CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND
OF THE STUDY
The research work is based on the
effect of Local content on productivity in a manufacturing industry, with
special reference to Nigeria Bottling Company Plc Kaduna.
According to Arizona-Ogwu L.C.
(2008), local firms are ultimately and probably the most important driver of
economic income and growth in a manufacturing industry. The objective of local content on
productivity are to increase value-added content, thereby contributing to
economic development and transfer technology and also develop local know-how.
Developing local content projects
also meets the expectations of an increasing number of productivity. For manufacturing industries, local content
is a way of stimulating the economy, building capacity and enabling skill
transfer.
1.2 STATEMENT
OF THE PROBLEM
No organization or company be it
public or private will survive without encountering some problems. However, these problems differ depending on
the nature of business policy of the organization. Some of the problems are:
i)
Constant
intervention of some management functionaries in local content function. This has resulted in a waste of company’s
limited resources via poor local content performance.
ii)
Diversification
of export trade in terms of both destination and product.
iii)
Establishment
of inter-linkages between trade and industry.
iv)
Equity
in the distribution of benefits of liberalized trade policy between small and
cottage industries and large industries.
v)
Maintain
balance between labour interest and private sector development.
1.3 OBJECTIVE
OF THE STUDY
The researcher has a personal
interest in local content in a manufacturing industry which will increase value
added content, thereby contributing to national economic development and
transfer technology to develop local know-how.
The research work will also assist those companies that does not
encourage local content to make reference to the research work so as to extract
the benefit of local content to help productivity in the manufacturing product
and continuity.
1.4 STATEMENT
OF HYPOTHESIS
Hypothesis is a concise statement or
tentative proposition that are to be tested based in the findings of the study.
Hypothesis consists of a set of
declarative statement that are derived from topic or title of the research
work. In this research work the
researcher has decided to formulate one set of hypothesis of the null
hypothesis (H0) and the alternate hypothesis (H1).
H0:
Local content does not enhance a
company’s efficiency and profitability.
H1
Local content enhances a
company’s efficiency and profitability.
1.5 SIGNIFICANT
OF THE STUDY
The researcher work on the effect of
local content on productivity in a manufacturing industry in Nigerian Bottling
Company Plc. Kaduna as the case study is significant in the following ways:
a)
it
encourages buying the things we need locally cutting out the high shipping and
marketing cost associated with products that travel long distance to get to us.
b)
It
helps in identifying more effect of materials which has not been utilized by
the industry to bring about better control on productivity.
1.6 SCOPE
OF THE STUDY
The researcher work is planned in
such a way to enhance local content in Nigeria Bottling Company Plc and also
improving employees performance.
1.7 LIMITATION
OF THE STUDY
Delimitation; this study is
restricted to Nigerian Bottling Company Plc Kaduna. The success of this research work resolves
round the availability of fund. Fund is
required for data collection, typing of the manuscript and building of the
project. Having spoken of the need to be
financially alright during the study, the writer cannot help but express the
financial difficulties faced in transporting herself to the industry which is
very far away. Another prominent problem
is time, the time within which the study is to be carried out is acute. This made the research work uneasy for the
researcher.
1.8 HISTORICAL
BACKGROUND OF THE CASE STUDY
The Nigeria Bottling Company (NBC)
Greek-own company with branches in more than 180 countries all over the world
including Nigeria.
Nigeria Bottling Company, makers of
Coca-cola, Fanta and Sprite etc, first came to Nigeria in 1953 with its first
plant established in Lagos. It was the
beginning of an existing story of growth and development particularly during
the past 12 years. Nigerian Bottling
Company is today Nigerians number one bottler of soft drink as claimed by the Marketing
Manager of the company, selling more than eight million bottles per day, a
figure which is still growing with the continuing expansion of the existing
plants and the opening of new plants in various parts of the Federation. Fanta is by far number one best seller in the
orange segment and sprite the most widely sold lemon drink in Nigeria. Other
products bottled by Nigeria Bottling Company includes: Schweppes, Fanta tonic,
Eva water, Five alive brand name product etc.
Nigerian Bottling Company is a
subsidiary company of Leventis Group, which serves as its parent company. The Nigerian Bottling Company has two
sections – soft drinks and agricultural section. The company now operates on
large scale agricultural programme with two farms situated at Zaria in Kaduna
State. It established three depots under
Kaduna plant; they are Abuja, Zaria and Minna.
The plants in Kaduna is headed by a plant manager to whom five sectional
heads reports. The section that make up
the plant and who are to report to the plant manager are; Clinic, Ales
production, Accounting and Engineering.
1.9 DEFINITION
OF TERMS
The following terms are the words
used in the course of this research work.
Local Content: This
refers to local requirement, training, purchase of local goods and services
that are designed to develop the infrastructure and skills of the people.
Raw Materials: This
is the basic materials from which a product is manufactured or made.
Evaluation: This is access or form an idea of the amount, quality or
value of something.
Productivity: This
is a measure of the effective use of resources, usually expressed as a ratio of
output to input.
Quality: This
is the degree or group of excellence appropriate for a particular purpose or as
a totally and characteristic product or services that bears on its ability to
satisfy a given need.