ABSTRACT

This research work centers on the impact of cost reduction scheme on the profitability of manufacturing firm.it involves investigating the various strategies by which cost could be reduced and the problems affecting the effectiveness of such strategies. Various literatures were reviewed with references. Cost reduction techniques involves a deliberate measure built into a system operation and of production with the aim of lowering the total cost of production or operation while still maintaining the same if not quality product produced or services rendered. The techniques are value analysis, work study, organization and method, quality circle, just-intime etc. the manufacturing firm used for this research work is port-Harcourt flour mill; the data collected were primary and secondary data. The primary data which is the questionnaire administered to the firm and also personal interview conducted while the secondary data are existing document. The population derived from the firm is seventy, the sample size was derived from the population by use of sampling tool called Taro Yamani formula and the sample size derived is (59) also the sampling technique used was judgmental, fifty nine questionnaire were distributed and forty (40) were returned duly filled and completed the hypothesis were analyzed using the simple regression method. One of the major findings that cost reduction scheme makes tremendous impact on the profitability of manufacturing firm. Based on the findings the researcher made recommendation, one of which is seminar, symposia, and work shop should be held for management personnel in order to enable the company update its knowledge of cost reduction scheme.