| Abstract [eng] |
The main purpose of this master thesis is to determine the impact of inventory management on the net profitability of Lithuanian furniture manufacturing companies. The work consists of two main parts; the analysis of literature, the research and its results, conclusion and recommendations. The literature review reviews the importance and need for inventory management in the furniture manufacturing sector. The analysis of the Lithuanian furniture manufacturing industry and the analysis of inventory management methods and tools are performed, the advantages and disadvantages are presented. Factors affecting the net profitability of companies are identified. An analysis of the research is presented. After the literature analysis the author used correlation, regression and questionnaire data analysis were used to assess the impact of inventory management on the net profitability of selected Lithuanian furniture companies. The financial data of companies in 2016-2020 were used for the empirical qualitative research. The data were selected from the financial statements of medium and large companies. The correlation coefficient was used to find the relationship between inventory turnover days and net profitability and, in addition, the relationship between inventory turnover and net profitability with the debt ratio and the overall solvency ratio. The regression analysis determined the impact of inventory management on net profitability and the impact of gearing and gross solvency ratio on net profitability. A questionnaire survey was conducted to gather additional information on the companies involved in the investigation. To study the impact of inventory management on the net profitability of companies in the Lithuanian furniture manufacturing sector, 64 Lithuanian furniture manufacturing companies were selected, which belong to the categories of medium and large companies. A correlation analysis between inventory turnover days and net profitability showed a correlation coefficient of -0.454. This means that a decrease in inventory turnover on days increases net profitability and vice versa. Regression analysis showed a regression coefficient of -0.105 on inventory turnover days, which means that a decrease in inventory turnover on day 1 would increase net profitability by 10.5%. The questionnaire survey found that companies using the inventory management method / system have higher net profitability and lower inventory turnover in days. An analysis of the financial statements based on the use of the inventory management model / system has shown that the company using the StockM system has the lowest average net profitability and the highest average inventory turnover in days. Companies that use the SAP ERP system and the integrated production management (CIM) system have high average net profitability and low average daily inventory turnover. The conclusions and recommendations summarize the main concepts of the literature analysis and the results of the research. The author believes that the results of the study could provide useful guidance for companies that intend to use an inventory management model / system, and already for companies that use an inventory management model / system to choose which model is most beneficial to use. |
