INVENTORY MANAGEMENT PRACTICES OF ANBASSA CITY BUS SERVICE ENTERPRISE

Abstract

Public enterprises are organizations established and owned by government to provide different services to the public. Among these enterprises ACBSE is an Enterprise provide transport service to Addis Ababa and its surrounding residents. Different studies indicate that the Enterprise doesn’t provide quality service for its customers and they are not satisfied by its service. As per those studies, one of the reasons for this poor service provision is lack of spare parts to maintain its buses. The particular objectives that were analyzed include, assessing inventory management process and how it affects the service delivery of the Enterprise. The purpose of this study is to assess practice of inventory management in Anbassa City Bus Service Enterprise. The various factors influencing inventory management were broken into inventory carrying cost, inventory stock out cost, inventory stock record practices, stock audit practices, staff skill and experience, computerized inventory, and effective management of spare parts. The research adopted descriptive study design and purposive sampling technique. The researcher used a sample size of 47 employees from the target population to act as sample size. The research used questionnaire, interview with key informants, and observation of the researcher. The collected data were analyzed quantitatively and qualitatively. The key findings from the study revealed that: there is poor inventory management practice and utilization of spare parts which causes for stoppage of buses. According to the study, there are practices of over and out of stock, wrong, and obsolete spare parts that eventually increase carrying costs. The study also revealed that unavailability of fully computerized system of inventory controlling, lack of up to date recording of inventories, lack of adequately trained staff, there is weak communication among warehouses about excess and shortage of spare parts, lack of using scientific and preventive approaches to maintain the buses and utilize spare parts efficiently. The researcher recommends that ACBSE has to support its activities with Information Technology, train employees in inventory processing department to modernize services, prepare up to date manuals, give concentration to efficient utilization of spare parts, recording history sheets for each buses and using information for decision making, disposing the accumulated obsolete spare parts to decrease its carrying cost, and the Technique department has to focus on preventive maintenance approach to minimize consumption of spare parts.