Inventory Management and Financial Performance of Listed Manufacturing Firms in Nigeria

Abstract

This study examined the impact of inventory management on the financial performance of Nigerian listed manufacturing companies. The study collected data using a combination of primary and secondary methods. The population of the study is made up of listed manufacturing companies in Nigeria throughout a ten-year period from 2011 to 2020. For the administration of the structured questionnaire, the target group consisted of 200 employees from the finance and store divisions, while secondary data were acquired using the enumeration technique. By examining the structures of the questions in the questionnaire, content validity was employed to validate the study instrument. The study instrument passed the Cronbach Alpha reliability test with an overall score of 0.925, which is greater than the 0.70-0.80 requirement. A total of 170 questionnaires were retrieved, accounting for 85 percent of the total disseminated surveys. Secondary data were gathered from audited yearly reports and accounts during a ten-year period. Inferential statistics were used to examine the hypotheses. Inventory control has a considerable favorable effect on the financial performance of listed industrial enterprises in Nigeria. The study revealed that inventory control has a significant impact on the financial performance of quoted industrial companies in Nigeria. According to the report, managers should improve their strategic relationships with suppliers and provide adequate automated security for tracking inventory movements around the company.