Acknowledgement
Chapter 1 Introduction
1.1
1.2
1.3
1.4
1.5
1.6
Background of Study
Problem Statement
Research Questions
Research Objectives
Significance of Study
Scope and Area of Study
Chapter 2 Literature Review
2.1
Introduction
2.2
Inventory Management Definition and Concept
2.3
Types of Inventory
2.4
CHAPTER 1:
1.0 Introduction
Chapter one aims to give an introduction of the background of this study. Furthermore it gives an explanation of company’s problems. Then the research questions and purpose of this study are presented. The chapter concluded with the delimitation of this study and the outline of following chapters.
1.1 Background of Study
In Malaysia, small and medium enterprises (SMEs) have a significant contribution to the economy. SMEs in Malaysia represented approximately of 99.2% of businesses and contributing
32% of the nation’s gross domestic product (Effendi, Talib, & Rani, 2011). The contributions of
SMEs to the nation’s gross domestic product will transform Malaysia into a highincome and knowledgebased economy. According to Datuk Hasfah Hashim’s new definition, SMEs are estimated to represent more than 98% of the total business establishments in the country, compared with 97.3 based on the earlier definition used in the Economic Census 2011 (Lim
Wing Hooi, 2014). SMEs are playing important roles in reducing the rate of unemployment in
Malaysia because it provides a large capacity of jobs to the public. SME sector is the largest provider of employment where it provides about 60% of job opportunities and contributes to
32% of Malaysia’s GDP and 19% of exports (Zieman, 2014).
Inventory management has become one of the main components in developing their competitiveness for their survival in the market. Inventory management is an activity that used to maintain the optimum amount of each type of inventory item. The objective of inventory management is to