TRANSPORTATION COST AND PRICES OF GOODS AND SERVICES IN NIGERIA
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TRANSPORTATION COST AND PRICES OF GOODS AND SERVICES IN NIGERIA
Abstract
This study looked at transit costs and the prices of products and services in Nigeria. The study’s overall population is 200 retailers, with Uyo as the main market. The researcher employed questionnaires to collect data.
Descriptive A survey research design was used for this investigation. The survey used 133 respondents made up of males, women, buyers, and drivers. The acquired data was organised into tables and analysed using simple percentages and frequencies.
Chapter one
Introduction
Background of the study.
As life began, humans developed a need for fundamental necessities such as food, shelter, and protection.
At first, man attempted to offer the required goods to satisfy his requirements by engaging in hunting, gathering some selected plants for food, finding shelter amid tree shades, and using plant leaves to cover his nakedness.
Man discovered that he could not meet all of his own requirements as he advanced. Then the exchange process began. This began as an exchange of products for goods, often known as trade by barter.
The guy who has more of a certain product than he requires at the time will look for someone who needs his excess. Produce while also having the produce he lacks, allowing for a deal.
As a result, the earliest trade or buying and selling operations were conducted on a retail level using the barter mechanism.
When a common medium of exchange was inverted on a monthly basis, barter trade practices were less relevant in the exchange process. When bartering was popular, buyers and sellers did not consider the cost
and effort of transporting products in search of a market. As money became a form of payment, the function of transporting marketable commodities to the market was compensated for.
Every commodity’s price must be determined using money as the standard of measurement. When determining expenses for this firm, the seller must include the cost of transporting the product from the site of production to the point of consumption.
In ancient times, man relied mostly on beasts of burden to transport his things from the site of production to the place of consumption; nevertheless, transportation has evolved to become more complex, convenient, and speedier.
Some modes of transit include railway transport, motor vehicles on the road, ships, boats, canoes paddling across water, and aeroplanes soaring through the air.
The mode of transportation used will be determined by the nature of the order’s production items, as well as the location and type of market. (Onyebunagu, 1995).
Transportation is engaged at every stage of production and distribution, until the product reaches the end customer.
The industrial revolution occurred, resulting in an increase in productive capacity.
Most producers and sellers aim to take advantage of the economic benefits of large-scale manufacturing and distribution. They also want to enter major markets and operate at a competitive level.
They must manage costs and processes in order to operate effectively and remain afloat. In Nigeria, distribution expenses, particularly transportation costs, are sometimes seen as one of the reasons contributing to rising commodity prices.
This study, “the impact of transportation cost and prices of goods and services in Nigeria,” will investigate whether cost of transportation is a significant proportion of the price of consumer meals in Nigeria.
STATEMENT OF PROBLEM
For many years, the prices of consumer items in Nigeria have steadily increased. These price rises are said to be the result of rising costs for raw materials, transportation, rent, capital, and labour. Among these variables, this study will attempt to evaluate the degree to which the cost of transportation impacts the process of consumer products.
Specifically, this study aims to discover the following:
Consumers claim that rising prices reflect vendors’ profit-seeking behaviour. On their own side, the vendor blames price increases on rising input material costs and facilitating agents. The challenge now is to determine which of the price-increase allegations is correct.
According to reports, rising prices have made it difficult for many families to obtain their three basic meals on a daily basis. The government, labour, and consumerists have expressed concern and attempted to curb the price increase without making any significant progress.
GOALS OF THE STUDY
The study’s aims are:
To determine how transportation costs affect consumer products prices.
To determine whether retailers’ desire for excessive profits influences their decision to fix product pricing.
To determine what can be done to relieve the challenges caused by market price increases for consumer goods.
Research Hypotheses
To ensure the study’s success, the researcher developed the following research hypotheses:
H0: Transportation costs have no effect on consumer product prices.
H1: Transportation costs affect the prices of consumer items.
H02: Something can be done to address the concerns of rising consumer goods prices in the market.
H2: Nothing can be done to ameliorate the concerns of rising consumer goods prices on the market.
Significance of the Study
This study will be useful for economic analysts who want to trace the causes of inflation to their true sources.
It will be quite useful to marketing and management professionals who are looking for effective answers to some of their marketing difficulties.
It will be a useful source of information for academics conducting study on retail pricing. It will also be important information for the government’s regulatory policies on price control and transportation.
It will be a useful tool for business owners in the distribution industry since it will teach them how to reduce costs and set competitive prices.
Scope and Limitations of the Study
The study’s scope includes the cost of transportation as well as the pricing of goods and services in Nigeria. The researcher faces various constraints that limit the scope of the investigation;
a) AVAILABILITY OF RESEARCH MATERIAL: The researcher has insufficient research material, which limits the investigation.
b) TIME: The study’s time frame does not allow for broader coverage because the researcher must balance other academic activities and examinations with the study.
Operational definitions of terms
Transportation cost. The costs associated with transferring items or assets to a different location, which are frequently passed on to customers. For example, a business would normally incur a transportation expense if it needs to convey its products to merchants so that they can be offered for sale to consumers.
PRICE: A price is the amount of money or compensation paid by one party to another in exchange for a unit of goods or services. Production costs and product demand both have an impact on pricing. A price can be set by a monopolist or imposed on a corporation by market conditions.
GOODS AND SERVICES: Goods are tangible commodities like pens, salt, apples, and hats. Services are activities offered by other people, such as doctors, lawn care workers, dentists, barbers, waiters, or online servers, a book, a digital videogame, or a digital film.
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