CHAPTER ONE
INTRODUCTION
1.1 GENERAL BACKGROUND OF THE SUBJECT MATTER
The Nigerian Management of small business area is characterized by high cost of financial resources. A cursory look of the markets in Enugu South Local Government reveals an upward trend in prices of goods both consumer goods and capital goods. This is associated with the high interest rate prevalent in Enugu South Local Government Area of Enugu State. Under the above mention condition, the question becomes that of the fittest. Large established merchandizing companies tend to marginalized that of small scale industry as small scale industries find it very difficult if not absolutely impossible to qualify for granting of loans from finance houses partly because of the high interest rate associated with such grants and partly as a result of absence of sufficient collateral. In view of the above facts, it becomes pertinent for those small scale industries to resort to other means such as inventory control and management of cash, debtors and creditors which make for higher profit so as to survive the out threat competition with the large firmly established merchandising firms and industries. There is no generally accepted definition of small-scale business. The committee for economic development of the united state gave a valuable list of characteristic which a small business will have, and these are: Managers are also owners, area of operations are mainly local, owner supplied capital and small in size within the industry. It is the low productivity of those small scale industry in Enugu that necessitated this study: an urge for an efficient stock control system in order to optimise investments in stock at minimum costs and at optimum profits. This efficiency is achieved primarily by maintaining stock level at a balance between too much stock and too little stock and at the same time maintaining a given level of consumer service
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