DISTRIBUTION STRATEGIES LOGISTICS AND PERFORMANCE OF FIRMS IN PORT HARCOURT
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DISTRIBUTION STRATEGIES LOGISTICS AND PERFORMANCE OF FIRMS IN PORT HARCOURT
Abstract
This study focused on the distribution tactics, logistics, and performance of enterprises in Port Harcourt. The study centred on bakeries in Port Harcourt. It was thus limited to the Dripples Bakery in Port Harcourt. The survey research method was used to collect opinions from managers in the Marketing
Distribution, and Finance departments of four manufacturing enterprises chosen using convenience sampling for this study. The study’s primary data was collected mostly through questionnaires and oral interviews.
While information acquired from textbooks, journals, and internet sites served as a framework for hypotheses formulation and questionnaire construction.
The study showed that most consumer products manufacturers in Nigeria have not fully realised the benefits of a well-designed and efficiently managed distribution channel structure.
It was also discovered that the type and nature of the product determine the intensity of its dissemination. Firms with limited output and markets should, for economic reasons, delegate channel functions to other members. Similarly, Nigerian consumer products manufacturers must use more innovative channel techniques.
E-commerce, or online sales, is becoming a more cost-effective way to service a wider number of clients. Increased acceptance of electronic data exchange to monitor sales and inventory levels across the entire channel is lowering inventories and speeding up reaction to changing customer needs.
The study recommended that manufacturers work to integrate their channel system in order to improve the effectiveness of channel function coordination and eliminate channel conflicts.
Finally, the government should create the necessary infrastructure to ensure the seamless and free movement of products from point of production to point of consumption.
Chapter one
INTRODUCTION
1.1 Background of the Study
The consumer goods sector accounts for a sizable portion of Nigeria’s manufacturing output. According to Adirika, Ebue, and Nnolin (2001), distribution creates demand and satisfaction while also lowering the total cost of marketing organisations.
The consumer products industry, like all other firms, produces goods with low value added. What we observe are processors that convert imported raw materials into final products with minimal value added.
Multinational corporations operating in this business rarely contribute value since they import concentrates from their parent companies and turn them into finished products with little value added.
Wholesalers and distributors dominate the industry. In reality, distributors and wholesalers account for more than half of all industry sales (Lead Capital, July 2009). Their dominance is due to the fragmented nature of the retail market. The retail sector lacked sufficient supermarket and glossary stores.
They are primarily composed of roadside kiosks, businesses, and small-sized restaurants with low sales volumes. Distribution to the retail market is impeded by the large investments necessary for delivery trucks, as well as the overall poor road network. Nigeria’s consumer products market is highly fragmented, including global corporations, as well as domestic and foreign enterprises.
Over the years, distribution channels have been extensively examined in the marketing literature by academics, professionals, and other marketing agents, including manufacturing enterprises and product distribution agencies, particularly in terms of product distribution costs.
Distribution costs may impose a major financial strain on manufacturing enterprises’ earnings, as well as on the economy of a country like Nigeria. Many businesses fail to meet their goals while creating high-quality products because they do not prioritise distribution.
Thus, one may be tempted to ask: what is the economic value of an effective productive activity that fails to provide the physical flow of the complete inventory the attention it requires?
According to Kotler (1986), uncoordinated physical distribution activities can result in excessive costs, affecting the level of service provided by the firm and the profit it can earn. In these circumstances, the gains of business efforts are swallowed up, resulting in a loss or just break-even rather than the intended profit goal.
As a result, in order to completely realise a company’s profit targets and customer pleasure, its distribution channel strategy must be carefully diagnosed, planned, and implemented, as manufacturing is not complete until commodities are in the hands or within reach of the final consumer.
Furthermore, the design and management of effective and efficient distribution channels provide important, often unexplored chances for businesses to gain distinctive long-term strategic benefits. Superior channel performance has emerged as a key means of providing exceptional value to end consumers.
Firms all across the world are increasingly recognising these potential in channel management and adjusting quickly to the drastic changes in channel activity organisation.
According to Uduji and Nnabuko (2011), global marketing channels are becoming increasingly vital for organisations aiming to expand internationally.
Manufacturers establishing items in other nations must decide on the channel structure to use, specifically whether the product should be marketed directly or through foreign intermediaries. They advised marketers that channel arrangements in international markets may differ significantly from those in their native country.
Unfortunately, despite the fact that distribution difficulties have become critical to the success and well-being of enterprises, sectors, and society as a whole, education and research initiatives focused on this “place element” of the marketing mix remain limited.
In light of this, the purpose of this study is to evaluate bakeries’ distribution channels in Port Harcourt, Rivers state, with the goal of establishing more profitable ways for bakeries to reach the market and end customers.
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