ABSTRACT
The study, relevance of pricing decision on achieving retail market growth in Owerri metropols Imo state, Nigeria. the research seeks to investigate the extent of relationship between pricing decision and marketing performance of retail business however to achieve this business growth of the study, experimental research design was used , where thirty (30) questioner were administered to the 5 selected supermarket in order to obtained first hand information . After a critical analysis of data collected, the hypotheses were tested using the analysis of variance (ANOVA) and the following were the findings: pricing decision contributes significantly to the marketing performance of the industry. Moderating factor interfere in the relationship between pricing decision, marketing growth of retail industry. Based on the findings of the study, the following were recommended institution should improve on their pricing strategy to enhance its effectiveness. also they should frequently monitor the environment within which they operate to enable them identify current opportunities or threat and competitively position them selves. They should ensure that their pricing object is in line with their pricing decision. They should always consider the fact that affects their pricing decision.
TABLE OF CONTENTS
Title page i
Certification ii
Declaration iii
Dedication iv
Acknowledgement v
Table of content vi
List of tables viii
Abstract ix
CHAPTER ONE
INTRODUCTION 1
1.1 Background of the Study 1
1.2 Statement of Problem 6
1.3 Objectives of the Study 6
1.4 Research Questions 7
1.5 Hypothesis Formulation: 7
1.6 Significance of the Study: 8
1.7 Scope of the Study: 9
1.8 Limitation of the Study. 9
1.9 Definition of Terms 9
CHAPTER TWO
LITERATURE REVIEW 11
2.1 Introduction 11
2.2 The Nature of Pricing. 12
2.3 Pricing Objectives. 13
2.4 Price Determinant as Factors Influencing Pricing
In Retail Outlets. 18
2.5 Pricing Strategies/Method 20
2.6 Pricing Problems 28
2.7 Significance and Justification of Pricing Decision or Policy. 29
2.8 Situational Factor. 31
2.9 Performance Measure 31
CHAPTER THREE
RESEARCH METHODOLOGY 33
3.1 Introduction 33
3.2 Research Design. 33
3.3 Area of the Study 35
3.4 Population of the Study. 36
3.5 The Sample Size. 38
3.6 Sampling Procedure 38
3.7 Methods of Data Collection. 38
3.8 Methods of Data Analysis. 39
CHAPTER FOUR
4.0 DATA ANALYSIS/DISCUSSION OF RESULTS 42
4.1 Introduction 42
4.2 Presentation and Analysis of Data. 44
4.3 Interpretation of the Finding. 72
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION. 73
5.1 Summary And Discussion Of Findings. 73
5.2 Conclusion. 73
5.3 Recommendation. 74
REFERENCES
LIST OF TABLES
Table 4.10 Response on how distribution channel enhances your marketing growth.
Table 4.11: Response on how Market demand affects the pricing decision
Table 4.12: Response on the firm’s pricing strategy that increase it’s market share.
Table4. 13: Response on Cost Oriented pricing adopted by the firm.
Table 4.14 Response on the Firm demand oriented pricing.
Table 4.15: Response on the firm on competitive oriented pricing.
Table 4.16: Response on Penetration pricing strategy.
Table 4.17: Response on Discrimination pricing strategy.
Table 4.18: Response on skimming pricing strategy.
Table 4. 19: Response on Sales growth included by the firms pricing policy.
Table 4.20: Response to pricing decision that contributes to Profit growth of the firm.
Table 4.21: Response on Market Share achieved through pricing decision.
Table 4.23: Contingency Table 1 was drawn from all the tables
Table 4.25: Contingency Table 2 was drawn from the entire Moderating factors table.
Table 4.1: Responses on pricing objectives.
Table 4.2: Responses on profit maximization.
Table 4.3: Responses on Return-on-investment
Table 4.4: Responses On Competitive Pricing Objectives.
Table 4.5: Responses on Price Stabilization Objectives
Table 4.6: Responses on the Effect of pricing objective and the marketing performance
Table 4.7: Response on the government policies regulates the competition between price decision and the marketing performance.
Table 4.8: Response on Consumer Income influence on the market performance of the firm.
Table 4.9: Response on Cost of production that stimulates profit growth of the firm.
Table 4.0 Questionnaire distribution.
CHAPTER ONE
INTRODUCTION
1.4 Background of the Study
Nigeria over the year has been known to be a reseller economy owing to the fact that most of the goods consumed by it’s population comes from abroad and has very little manufacturing activities. Also, between 1985 and 1995, the Nigerian economy degenerated and became a dumping ground for all sorts of substandard product from far and neighbouring countries. This has slowed down the pace of development and threatened to do more worse. But thank God for democracy, the government under the Obasanjo, Yar’adua and now Goodluck regimes made enough efforts to fast tract the effects and revamp the economy.
Although there are a lot of small scale business springing up in the manufacturing sector, still the bulk of goods consumed by consumers are imported. Thus the activities of middlemen and specifically retailers remains as a major source of income to marketers and the nation at large. Retailing consists of those business activities involved in the sale of goods and services to consumers for their personal or household use. It is the final stage on the distribution process (Berman and Evans, 1998). In the same view Koiler, and Keller (2005) noted that retailing includes all the activities involved in selling goods and services directly to final consumer for personal and non-business use. They also maintained that retailer or retail store is any business enterprise whose sales volume comes from primarily retailing.
