Role of material coding and classification in store management

Thesis Overview

<p> </p><p><em><strong>1.1 BACKGROUND OF THE STUDY </strong></em>Nigeria bottling company (NBC) Plc, Nigeria largest bottler of non-alcoholic beverages was incorporated in November 1951, as a bottling subsidiary of the A.G leventia group, with the sole franchise to bottle and sell coca-cola products in Nigeria. The production of coca-cola began in 1953 at a bottling facility in the basement of maintained hotel. That same year, the first plant was commissioned at Malu Road in Apapa Lagos.In those days of the small beginnings, the production line consisted mainly of manual operations and the output of a dozen cases per day. However, by 1960, annual sales has exceeded one million case and presently, sales estimates are in excess of 140 million cases annually, over the years, NBC has grown form just one bottling plant to 14 plant, over 80 deports and numerous sales outlets nationwide.The Nigerian bottling exist in refresh the consumers, partner with the customers, reward their stakeholders, and enrich the lives of their local communities. They produce and sell unique brands which bring pleasure to millions of consumers around the world everyday. The basis proposition of their business is simple.In carrying out this function of Nigerian bottling company production, many materials are required. This bottling company, having recognized the need for proper care of these materials appointed store personnel and store manager, and also established a purchasing unit charged with the responsibilities of suppliers selection, ordering, progressing, acquisitioning and procuring these materials. The store manager (including his personnel was charged with the responsibilities of storing, inspecting and developing systems for effective identification coding and classification of the material in the store houses of their organization as their first responsibilities. The stores manager of bottling company in his efforts to meet up his first responsibility of effective identification and coding of materials has grouped all the materials required, purchased and produced. These are located in different store house at different parts of the organization, most of which are sited closer to the user points, and their stores are named accordingly, for instance, information technology store, production store, engineering stores. The basis objective is to develop an unambiguous classification and coding system that facilitates clear internal communication ideally. This system should be designed so that it can be used effectively by all the departments in the organization clearly. The purchasing and store department are critical areas where the system must provide consistent and unambiguous identification and coding of materials. If the stock items are given a scientific identification codes a complete catalogue can be assembled so that when a part is required it is possible to determine very quickly it if is in stock. The stock records themselves will then indicate the exact stores location. We recognized the British standard institute who has done a great deal of work in establishing standards for materials and product, and when a standard specification number is quoted both customer and supplier will know exactly what is being referred to. Even where it is not possible to develop a sophisticated coding system, or arranged in logical lines will e of great benefit to a business in avoiding errors in orderings, issuing and pricing, etc. The stores manager of Nigeria bottling company through his grouping of material has arranged these materials on logical line for easy identification thereby avoiding errors in locating, ordering, issuing etc of item of stock in the organization. The code appears on all document relating to the movement and the use of materials and are marked against appropriate lines and racks.With these recognition, the store manager recognized the need for the use of stores vocabulary or catalogue. Therefore, the success of any materials control, or management of materials highly depends on the system adopted for effective coding and classification of materials stored.</p><p><strong><em>1.2 STATEMENT OF THE STUDY </em></strong>Although materials coding and classification is considered a clues or yardstick for easy identification in Nigerian bottling company. The organization having chosen all of the above coding system has resulted to giving every item different code numbers. This leads to the increase in the volume of the store vocabulary. Nigeria bottling company is faced with the problem of inconsistency in classification of materials in the stores section. For instance, there is a section of spinning materials which is normally under the spinning store but recently it has been transferred to the administrative stores. There is also lack of a section who takes adequate care of the organization store vocabulary. The organization is also faced with the problem of inappropriate classification of materials.</p><p><strong><em>1.3 PURPOSE OF THE STUDY </em></strong>The research work aims at finding out the procedure or steps and methods used in coding and classification of materials in Nigerian bottling company.It is also the aim of the study to identify the limitations to materials coding and classification with a view of looking for solution to them for the benefit of the organization.The study will also enumerate the need for the use of effective and efficient coding system. And lastly, to offer useful suggestions to management towards the application of the various method and techniques of coding and classification of materials.