ABSTRACT
The aim of this research study is to examine The Impact
of Intensive Distribution Strategy on Marketing of Consumer Goods using Dotmall
Nigeria Limited as a case study.
To achieve the above stated objective both primary and
secondary sources or data collection which include the use of questionnaires to
elicit information, and review of textbooks, journals, internet sources etc.
were used. Statistical tools such as frequency distribution, simple percentage
tables and the Chi-Square (x2) were
used.
The findings in the hypotheses tested showed that; the
company uses an intensive distribution strategy for the distribution of its products.
Convenience goods must be made available at every point where they can get
them, and at all times; bad roads and poor storage facilities are factors that
impede effective distribution of goods and services.
Based on these findings, organizations should ensure a
proper definition of roles, right and responsibilities of channel members as the
conflict of interest among these members could greatly affect the marketing of
the company's products; Careful study must be carried out by organizations to
ensure the right distribution strategy is selected for the tight type of
product(s) to avoid putting a square peg in a around hole.
TABLE OF CONTENTS
Title Page i
Certification ii
Dedication iii
Acknowledgement iv
Abstract v
Table of Content vii
CHAPTER ONE:
INTRODUCTION
1.1 Background of the Study 1
1.2 Statement of the Problem 3
1.3 Objectives of the Study 4
1.4 Significance of the Study 5
1.5 Research Questions 6
1.6 Research Hypotheses 7
1.7 Scope of the Study 8
1.8 Limitations of the Study 8
1.9 Definition of Terms 9
CHAPTER TWO: LITERATURE REVIEW
2.0 Introduction 11
2.1 The Conceptualization of Distribution 11
2.2 The Objectives of Distribution 14
2.3 Choosing A Channel of Distribution 16
2.4 Distribution Strategy/Intensity of Channel 19
2.5 Distribution Channel for Consumer Goods 23
2.6 Importance of Physical Distribution 27
2.7 Major Components of Physical Distribution 28
References 37
CHAPTER THREE: RESEARCH METHODOLOGY
3.0 Introduction 38
3.1 Research Design 38
3.2 Sources of Data 39
3.3 Data Collection Instrument 39
3.4 Sampling Method 40
3.5 Population and Sample Size 40
3.6 Method of Data Analysis and Procedure 41
3.7 Restatement of Hypotheses 42
3.8 Administration of Questionnaire 43
CHAPTER FOUR: DATA
PRESENTATION AND ANALYSIS
4.1 Introduction 44
4.2 Analysis of Personal Data from Questionnaire 45
4.3 Analysis of Data from Questionnaire 49
4.4 Test of Hypotheses 56
CHAPTER FIVE: SUMMARY, CONCLUSION AND
RECOMMENDATIONS
5.1 Summary 66
5.2 Conclusion 69
5.3 Recommendation 69
Bibliography 71
Questionnaire 73
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The aim of marketing as a set of individual and
organizational activities is to ensure that consumer wants, needs and
preferences are appropriately and properly satisfied in order to ensure customer/consumer satisfaction and
at the same time achieve the goals of the individual or organization. Marketing
ensures that goods and services are not only produced, but also ensure that
these goods are made available to the consumers at the right time, place and in
the right quality.
The goal of marketing is achieved through the marketing
mix elements - Product, Price, Promotion, and Place (distribution). Marketing
ensures that these marketing mix elements combined in the right proportion, at
the right time, and in the right sequence in order to meet the requirement of
the target market.
Distribution which is one of the marketing mix elements
is the subject of this study. The major aim of distribution is to ensure that
goods and services move from the points of production to the points of
consumption. This involves not only the physical movement and handling of
products, but also the transfer of title as well. It is important to point out
that distribution is a broad concept.
Agbonifor et al (1998), defined distribution as ''the
flow of title to goods and the movement of those goods from point of production
to the point of consumption."
Kotler (2008) defined distribution as "involving
tasks of planning, implementing, and controlling the physical flow of
materials, final goods, and related information from points of origin to points
of consumption to meet customer requirement at a profit." He stated
further that distribution as a resource in marketing is used to make the
product available at the right place and in the amount that the target group
wants it. Without distribution systems,
organizations would expend more of their funds or trying to build their own
infrastructure for reaching customers.
It is necessary to mention that distribution is made of
two broad aspects namely; channel of distribution often referred to as
marketing channel or trade channel, and physical distribution (logistics). A
definition of physical distribution is same as earlier stated according to
Kotler. Channel of distribution refers to the pathway or course taken in the
transfer of title to a product as well as the individuals and institutions that
participate in the distribution of goods from points of production to the point
of consumption.
Firms adopt different distribution strategies in the
marketing of their products. They may use exclusive, intensive, or selective
strategy. It should be noted that the strategy selected depends on the firm and
the nature of its products.
In the past, physical distribution typically started with
products at the plant and then tried to find low-cost solutions to get them to
the customers. However, today's marketers prefer customer-centered logistics
thinking, which starts with the market place and works backward to the factory,
or even to source of supply. Therefore, as the world market is becoming more
and more competitive, a firm that wants to be successful must carefully plan
its distribution policy to ensure that goods not only are available, but are
able to set to the right customers at the right time and place, and at the
right quantity and quality.
1.2 STATEMENT OF PROBLEM
The following may be identified as problems associated
with distribution of consumer goods and services, using Dotmall Nigeria Limited
as a case study:
ü Many organizations do not have a well-structured
distribution policy that could help in the effective distribution of their
products.
ü Companies also especially small scale businesses fail to
associate effective distribution program with the successful marketing of their
products.
ü Also, many organizations face the problem of selecting
the right distribution strategy for their products.
