Pages: (1-14 )
Abstract
This study examines the influence of inventory management on the operational efficiency of small and medium-scale enterprises (SMEs) in Lagos State, Nigeria. SMEs play a vital role in the Nigerian economy, however, many struggle with inefficiencies due to inadequate inventory control systems. The purpose of this research is to assess how selected inventory management practices; namely Economic Order Quantity (EOQ), Just-In Time (JIT), lead time, and inventory turnover contribute to improving operational efficiency. The study is grounded in the positivist research philosophy, which emphasizes the use of observable and measurable data. A deductive research approach was adopted, beginning with theoretical assumptions and moving toward hypothesis testing. A descriptive survey design was used to obtain quantitative data from 503 registered SMEs across the manufacturing, retail, and service sectors in Lagos State. Copies of questionnaire were administered to SME owner-managers, and the collected data were analyzed using multiple regression analysis to test the hypothesis. Findings revealed that EOQ had a statistically significant and positive impact on operational efficiency, whereas JIT, lead time, and inventory turnover did not show significant effects. This indicates that systematic inventory practices like EOQ are essential for enhancing SME operations. The study concludes that inventory management is a key internal capability that can drive operational efficiency in SMEs when effectively implemented. It recommends increased awareness and adoption of EOQ models, as well as training programs and policy initiatives to strengthen inventory control capacity among SME operators. Future research could explore the moderating role of digital tools or supply chain integration.
Keywords: Economic Order Quantity, Inventory Management, Inventory Practices. Operational Efficiency, SMEs.,