Berman and Evens (1998) observed that there is a tendency to think of retailing as primarily including the sales of tangible goods, however, it is important to recognize that retailing also comprises the sales of services. A service may be the shopper’s purchase (such as hair cut, delivery training etc). retailing also involves mail of telephone order, direct selling, internet transaction and vending machines sales. Retailing has a lot to do with “retailer”, manufacturers sometimes act as retailers when they sales goods or services to final consumer. Koiler and Armstrong (2005) concurring with the opinion that any organization selling to final consumers whether a manufacturers, wholesaler or retailers is doing retailing. It does not matter how the goods or services are sold or where they are rendered
Retailing is a major part of Nigeria’s commerce and it stated with petty trading or road side hawking to out door displays, small store to superstores. Kotler And Armstrong (2005) revealed that there are store retailer, non-store retailers and retail organization. They also added that retail store type pass through stages of growth and decline which can be described as retail lifecycle. In Nigeria, a lot of retail stores pass through this from non store retail to store retailer, from store retailers to super mail or retail organizations. Today, almost all the street have a retail outlet on it and the increasing number of these in and around majorities as becoming a nuisance to the extent that some retailer involves themselves son unhealthy competition. Although competition among retailers may focus on store image location, neatness, friendliness services level etc.
Price competition is the most widely used by retail outlets. The question here is since almost all retailers obtain goods from a particular source and at similar price, are there no standard for pricing products or services offered by retailers? If no standard exists than, what factors determine the pricing decision of retailing industries? Hopefully, before the end of my research, will come up with an answer to this question. Price is very important to both the seller sand buyer. These means that before a product or service becomes profitable, it must have been adequately priced. And before a buyer can make effective and efficient purchase, the price paid for such product must be evaluated with the satisfaction derived from it. Proper price determination and administration must be carefully made, so that objectives of both the buyers and sellers can be attained with minimum effort.
According to Onuoha (2004) price is defined as a sacrifice made to acquire a given product which may be monetary or non-monetary value. While Nwokoye (1993) said that price is the amount paid for goods and services. He further emphasized that price is derived by using the formular below:
P = Nx/Y units
P = Price
N = Naira
Y = Unit of output.
Ahamadu (1998) stated that price of a product determine the demand for such product.
The dangerous nature of pricing cannot be over emphasized due to it’s high sensitivity. That is why management of any business enterprise have to carefully adopt a sound pricing decision that will enable it to compete with competitors, increase market share and marketing profit.
1.5 Statement of Problem
Over the years, quite a number of studies have been made on pricing, and the findings indicate that pricing through the most sensitive volatile and delicate decision of an organization is the only element that can translate a firm’s products or service readily into cash and thus aids on the determination of an organization performance. As such, pricing decision must be done with utmost care, responsibility and dedication or the organizations life is at stake.
Despite the fact that studies made in the past by scholars the benefits firms stand to gain in making effective pricing decision. A larger percentage of organization in Nigeria does not take this very serious. These are reason consumers cry out on some business practice. They feel prices offered to them are not fair or they at times boy colt such companies products. This issue is common at point of purchase stores where retailers sell to final consumer.
Also determining a price that is fair is not enough but price that is profitable to the organization and acceptable by the industry. One major question here is since retail outputs in Nigeria do not produce product but buy readily made from companies or large distributors, what criteria or benchmark do they use in pricing their products? What factors affect their pricing practices and what pricing methods are adopted?
For these reason, this study will research more or the relationship between pricing decision and marketing growth in the retail industry in Imo State.
1.6 Objectives of the Study
The main objectives of the study is to determine the relevance of pricing decision on achieving retail market growth on Owerri Imo State. Other specific objectives are:
1. To determine if the pricing objectives pursued by retailer are in line with their overall marketing objectives.
2. To determine the factors that affect the pricing decision of retailer.
3. To determine the contribution of pricing method to retail outlet. 4. To determine the moderating factors that interferes in the relationship between pricing decision and market growth
1.4 Research Questions
1. Are the pricing objectives pursued by retailers in line with the business objectives?
2. What are they factors that affect the determination of price in the retail business?
3. How does pricing methods contributes to retail outlets?
4. How does moderating factors interfere in the relationship between pricing decision and market growth in the retail business?
1.5 Hypothesis Formulation:
Ho1: Pricing decision does not contribute significantly to retail business.
Ho2: Moderate factors does not interfere between pricing decision and retail business growth
1.6 Significance of the Study:
This study will explain more knowledge on the relevance of pricing decision on achieving market growth in the retail business. This work will also contribute to the following:
i. To broaden the theoretical and practical knowledge of the researcher on the relevance of pricing decision on the marketing objective of retail business.
ii. It will enable the retailers improve their pricing decision which consequently improves market share, sales, growth, profit ability and competitive position
iii. It will aid to the existing knowledge of management consultant whose service might be needed to evaluate a super market with low sales volume.
iv. Student and researcher can equally benefit if further research is required on this topic as such it will serve as a source of secondary data.
1.10 Scope of the Study:
The extent of coverage of this study is defined with the framing of the topic, pricing decision and market growth in retail outlet in owerri metropolis Imo State .
1.11 Limitation of the Study.
In the course of the study, the researcher encountered the problem of lack of finance and time constraints which made the researcher unable to achieve the desired goal accurately. In addition they were constraints in colleting the data as some of the respondents have confidential information they were reluctant to disclose also the problem of moving from one supermarket to another to get information needed for this work to be completed.
1.12 Definition of Terms
- Dumping ground: this is a place where unwanted materials are left.
- Non store retailer: These are group of retailers that does not have a store they sell their goods and services outside the confines of a retail facility.
- Boy Colt; this is a process retailer refuse to trade with some lay down procedure of the government.
- Benchmark: This is a process of establishing quality that serve as criteria for setting price or rendering services in a retailer outfit.
- Volatile; this is a process by which retailers change easily from their mood of services or mood of policy.
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