THE APPLICATION OF LINEAR PROGRAMMING IN PROFIT PLANNING OF LOGISTIC FIRMS IN PORT HARCOURT

Abstract

This study examines the influence of the application of linear programming in profit planning of logistic firms in Port Harcourt. Descriptive survey research design was adopted for the study. The population of the study was 20 logistic firms in Rivers states. The study adopted a census study. 3 managerial staff (marketing manager, operational manager, logistic manager) were selected from each firm multiplied by 20 firms gives us a total of 60 respondents. The study adopted a Structured questionnaire instrument title” linear programming in profit planning questionnaire was developed on five-point likert scale. The result of the Cronbach's Alpha reliability test indicates .766 which is above .70 which implies that the items are reliable. Regression analysis was used to test the hypotheses using SPSS (statistical package social science) version 22. The study revealed that profit maximization has a significant influence on Activity-Based Costing of logistic firms in Port Harcourt. Profit Maximization have a significant influence on Incremental Budgeting of logistic firms in Port Harcourt. Cost Minimization have a significant influence on Activity-Based Costing of logistic firms in Port Harcourt. Cost Minimization have a significant influence on Incremental Budgeting of logistic firms in Port Harcourt. The study concluded that Linear programming is a powerful mathematical tool that can be effectively utilized in profit planning for logistic firms in Port Harcourt. By optimizing resources and maximizing profits, linear programming can assist these firms in making informed decisions to enhance their operational efficiency and financial performance. Through the formulation of mathematical models that consider various constraints and objectives, logistic firms can identify the most cost-effective strategies to achieve their profit goals. The study recommended that Logistic firms in Port Harcourt should invest in specialized linear programming software to facilitate the implementation of optimization models for profit planning. These tools can streamline the decision-making process and provide accurate solutions to complex logistical challenges.