05, and positive regression coefficients). Therefore, the brewery should have to pay a great concern for the indicated inventory management functions in order to maintain and improve the inventory management practices of the brewery.