Inventory Management and Small Firms Growth: An Analytical Study in Supply Chain

Abstract

Inventory management augments business operations by effective flow of goods and services. It adds to profitability, competitive ability, service optimization, market diversification, etc. This article investigates the role of inventory management in fostering small firms’ growth. The research framework and hypotheses were examined by the empirical analysis of primary data collected from 44 functional manufacturing units sub-divided into ten lines of operation in district Udhampur, in Jammu & Kashmir (J&K). Validity and reliability of the scales in the construct were assessed through Bartlett’s Test of Sphercity (BTS) and Cronbach-alpha test. The results of regression model and analysis of variance (ANOVA) revealed that proper inventory management leads to economy and efficiency, nurtures competitive ability and paves way for cost reduction. Further results divulged that managers of different age group don’t significantly differ with regard to inventory control techniques. To promote inventory management, integrated strategic planning encompassing logistics, promotional-mix, technological capabilities and industrial promotion campaigns by government are needed.