INVENTORY COST AND FINANCIAL PERFORMANCE OF FOOD AND BEVERAGES MANUFACTURING COMPANIES IN NIGERIA

Abstract

The study determines the effect of inventory cost on the financial performance of food and

beverage manufacturing companies in Nigeria. The specific objectives guiding the study

include; determining the impact of inventory cost on the turnover and profit of food and

beverage companies in Nigeria. The research design adopted is Ex-post-facto. Three sample

sizes were purposively selected among the food and beverage companies quoted on Nigerian

Stock Exchange. Data on inventory components, turnover and profit, was extracted from

annual reports and accountants of selected food and beverage companies in Nigeria. It is

also discovered that inventory cost significantly affects the profitability of food and beverage

manufacturing companies in Nigeria. These findings imply that inventory cost is a major

determinant of the financial performance of food and beverage companies in Nigeria.

Recommendation: The management of the manufacturing organisation of food and beverage

in Nigeria should take effective measures in managing its inventory to enhance and improve

these companies' sales and profit performance.