CHAPTER ONE
1.0 INTRODUCTION
Sourcing for
supplier is of paramount important to business organization. Therefore
selection of supplier or sources of supply should be handle with great care.
This is so
because wrong choice or bad supplier can ruin firm’s operations failure to
deliver or late delivery of materials by the suppliers can ruin firms operation.
Failure may lead to production stoppage or uneconomical urgent order both which
may have negative effects on manufacturing firms operations.
The importance of sources
selecting to business organizations has called for proper sourcing policy which
will assured material availability without materials there would be nothing to
convert to finished products at the same time it is desirable to reduce the
cost of the materials in order to optimize the use of working capital the major
objective of sourcing is to search who can best supply goods or service
required satisfactory it also stretches to cover the supplier’s
Development all attention
must focused on finding the best supplier. The best supplier is referred to as
those suppliers. Who can supply the material of the right quality and quantity
at the right price time and place?
Theses five
factors must be put into consideration, when selecting supplier coupled with
assurance of continual supply and better pre-post sales services should be the
target of a good buyer.
Evaluation of
supplier (to detect the extent to which they can satisfy the five right) can be
done by carrying out plant survey (plant visit) to inspect their facilities and
technical know how, investigation into their management competence likewise
their post performance in terms delivery and quality are all important
considerations to be made as to determine whether or not to buy from local or
foreign sources. Whether to use one source or two or more sources at a time
whether to develop a supplier or engage in a reciprocal trade any decision
reached must be in the overall benefits of the company putting into
consideration the benefits and the prevailing considerations.
It must be
noted that researching into market is necessary in order to have the fall
information on the material needed. This information can be obtain from trade
journals supplier catalogue, purchasing files, supplier information file, sales
personnel etc performance of the existing supplier must be evaluated to find
out whether the suppliers are performing satisfactory or not. The supplier is
performing satisfactory or not. The supplier is on the list buy yet to be
awarded contract too must be considered and the market situation reviewed.
The
unsatisfactory supplier is to be dropped and any opportunity provided by market
should be optimally used.
It must be noted that
sourcing is a major purchasing function and should be performed and carried out
by competent buyer with necessary skill in sourcing when carried out by a
procurement expert who act in accordance with purchasing code of conduct will
contribute tremendously to effective and efficient buying.
1.1 HISTORICAL BACKGROUND OF DOYIN INVESTMENT COMPANY, ILORIN.
Doyin
investment industry plc was located along Asa dam road in form capital Kwara
state. It was established in 1983 and was incorporated as first indigenous
company competing with western industries in the production of detergent. It
belongs to Doyin group of companies with prince (or) Samuel Adedoyin as
chairman and managing director.
Prince (Dr) Samuel
Adedoyin is a native of Agbamu in Irepodun local government Area of Kwara
state.
Doyin
investment industry plc started operation 10th December 1985 it
comprises of five factories which include soap and detergent plants source plants
suppurations plant and glycerin plant. The product of Doyin group of company
ltd through its subsidiaries engages in the business of soap and water,
toothpaste and medicament, paints farming property hospitability and agro
chemical in Nigeria.
It manufactures
pharmaceutical soaps detergent body creams juice and drinks the company also
provides beef cubes chicken cubes fish cubes creams detergent powder and blood
tonic.
Prince (Dr)
Samuel Adedoyin industrialist 76 June 4 Born in Ilorin Kwara state he is
chairman Doyin industries limited starve Motors limited Doyin manufacturing
company limited Adedoyin established a foundation for the handicapped and the
physically challenged children at the university of form the is a merged
children at the university of Ilorin He is a member Ikoyi club Lagos.
The company
has been able to achieve the following aims successful challenge and monopoly
of the western company detergent production won the awarded of quality from the
standard organization of Nigeria in (1988 to make herself widely known as
spread nationwide provide employment opportunities for Nigerians expand and add
to her product life.
1.2
STATEMENT OF THE PROBLEMS
Investigation
has revealed that many manufacturing organizations left sourcing activities in
the hand of non expert this might be due to total ignorance of the firm.
Some organizations
purchasing officers has little or no say at all in making sourcing decision.
This deprived the organization of the benefits best buy.
Many organizations do not
carry out sourcing in the way it ought to be carried out (i.e. failure to put
into consideration all necessary factors and this in most cases lead to
unproductive sourcing.
1.3 OBJECTIVES OF THE STUDY
The primary aim
of this research work is to satisfy one of the requirements for award of
National Diploma certificate in purchasing and supply awarded by purchasing and
supply department Institute of finance and management studies Kwara state
polytechnic Ilorin.
It is also
aimed at widing the scope of knowledge of the people on sourcing as in
manufacturing organization with the sound knowledge of sourcing the public will
be able to appreciate its significance in manufacturing firm.
1.4 SINGINFICANCE OF THE STUDY
This study is
significant because it will equip the researcher with the necessary practical
skills involved in the application of sourcing by manufacturing organizations.
This study is also
significant to the company under study in that it will enlighten the management
on the impacts of effective underlying the sourcing policy and in the
attainment of the organization’s corporate frees and objectives.
The study will be an
indispensable source of information to future researchers writing in a similar.
The study will broaden the
knowledge of the researcher in the subject matter
1.5 SCOPE OF THE
STUDY
The scope of
this study simply means the area of coverage of the study this project will
specifically focus on the impacts of effective sourcing on attainment of
organizational objectives. The study will be limited in scope to Doyin
investment Nigeria Limited Asa Dam Road Ilorin.
1.6 LIMITATIONS OF
THE STUDY
Limitation of
the study are three factors that have necessited the narrowing down or the
study to a specific area. Prominent among these factors were time constraint
this research could not be conducted on a comprehensive basis because of the
limited time allowed for the writing and submission of the project.
Secondly, financial constraint, this stands as a big
barrier as a lot of money was required to finance the research study.
Lastly, lack of cooperation from the case study the
responses of respondents (staff) were not encouraging in terms of releasing of
required information data they declined to release some vital information based
on the secrecy policy place in many organization.
1.7 DEFINITION OF
TERMS
1. Sourcing simply means
the selecting, identification, selecting of suitable sources or supply as
effect sourcing decision with respect to those suitable sources and
relationship both with preferred and potential supplier.
2. Effective: This can be defined as change produced by an action or
cause. The changes that lead to positive productivity.
3. Buying: This can be defined as acquisition of goods and services in
exchange for money or its equivalent.
4. Manufacturing:
The process of converting raw materials, componenets
or parts into finished goods that meet a customer’s expectation or
specifications.