ANALYSIS OF MARKETING DISTRIBUTION STRATEGY OF SOME NIGERIAN COMPANIES
ABSTRACT
The analysis of marketing distribution strategies of some Nigerian companies with case study of nestle Nigeria plc is the subject matter of this study. Some related literature were revived like, distribution strategies, service need of the target market, how to determine the target market, how to determine the appropriate channel distribution objectives determine alternative strategies and determine the appropriate channel structure. Nestle Nigeria plc has the staff population of 500 which include the marketing department, accountancy department etc, but marketing department is used as the sample consumer which has the population of 100. The consumer population of nestle is 5000 which was determined by Yaroyamen and had the sample size of 270. Therefore 370 questionnaires were distributed and 345 were returned. Data were presented and interpreted using percentage table and chi-square were used in testing the hypothesis. Base on the finding it was seen that Nestle Nigeria Plc observed defects in the current distribution will enable Nestle Nigeria Plc achieve distribution strategies will enable Nestle Nigeria Plc achieve better customer serves.
CHAPTER ONE
INTRODUCTION
1.0 BACKGROUND OF THE STUDY
There is this notion that production is incomplete until the products get to the final consumer. Hence, no matter what firms do on other three marketing strategies (the three p’s) nothing happens until the goods and services are distributed. Distribution is one of the major areas of marketing mix that concerned with the movement of goods and services from point of production to the point of consumption. There are several definitions of distribution by different authors or marketing experts. Thus:
According to Onuoha J. K. (2004:92) distribution is defined as the flow of title to goods and services as they move along the channel of distribution from point of production to the point of consumption. It ensures that produced goods and services are made available to the consumers in their most economic manner.
Kotler and Anstrong (2004) defined distribution as the planning, implementing and controlling of the physical flow of raw materials, final goods and services and related information from point of origin to point of consumption to meet customers requirements at a profit. Goods and services are delivered to the right customers, at the right place, at the right time and at the right price.
Distribution aims at gathering goods and services to reach the consumers through intermediaries. It involves not only physical movement and handling of products, but the transfer of ownership as well. By the use of intermediaries or channel of distribution, the goods produced will get to the consumers.
The term channel of distribution is seen as all the institution or individuals that assist in exchanging goods and services as they move from one point to the other. Apart from physical transfer of goods, it entails the transfer of title to products from one point to another. The channel of distribution is sequentially arranged in such a way that it achieves set objectives. Such as producer – consumer – producer – retailer, consumer etc for consumer goods, while industrial is producer – industrial user, producer – industrial distributor – industrial user.
This research work deals with the analysis of marketing distribution strategies of some Nigerian companies. Nestle food company is a company that was established in Chine in 1990 where they produce powered milk and infant formula. They manufacture their products in more than 60 countries of the world. The manufacturing system of Nestle safeguards, sustains multifarious source, plant and planning parameters for the same item generated at various locations. The manufacturing system preserves to generate a complete picture of manufacturing operation. This involves monitoring products and element from raw materials through the finished goods stage.
Nestle food company is located in Lagos where out some of activities or functions. Nestle has diversified from the traditional food related products, such as fairly products, break fast related products, such as fairly products, breakfast cereals or chocolate and ice cream and nutritional solution as well as beverages and bottle water. Nestle, one of the oldest of all multinationals companies has grown from a two products company focusing on infant nutrition to one of the largest food companies worldwide.
Nestle company in other to carryout their activities and operations effectively and efficiently for the purpose of achieving its objective, they make use of different distribution strategies in order to ensure that produced goods and services are made available to its consumers.
The analysis of distribution strategies it existence in nestle company in 1990 when the company was established and stated its operation. This is because when the product were produced, the make use of different distribution strategies such as selective exclusive, and intensive distribution strategies. This strategist helps the company to distribute the products to their customers worldwide.
Nestle food company produces mainly convenience goods such as beverages etc. since it is producing convince it employ the use of intensive distribution strategies thereby using all available out let in distributing their product world wide.
In some conditions nestle food company go into the production of shopping product and used selective distribution strategist in distributing its shopping product thereby making use of one or more outlet but less than unavailable that are willing to carry their products.
Nestle food company make use of exclusive distribution strategies occasionally and only when the produce spatiality product thereby using one or fill number of intermediaries in the distribution of its product in a defined vicinity the company all so make use of certain sales promotion such as consumer promotion trade promotion and sales force promotion which is very essential in the company sales effort to current and potential customers both in rural and Urban areas.
This sale promotion is used to generate quick response to the service provided by the marketers in distributing some of the companies product services like buy ten cartons of peak milk and get a free DVD player or buy five plates of ice cream is an example of alluring sales promotion massage. Although sales promotion is a form of short term incentive design to generate immediate product purchasing from the customers, it is expected to push sales above it present position. In the selection of distribution channel nestle considers some certain factors such as market characteristics product characteristics company characteristics, environmental characteristics, middle men.
1.2 STATEMENT OF THE PROBLEM
According to milk muller and war on ant, a London based activist group concerned with problems of the third world (AKHTER 1994) says that nestle baby formulae controversy had a publication of a pamphlet called the baby Killer in 1974. the pamphlet claimed that third world babies where were dying because their mothers wee feeding them with infant formula that was been marketed by multinationals such as Nestle of Switzerland and united kingdom cow and gate. The aftermath of the publication led to international crises of nestle.
Since the business environment is very complex in nature the average manufactures is becoming more conscious and are therefore forced by competitors to be aware of the increasing prices inadequate distribution planning of the need in analyzing marketing distribution of an acknowledgement of its prospect.
Distribution system is another problem of nestle food company because the hiring of trucks and maintenance distribution outlet this gives a lot of concern to the marketer and formed is required for effectives management. In most cases distribution personnel have little or no knowledge of strategies to embark upon at any time and also do not monitor the circulation of their product in the rural area. As a result this, they concentrate more in the urban areas not minding they competitive activities of their rivals. Poor training of middlemen this is also a problem to nestle company because when the middlemen are not properly educated about the product, they can not be able to convince their customers to buy their products.
1.3 PURPOSE AND OBJECTIVE OF THE STUDY
The purpose of this study is to generally analyze the distribution strategies of nestle food company with a view to identifying defects in the current distribution strategies and recommending the most appropriate distribution strategies that would enabled the company achieve its marketing objective.
The other specific objective are follows:
1) To appraise the current distribution stagiest of nestle food company.
2) To identify the defect in the current distribution of nestle Nigerian plc.
3) To established the relationship between effective distribution strategies of nestle Nigerian plc and achievement of its marketing objective.
4) To also established how effective distribution strategies will enable nestle achieve better customer services
5) To recommend the appropriate distribution strategies that would enable nestle Nigerian plc achieve its marketing objective.
