Analysis of the Impact of Inventory Management Practices on the Effectiveness of Retail Stores in South Africa

Abstract

The study analyses the impact of inventory management practices on the effectiveness of retail stores in Vhembe District, South Africa. A quantitative research design was adopted for the study. The study used a simple random sampling method to collect data from 30 retail stores. Results from the survey revealed that inventory management tools and techniques like economic order quantity, just-in-time, barcoding and inventory management software have a positive effect on the performance of retail stores. This is because the quality of service delivery to customers was improved, thereby outperforming competitors. Also, sales and turnover increased as over-stocking and under-stocking were effectively managed giving rise to a higher return on investment. The major conclusion drawn from the study was that the adoption of inventory management practices positively affects the retail businesses in Vhembe District.