ASSESMENT ON INVENTORY MANAGEMENT PRACTICE AND ITS CHALLENGES IN CASE OF ADDIS PHARMACEUTICAL FACTORY S. C.IV-SOLUTION ADDIS ABABA

Abstract

Cross-sectional study was conducted to assess inventory management practice in case of Addis pharmaceutical factory iv-solution which is present in Addis Ababa. The study was conducted on stuffs of planning and warehousing, finance department and procurement departments. The study was conducted using document analysis and survey of respondents of staff who have relevance in the inventory management directly or indirectly. Descriptive analysis was conducted to identify main challenges created in the inventory management process; current practices of inventory management in APFIV; techniques of inventory control the company use; policies, manual and procedure established in regard to inventory management practice and the company controls for identified gaps in regard to inventory management. During the research most of the respondent 68.2% of them were agree on APFIV materials management function has workable organizational structure and from these only 8.2% of them were not agree on this. Also the result shows most of the respondents 55 (64.7%) of them stands for agree on the department has integrated inventory and storage policy and 12(14.1%) of them said that they were strongly agree on this. But only 4(4.7%) of them were disagree on this. Thus we can see the department has integrated inventory and storage policy. As a result shows; the main challenges in the company identified during the study includes inventory process of reorder take longer period of time and during reorder there may be shortage of raw materials so it may cause delay of time for these orders. There were also system or software challenges means there were inadequate software and use manual documentation in the company. There were also Procedural problems in the company, supply chain complexity, insufficient order management, challenges of replenishment and damage and dead materials removal from warehouse is not taken place timely. Then the results of correlation and regression analysis shows that the above independent variables which have relation during analysis with dependent variable (inventory management) were at less than 0.05 significant levels.