Abstract
The production and delivery of high quality goods and services that satisfy customers’ expectations are essential elements in determining the long term achievement of manufacturing companies. This paper aims to develop efficient lead time management in the supply chain processes of Nigerian fast moving consumer goods (FMCGs) manufacturing companies as this would enhance the production of indigenous products of high quality thereby satisfying the consumers’ needs, moreover, contributing to economic growth and development of the manufacturing industry in Nigeria. The study uses a quantitative approach consisting of a cross-sectional survey and the administration of structured questionnaires to staff of FMCGs in selected study areas of Lagos and Ogun State, Nigeria. The data available for this study was analyzed using ordered logistic regression model with the aid of different statistical tool; SPSS IBM version 24 and STATA 13.0. The outcome of the study indicated the underlying dimensions of lead times and the service response level of customers, with an overall objective to meet customers’ needs. Furthermore, the result showed that adequate stock level and reduction in lead times contributed to the availability of quality products to customers on time . Keywords: Supply chain, Lead time, Customer satisfaction, FMCGs, Manufacturing industry. DOI : 10.7176/JESD/10-2-13
Highlights
The increase in global competition and market uncertainty brings about opportunities along with threats for manufacturing firms, a supply chain that responds proactively to the fluctuating demand patterns for finished goods give room for production managers to take decision in the purchase, production, storage as well as in the distribution of finished goods to consumers
The manufacturing sector which is one of the key indices of growth and development in Nigeria, have suffered negligence over the years due to the overdependence of the Nigerian economy on the oil sector and the disregard of other sectors that boost manufacturing activities (Mojekwu, 2012). It seems the operators of the sector have not taken into consideration the importance of efficient optimization strategies in the performance of their day to day supply chain activities, so as to improve on the responsiveness in the relationship with its customers. With the challenges it face, the Nigerian manufacturing sector’s contribution to real Gross Domestic Product (GDP) dropped from =N=8.97Tn to =N=8.89Tn; and the GDP annual growth rate was estimated at 2.7 percent and -1.5 percent in 2015 and 2016 (Akinmulegun and Oluwole, 2013), the need to develop responsiveness in the supply chain processes: operating at lower inventory level while maintaining high service levels; improving forecast accuracy; improving product and order lead times; reducing the scheduling cycle from days to hours; and producing the right mix of products that are of high quality, at the right price and delivered to customers at the right time is of great essence
While the components of product lead time such as administrative time of order, and average time distance between processed goods and service to customers are at positive level to the availability of quality products to customers, the average value added time on order is indirect to the availability of quality products to customers in the fast moving consumer goods (FMCGs) industry
Summary
The increase in global competition and market uncertainty brings about opportunities along with threats for manufacturing firms, a supply chain that responds proactively to the fluctuating demand patterns for finished goods give room for production managers to take decision in the purchase, production, storage as well as in the distribution of finished goods to consumers. The manufacturing sector which is one of the key indices of growth and development in Nigeria, have suffered negligence over the years due to the overdependence of the Nigerian economy on the oil sector and the disregard of other sectors (agriculture, mining, energy and infrastructure) that boost manufacturing activities (Mojekwu, 2012). It seems the operators of the sector have not taken into consideration the importance of efficient optimization strategies in the performance of their day to day supply chain activities, so as to improve on the responsiveness in the relationship with its customers. With the challenges it face, the Nigerian manufacturing sector’s contribution to real Gross Domestic Product (GDP) dropped from =N=8.97Tn to =N=8.89Tn; and the GDP annual growth rate was estimated at 2.7 percent and -1.5 percent in 2015 and 2016 (Akinmulegun and Oluwole, 2013), the need to develop responsiveness in the supply chain processes: operating at lower inventory level while maintaining high service levels; improving forecast accuracy; improving product and order lead times; reducing the scheduling cycle from days to hours; and producing the right mix of products that are of high quality, at the right price and delivered to customers at the right time is of great essence
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