COST CONTROL AND PROFITABILITY OF LISTED MANUFACTURING COMPANIES IN NIGERIA

Abstract

Due to intense competition, high labour and other manufacturing costs, and differences in currency rates, many businesses fall short of the profitability that owners had hoped for. The alarming rate of winding up manufacturing outfit in Nigeria were linked to high cost of operation, as many businesses are unable to withstand price wars. The study investigates cost control and profitability of listed manufacturing companies in Nigeria, with reference to ten listed manufacturing businesses in Nigeria. The study employed an ex-post facto research design. Secondary data was incorporated by this study through the financial statements of the chosen firms, which entails a ten-year period (2014-2023). Descriptive statistics, correlations, and regression were employed to analyze the data. The study found that net profit margin of the selected firms is significantly affected by cost of sales and distribution cost. The study concludes that potential investors can rely on cost of sales and distribution cost in forecasting net profit margin of the selected listed manufacturing outfits. It was recommended that management of Nigerian manufacturing companies should routinely assess the production and operational costs of their companies which will in turn improve the firms’ profitability.