The Optimization of Inventory Management in Nigerian Production Companies

Inventory management is a critical determinant of operational efficiency, cost control, and competitiveness in production companies. In Nigeria, production companies face unique challenges including supply chain disruptions, foreign exchange volatility, infrastructural deficits, and demand uncertainty, which complicate inventory optimization (Olusegun & Adebayo, 2018). This study examines the optimization of inventory management in Nigerian production companies, focusing on ALSCON Limited, Ikot Abasi, Akwa Ibom State, Nigeria, a major production company in the metallurgical sector. Using a mixed-methods approach, data were collected from operational records, inventory reports, and structured interviews with supply chain managers between 2018 and 2023. Findings reveal that “ALSCON's adoption of Economic Order Quantity (EOQ), Just-In-Time (JIT) practices, and Enterprise Resource Planning (ERP) modules reduced holding costs by 18% and stock-out frequency by 27% over three years” (ALSCON Internal Report, 2022). However, erratic power supply, import delays, and inaccurate demand forecasting remain significant constraints. The study concludes that integrating AI-driven demand forecasting, vendor-managed inventory (VMI), and localized sourcing can further optimize inventory performance in Nigerian production companies. Policy recommendations include adopting just-in-time (JIT) inventory systems, investing in digital inventory systems, public-private collaboration to stabilize supply chain infrastructure and regularly reviewing of inventory management policies.