ü The distributors in most cases face the problem of
conflict of interest thereby, neglecting the fundamental purpose of
distribution to their own profit interest.
ü Inappropriate definition of responsibilities and rights
between firms and their distributors has also affected effective distribution
of consumer goods.
ü More prominent among the problems facing effective
distribution in Nigeria is the issue of bad transportation facilities, e.g.
transportation, warehousing etc.
1.3 OBJECTIVES OF THE STUDY
The objective of any distribution strategy is to ensure
that goods and services get to the customers at the right time, place, quantity,
and in the right quality. The objectives of this study are as follows:
ü To find out the effect of ill-structured distribution
policy on effective distribution of consumer goods.
ü To examine the extent to which effective distribution
policy affects the success of a marketing program.
ü To evaluate the how a distribution strategy at a
particular time affects the effective distribution of consumer goods and
services.
ü To examine how conflict of interest in the distribution
channels affect the distribution program.
ü To examine the effect of ambiguous definition of rights
and responsibilities on effective distribution of goods and services.
ü Lastly, the objective of this study is to assess the
effects of bad roads and inadequate storage facilities on the effective
distribution of goods.
1.4 SIGNIFICANCE OF THE STUDY
The major significant of this research work is to the
researcher. This is because the research work: is required in partial
fulfillment of the requirement for the award of the Bachelor of Science (Bsc)
in Marketing.
The research work is also of great significance to the
case study as a source of eliciting information for the best combination of the
promotional mix strategies.
Also, the research work is of great significance to the
distributing sub - sector or firms in order to realize the importance of
effective distribution policy and strategies in the present complex and dynamic
business world. This is the ideology
behind the slogan, "Production is not completed until the goods get to the
final consumers".
The research work will also reveal to the firms and organizations
involved in distribution, variables that can help to improve effective
distribution.
Lastly,
the research work will ultimately criticize the past work of different scholars
in order to validate their assertions on the subject matter. Findings shall
determine if such assertions shall be accepted or refuted.
1.5 RESEARCH
QUESTIONS
This
research work will seek to answer questions related to problems that have been
stated earlier on in this chapter. The questions are as follows:
ü What is the effect of ill-structured distribution policy
on effective distribution of consumer goods?
ü To what extent has the effective distribution policy
affects the success of a marketing program?
ü What is the effect of each of the distribution strategy
on the effective distribution of consumer goods and services?
ü How has conflict of interest in the distribution channels
affect the distribution program?
ü What is the effect of ambiguous definition of rights and
responsibilities on effective dis1ribution of goods and services?
ü What are the effects of bad roads and inadequate storage
facilities on the effective distribution of goods?
1.6 RESEARCH
HYPOTHESIS
Hypotheses are tentative statements about the relationship
between two or more variables. For the purpose of this study, the following
hypotheses will be tested:
The Null Hypothesis (Ho) and the Alternate Hypothesis
(Hi)
HYPOTHESIS 1
Ho: The number of channel members in the distribution
chain does not have any impact on marketing of consumer goods.
Hi: The number of channel members in the
distribution chain has an impact on marketing of consumer goods.
HYPOTHESIS 2
Ho: Successful distribution strategy does not
depend on selecting the right distribution channel.
Hi: Successful distribution strategy depends on
selecting the right distribution channel.
HYPOTIIESIS 3
Ho: There is no significant relationship between
distribution distance and the volume of sales.
Hi: There is a significant relationship between distribution
distance and the volume of sales.
1.7 SCOPE OF THE STUDY
This research project is mainly concerned with the impact
of intensive distribution strategy on marketing of consumer goods, with Dotmall
Nigeria Limited as the case study. Questionnaires shall be distributed to the
staff of the company in their various departments and top personnel. The scope
of the study will also be limited to the company's head office at Ikorodu,
Lagos State.
1.8 LIMITATIONS
OF THE STUDY
These are the major factors that inhibit the research
work. Among other things are the following:
The inability to accurately complete the questionnaire,
and the difficulty in comprehending what is actually required stands as hindrances
to the research work.
The lack of financial aid also stands as a bottleneck to
the progress of this research work. In as much as virtually all companies
engaged in one form of distribution or the other are unevenly dispersed around
the town, it becomes a tedious task if not impossible for the researcher to go
round all the companies in the country to make enquiry.
Accurate data is basic to any research work, so to say,
but it is quite unfortunate that accurate data is not obtainable in Nigeria.
Data required are not available and where available, they are mere estimates
and not obtained through rigorous research work. Inadequate texts in the
library are also a constraint here. Other factors that stood as constraint to
this research are time factors, secrecy on the part of the respondents to give
vital information.
1.9 DEFINITION OF TERMS
MARKETING: This consists of individual and organizational
activities designed to identify and satisfy consumer needs, wants and
preferences and to facilitate and expedite exchange.
MARKETING MIX:
Kotler (2008) "is a set of controllable
tactical marketing tools - product, Price, place, and Promotion - that the firm
blends to produce the responses it want in the target market.
PRODUCT: Anything that can be offered to a market for attention,
acquisition or consumption in order to satisfy a want or need.
DISTRIBUTION: This refers to the flow of title to goods and the
movement those goods from point of production to point of consumption.
PHYSICAL
DISTRIBUTION: This is the flow of
materials, final goods and related information from the point of origin to the
point of consumption to meet customer needs at a profit.
CHANNEL OF
DISTRIBUTION: This is the pathway
or course taken in the transfer of title to a product as well as the
individuals and institutions that participate in the distribution of goods from
points of production to the point of consumption.
CONSUMER GOODS: These are goods purchased for personal or household
use.
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