1.1 BACKGROUND OF THE STUDY
Material management is an integrated management approach to the
planning, purchasing, warehousing, storekeeping, allocation and movement
of needed material from source of user department. It can also be
defined as the process of management of goods and materials which
involved purchasing, storage, control and transportation.
Material and resource management is a relatively new discipline. The
20th century rapid growth and the attendant industrial growth and the
attendant shift of production is relative importance of what is usually
referred to as the five “m” which includes machine, materials, men money
The famous industrial revolution about the complexity of materials
and the volume of productivity which turn and made materials the largest
elements cost in every organization.
At the wake of the 20th century many firms had recognized the
importance of materials, several materials activities like purchasing,
warehousing, stock control and distribution carried out by the
By the 1950s many firms have identified the need for an effective
coordination or integration of such material activities and materials
organization tools concepts like those of physical distribution
movement, logistics movement and material management were involved so as
to check, co-ordination and control of the firm’s materials activities.
Globally, there is no clear definition because many institutes and
writers have given so many definitions in the area for material
According to M.A. Tokunbo (1987) define it in the context of store
and material control as compensation, the effective coordination of the
- Identifying, classifying and coordination of stocks.
- Provision, inventory, control and stress accounting.
- Store-house layout and organization
- In house storage, handing and distribution
- Presentation of material in store.
To these, the material manager has the duty of applying the most
suitable techniques in the most effective way to ensure the minimum
total costs consistent with providing the services required.
The American production and inventory control society (APICS
dictionary of production and inventory control terms) define material
management and resource utilization as the grouping of management
functions related to the complete cycle of materials flow from the
purchase and internal control of work in progress of the product,
differed from material control in the latter term, traditionally is
limited to internal control of production materials. The key words here
are material production or manufacturing process.
In examining the whole definition one could easily notice that they
are not quite different from one another, but only the way of approach
and little different in terminologies. In this respect material and
resource utilization management is not only limited to buy and storing
as many view it but also include purchasing, transport and distribution,
planning and continuous monitoring.
Today materials and resources utilization are the livelihood of any
industry, no industry concern can operate without them. They must be
made available at the right time. In the right quantity and at the right
The subject matter of this study is material management and resource
utilization in an organization. The researcher feels it will be of a
great important to various enterprise and organization to conduct a
detailed study into stores and purchasing material hence, the researcher
aim at identifying the problem for efficient operation in an
The researcher is interested in knowing how material management and
resource utilization function act practicable in an organization. As a
result of the sophistication in technology at parent coupled with social
economic and political changes. Activities could no longer be run
without problem and adhoc basis but must be planned moreover when
problems are complex in nature by management there is a need to ensure
that materials and resources are allocated and used in the most
efficient and effective way.
The material management and resource utilization function is also to
identify problems by guiding against sub-optimization of the material
and resources (under utilization of organizational resources) for this
the researcher assist to and acceptable.
Seven-up brand roots go back to 1i920 when C.L. Gregg banked on his
30 years of experience in advertising and merchandising to form the
howdy corporation in St. Louis, although he named the company after the
Howdy Orange drink he pioneer, goal was to create a wholesome and
distinctive soft drink that would prove irresistible to the nation’s
Gregg spent more than two years testing different formulas of lemon
flavored drinks. He settled on one that fulfilled the characteristics
sought refreshing, and thirst – quenching. Gregg introduced his new soft
drink two weeks before the stock market crash in October 1929.
The earliest Seven-up advertising featured a winged 7up logo and
described the soft drink in bottles only seven natural flavors blended
into a savory, flavor drink with real wallop Acknowledgement the success
for the seven-up trademark bottling company plc was founded in 1959s,
seven-up has become the third best selling soft drink in the world.
While in Nigeria, seven-up bottling company plc was founded in 1959
by late Sheikh Mohammed El-Khalil, at Ijora Lagos. Production started on
October 1st 1960.
The company brands include Seven-Up, Pepsi, Mirinda (orange, soda
tonic, pineapple, green apple) mountain dew and teen lemonade.
The organization had nine operational plants branches across Nigeria
which are as follow: Ikeja plant, Ibadan plant, Benin Plant, Ilorin
Plant, Enugu Plant, Aba plant, Abuja plant, Kaduna plant, and Kano
The head office of Seven-Up Bottling Company Plc is at Ijora Apape area in Lagos State.
Kaduna Plant which is the plant been used for the case study is
situated at Kaduna South, industrial area along Inuwa Abdulkadir road.
The company is committed to a culture of excellence in all their
activities. Hence they strive to position the company to meet and exceed
the expectation of the employees, customers, suppliers, shareholders,
government and its agencies including the general public.
1.2 STATEMENT OF THE PROBLEMS
Seven-Up Bottling Company Plc as an organization is faced with
problems in relation to utilization of material and resources being the
utmost thing that are needed to be utilized effectively. The problems
facing the material management and resource utilization especially
Seven-Up Bottling Company Plc are mainly overstocking or under stocking
of materials, obsolescence’s breakage and the economic order. Due to the
fact that functions of many purpose, the impact felt positively in the
society by making themselves reasonable in every area of inputs.
But despite the material management and resources utilization as a
tool for optimal utilization in Nigeria is not notice because it was
observed that it is a general apathy" ignorance and lack interest by
many people in the country. Many of the people including the government,
individual are having the wrong nation and wrong impression.
1.3 OBJECTIVES OF THE STUDY
The major objectives of the studies are as follows:-
1. To find whether the company use accounting tools and techniques
in maintaining their materials.