</p><p><strong><em>1.4 THE SCOPE OF STUDY </em></strong>Materials coding and classification is a wide area of study, and the scope of this study will be restricted to the purchasing department of Nigerian bottling company, in this respect, emphasis will be placed on examining the present system of the coding and classification and also identification of items. A researcher will also cover a wide range of study on the assessment of the need of coding item in the private firm and other organization. The researcher finds it appropriate to study a very representative and well known firms and draw a generalization accordingly. This study will also be interesting in focusing attention on the existing problems relating to coding and classification of materials and also make commendation on possible means of eliminating the problem.</p><p><strong><em>1.5 SIGNIFICANCE OF THE STUDY </em></strong>The researcher believes that the project will succeed in throwing more light on the subject matter. It will also go a long way in picking that conscience of all who have or assumed responsibility or materials coding and classification of purchased materials in manufacturing industry with particular reference to Nigerian bottling company Plc. The significance of the study derives the usefulness in the following ways 1. It will help the researcher to appreciate the need of coding and classification of items in private organization. 2. To the company, it will highlight that a purchasing manager and other manager in different organization will benefit by knowing that some materials that are stored in the store or warehouse will be easy to be identified or located because of the coding and the classification system.3. it will provide employment opportunity for many people and also faster communication between the store manager and the workers.4. Finally, student or anybody that does not have an idea of the use of coding system, if comes across this project will also gain and have the knowledge as well. And also use this project as a research book.</p><p><strong><em>1.6 RESEARCH QUESTION</em></strong>In order to carryout a complete investigation on the subject matter, the researcher has come out with the following question; they are1. What advantages are attributable to as efficient coding system?2. What extent has coding simplified specification and standardization of materials in Nigerian bottling company? 3. What is the importance of stores vocabulary in the organization?4. How does the company classified and heat items not in the vocabulary. 5. what method of coding are being used in the organization?</p><p><strong><em>1.7 HYPOTHESIS</em></strong>Ho: Coding system does not help the organization toprepare specification of materials.H1: Coding system helps the organization to prepare specification of materials</p><p><strong><em>1.8 THE LIMITATIONS OF THE STUDY</em></strong>The writer tends to cover the needs for materials coding and classification in a manufacturing industry with particular reference in Nigeria bottling company In carrying out this research projects. The researcher was confronted with various limitationi. Financial Constraints: Due to the heard economic situation enough finacé that should have allowed most diversified research wasn’t available. b. Time constraints: The researcher combine her class work with research itself. This made the researcher to experience a very high schedule. As she had no transport of herself the problem became worse.c. Transportation: Transportation problem possed a big trait to the project. The researcher wasted much time for taxi, and may succeed only to get her point of call very late. d. Other factors that limited this study was that there is scarcity of stores management texts by Nigerian authors in this country. This made reference in previous works very difficult.</p><p><strong><em>1.9 DEFINITION OF TERMS</em></strong></p><p>Coding: Coding is a system of writing in which letters of numbers or a combination of both are used to reduce lengthy words into a small space.Stock –catalogue: It is a booklet containing the list and description of every item normally carried in inventory. Inventory: It is a detailed list, example of household goods furniture, etc. carried in store. Stock: store or goods available for sale, distribution or use, especially goods kept by a trader or shopkeeper, supply or equipment, stock or materials NIV: Not in Vocabulary: These are items that are not included in the organization coding system. Store vocabulary: This is a book or file that contains the code number of all the items held in stock and it full description.Suppliers code: This is where the stores employs the coding system of the suppliers of the gods.Black coding: This is the assignment of numbers of sequence by group of various sizes other than tens, hundred and thousands. A block can consists of any quality of number necessary to cover the item in a particular classification. Code symbol: This is the symbols used are either alphabetical (eg OPEC), numerical (e.g 05/06/1245) alpha-numerical (e.g Exc/p/043). Figure 1: Consumable spare-part stores and stationary store.</p> <br><p></p>