ABSTRACT

The study determined the effect of inventory control on corporate performance of listed manufacturing firms in Nigeria, the specific objectives are to evaluate the effect of inventory turnover on return on asset, return on equity and profit after tax, the study adopted ex post facto research design and extracted data from cross section of 5 manufacturing firms over a period 7 years. Inventory turnover was used as proxy for inventory control and the dependent variable return on asset, return on equity and profit after tax were each employed on a 3 model framework. Based on the nature of data extracted, the panel least squares method of data analysis was engaged to investigate the relationship of the variables. It was found that inventory control has significant effect on return on asset and return on equity and profit after tax. The study therefore concludes that inventory control significantly affects corporate performance and recommends that Manufacturing firms should be efficient in the timing of requisition of inventory in order not to tie down funds needed for alternative investments so as to enhance profit, Management of manufacturing firms avoid holding too much of inventory as this will increase the total assets and reduce return on assets, Manufacturing firms should to minimize the cost of inventory in their operation. This will help increase profit that would enhance return on equity.