2. To find how Seven -Up Bottling Company Plc managed their
3. To find out how resources are been utilized
4. To find out whether there is wastage of material or not
5. To look at the significance of materials management and utilization
of resources in manufacturing.
1.4 STATEMENT OF HYPOTHESIS
Ho Material Management and Resource Utilization cannot improve productivity in an organization.
HI Material Management and Resource Utilization can improve productivity in an Organization
1.5 SIGNIFICANCE OF THE STUDY
The significance of the project is designed to help business,
institutions or an organization to analyses and reduce excessive cost in
all areas of it operations. In today's business climate, with keener
Unstable economic condition, the sustained controlling of cost often
means the different between profit and loss all over the world, cost
conscious executives, purchasing managers in institution etc.
More so it is of a great significance to the manufacturing
industries, that is, the project is of great importance because it is
possible to evaluate the efficiency of material management and resources
Material management and resources utilization is compendium concept
of the best cost controlling ideas and methods that have evolved in
recent year. Material manger, purchasing department will find these
project useful ideas that can be directly applied to reduce costs within
Thus, the project may be of immense help to all business, institution
and to those organizations that are faced with the problem of material
management and resources utilization been the utmost resources that are
needed to be utilized effectively.
1.6 SCOPE OF THE STUDY
The scope of this study has to do with the importance of materials
management and resources utilization in Seven-Up Bottling Company Plc as
a case study.
1.7 LIMITAIONS OF THE STUDY
This research work is limited to the following department found in Seven-Up Bottling Company Plc.
Personnel Department: This department is
responsible for recruitment of skilled, semi skilled and
unskilled personal for the entire various department in the
organization: It's also look into the general welfare of the workers
and the overall organization operation.
Production department, they are responsible for preparation f
schedule for production when to start the production for a particular
product (flavor) and also determine the expected quantity material
utilization and also a management of jobs.
Accounting Department, this department is responsible for the
settlement, of invoices release, casting of material for the purpose of
final account or determination of production cost.
Quality control department, this department is responsible for making
sure that goods (products) and service are examined to conform to
predetermined standard, these department comprises of section such as
water treatment, syrup room and laboratory.
Store department, the department has to or renders. Some function to the organization, which area:-
i. To make provision for a balance flow of raw materials that is necessary to meet operational requirement.
ii To make available the maintenance of materials, spare part as
well as general store requirement of materials, spare part as well as
general store requirement.
Warehouse, warehouse is the department responsible for receiving
finished goods from the production department and them forward the some
finished product (goods )to marketing department, marketing department
are mainly responsible for sales, that is selling the company products
at the company recommended price to the various customers.
Feet/ workshop, they are responsible for the transportation, services
and repairs for the various company vehicles especially the sales
trucks and other vehicles.
In writing a project research works, one is bound to face some
certain constraints that will limit the extent to which the research may
intend to cover such as:
i. Time: Time is the most affecting constraints to this project in fact, have enough time to write his project work.
ii. Financial Constraints: This is another
constraint which hinders the researcher from carrying out his research
work on time, especially the recent federal government economic
programme which made it difficult for the researcher to source for funds
on time; it has slowed down the progress of the project.
1.8 DEFINITION OF TERMS
i. MAINTENANCE: It is the scientific utilization of
Resource which includes material, machine, men, method and money to
accomplish task, its embrace planning, organization directing, and
ii. MATERIAL MANAGEMENT: It is concerned with the
flow of materials to manufacturing department; it can be described as a
coordinating Function responsible for planning and controlling of
materials flow. Material management is an aspect of grouping together
under some of finished products; some of these activities may include:
purchasing, Inventory control, expenditure warehousing and receiving
iii. PLANNING: Koontz O. Donnell and Welf Rich
(1989) Perceive planning as deciding in advance what to do, how
to do it when to do it. Planning bridges the gap for where we
are to where we want to go. A plan established objective can be
attained considering various aspects of the environment and
determines the amount of resources necessary.
iv. RESOURCES:- Resources are divided into
human and material resources, the human resources is the man power
that controls the activities of the organization while the material
resources are the assets or wealth of the organization that is
put into use in achieving the organization aim.
v. ORGANISATION: This is a systematic ordering
of position which determines chains of command or it is an
organized group of people working together towards a common ideal
and aspiration of the group and putting effect together towards
achieving an objective.
vi. OBJECTIVES:-These are the specific
productivity on organization wants to achieve in other words it
could be seen as asset aside goals in which an
organization work towards to achieve effectively and efficiently.
No organizations come into existence without having an
objective to achieve.
vii. UTILIZATION:- To make the best use of resources efficiently.
viii. PURCHASING:-Purchasing is a strategic activity
in an organization with primary objective of improving and
maximizing profit it figure out new ideas for improving company's
products, search for belter source supply funds, substitute materials
that are more economical.
ix. PURCHASING ORDER FORM: This is legal document
normally printed to transmit the organization requirement to the
suppliers. This form varies from organization to organization in size,
shape and layout. Content and number of copies, however certain
essential elements are common.
x. PURCHASING REQUISITION FORM:- This form is
usually prepared when a department or store needs a particular
materials. Normally three copies are prepared, two copies being sent to
the purchasing department as on authority of purchasing and the
duplicate being retained by the originating department for reference and
xi. ENQUIRY AND QUOTATION: - When competitive tender
are required. It is customary to send an enquiring to
the suppliers and to receive quotation from the
suppliers in order to select the most suitable by analysis of the
tenders that are been received.
xii. NEGOTIATION:- It is a decision
making process, that is it is a process of planning, reviewing
and analyzing by buyer and a seller to reach acceptable agreement or
compromise through common understanding.