Analysis of inventory control systems: A case study at Air-mate gas Factory, Ghana.

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Many Organizations face great challenges in managing inventories. Poor inventory management may result in under-stocking, overstocking as well as high inventory total cost. This thesis examines inventory situation at Air-Mate Gas Factory, Ghana. The objective of this paper is to develop the Economic order Quantity (mathematical) model that will be used to determine number of units of gases to be ordered at a time and the re-order point, that is the level to which stocks are allow to fall before ordering for the various imported gases. The resulting EOQ for each gas is compared to the actual ordered quantities so as to see whether there is any relationship between them in operational cost reduction. The study used secondary data from Air-Mate Gas Factory, Ghana. The results show that the relationship between the EOQ’s and the ordered quantities at Air-Mate Gas Factory, Ghana in terms of cost reduction was significant. Therefore it was concluded that the ordered quantities of gas at Air-Mate Gas Factory, Ghana were not optimal. Therefore it is recommended that in order to manage inventory effectively, Air-Mate Gas Factory, Ghana needs to employ inventory control model such as the EOQ model to obtain reasonable ordered quantities for its gases.
A thesis submitted to the Institute of Distance Learning to the Department of Mathematics of Kwame Nkrumah University of Science and Technology in partial fulfillment of the award of Master of Science (Msc.) Industrial Mathematics, 2014