BAD ROAD NETWORK AND ITS EFFECT ON LOGISTIC AND SUPPLY SYSTEM ON SMALL AND MEDIUM ENTERPRISES

CHAPTER ONE

INTRODUCTION

1. BACKGROUND OF THE STUDY

One of the key factors that play a pivotal role in a region’s economic growth is the presence of a reliable and efficient transportation system, this is mainly due to the fact that a well developed transportation system provides adequate access to the region which in turn is a necessary condition for the efficient operation of manufacturing, retail, labour and housing markets. Transportation is a critical factor in the economic growth and development. It is a wealth creating industry on its own inadequate transportation limits a nation’s ability to utilize its natural resources, distributes foods and other finished goods; integrate the manufacturing and agriculture sectors and supply education, medical and other infrastructural facilities. There is the need therefore to maintain and improve the existing transportation and build new infrastructures for a national wealth. The national wealth is the growth domestic products (GDP) which is an indicator or measures of the rate of economic growth. Transportation infrastructure is critical to sustain economic growth because people want to improve their standard of living and they see increased income as the way to achieve that goal, transportation system enhancement are in turns a means of maintaining or improving economic opportunities, quality of life and ultimately income for people in a particular region Lucas (1998).

Transportation also has a broader role in shaping development and the environment. Policy concerns in the next millennium will increasingly focus on the effects of transportation on where people live and on where businesses locate; and on the effects that these location decisions have on land use patterns, congestion of urban transportation systems, use of natural resources, air and water quality, and the overall quality of life Issues of urban sprawl, farmland preservation, and air and water quality have already pushed their way to the forefront of policy debates at both the national and local levels. To make prudent decisions, policy makers must be equipped with the best information and analysis possible about the interactions among these various factors. Transportation becomes the back bone of any economy, especially countries like Nigeria, as such an anatomy of aspects relating to inefficiencies and lack of good transportation network in Nigeria coupled with low rate of economic growth (GDP) is crucial, attached to this is the poor government policy on transportation (Lack pf regulation of fees charged by private transporters, inadequate fuel. Lack of spare parts and above all the prevalence of bad roads and lack of security have succeeded in trimming down the transport system in Nigeria which have a negative effect on the economic growth. Investment in transportation infrastructure is critical to sustained economic growth. Mobility studies show that transportation is absolutely essential to economic productivity and remains competitive in the global economy. An international study found every 10 percent increase in travel speed; labour market expands 15 percent and productivity by 3 percent (Barrister and Berechinan. 2014). Transportation is indispensable to economic growth and development of human settlement (Pisarski, 2013; Small, 2006; Gbadamosi, 2010). A key component in addressing poverty and social equity goals while ensuring adequate access to public service is nothing but transportation. Majoring, education, health care, markets, jobs, and recreation – that are essential to the lives of all persons (Rittner& Kirk, 2014; Sanchez, 2014; Mbara, 2015; Bullard, 2014). The vital and important aspect of developing in a nation, contributive, is transportation. Among the core human needs as stated by Abraham Harold Maslow’s hierarchy of requirements as identified below – the writer cogitates transportation is one very most compelling basic need – in fulfilling a human need.

1. Self-actualization: Pursue, inner talent, creativity, fulfilment

2. Self-esteem: Achievement of respect and recognition, confidence among others.

3. Level of belonging: Friendship, family, love

4. Safety: Security, stability, freedom from fear, health

5. Physiological: Food, water, shelter, sex

According to (Rittner& Kirk, 2014; Sanchez, 2014; Mbara, 2015; Bullard, 2014), one can systematically be tempted to say transportation is a compelling character in personal satisfaction – security, food, health – and the conformability of free and fast movement from one location to another. Brainstorming on the intellectual, economic definition of transportation according to (Pisarski, 2013; Small, 2006; Gbadamosi, 2010) – the writer opines that “transportation is the basis of human needs, and with, through transportation the needs identified by Abraham Maslow can be obtained.” The view of the writer is subjective to any other critics’ or opinion. The developments of most developed nations are built around the transportation industry. It indeed forms a very central role in the development; this is because nothing can be down without transportation. For example: finish goods and services from the company cannot get to the final destination (the customer and or consumer) without transportation. Likewise, a farm product (raw material) cannot get to the factory for processing without transport. Governance, service team, cannot move from one part of the country to the other for valuable monitory services without transportation. More so, a country is insecure without a transportation means for its security servicemen. Transportation ineffective is the basis for the fulfilment of countries need, individual needs, and company’s needs and hence form the primary need for development at large. Business-wide, not compromising communication, transportation is not just the primary element but delicate entity to be deliberated on in the supply chain. Consequently, it can make and unmake the growth of business. The dominant flow in an efficient supply chain of a company is nothing but transportation.

1.2 STATEMENT OF THE PROBLEM

Construction of roads increased substantially with the opening up of residential precincts that also benefitted from increasing demand for lettable spaces in commercial properties. Many private companies, retail stores, commercial banks aggregate in the metropolis to take advantage of opportunities afforded by locations near the seat of governance thus attracting complimentary services. This led to high concentration of vehicular and pedestrian movements especially along the access roads. The roads exhibit a number of nodes and linkages to form networks of both arterial and minor routes along which commercial properties locate. Accessibility within the road network is affected by the compact nature of various routes that sometimes impede volume of traffic. The road network is made up of nodal points and links that determine the degree of connectivity and accessibility in the network. A number of factors affect values of properties. These factors may be intrinsic or extrinsic. The extrinsic factors include increase in demand for lettable space, location, condition of adjoining properties, nearness to park and leisure, local and national economic conditions. External factors are due to natural characteristics of the property which affect the city where the property is located. Intrinsic factors arise from within the nature of the property itself and relate to the physical attributes, including size of room, state of repair, decoration, and facilities. Other attributes that increase or decrease the amount that users are willing and able to pay in an open market transaction include physical characteristics of the structure, change in taste and demand, effect of adjacent activities, economic activities, inflation, and changes in legislation. The demand for commercial properties itself is affected by changes in population, planning and development schemes, legislation, and availability of good road networks. Many previous studies emphasized the effects of the factors on values of properties generally with little consideration given to road network pattern and its effects on logistics and supply. Possible relationships between road networks, location attribute, demand and supply, and accessibility and commercial property values have therefore elicited the interest of the researcher in this direction.

1.3. AIMS AND OBJECTIVES OF THE STUDY

The major aim of the study is to evaluate bad road network and its effect on logistic and supply system in Nigeria. Other specific objectives are as follows;

1. To examine the possible causes of bad road network.
2. To examine the influence of road network growth on economic development.
3. To examine the effect of bad road network on logistic and supply system in Nigeria.
4. To examine the situation of bad road network in Nigeria.
5. To examine the relationship between bad road network and logistic and supply system in Nigeria.
6. To suggest possible Solution to solve the problem of congestion.

1.4. RESEARCH QUESTIONS

1. What are the possible causes of bad road network?
2. What are the influences of road network growth on economic development?
3. What are the effects of bad road network on logistic and supply system in Nigeria?
4. What is the situation of bad road network in Nigeria?
5. What is the relationship between bad road network and logistic and supply system in Nigeria?
6. What are the suggested possible solutions to solve the problem of congestion on Nigerian roads?

1.5. RESEARCH HYPOTHESES

H₀₁: There is no effect of bad road network on logistic and supply system in Nigeria.

H₀₂: There is no significant relationship between bad road network and logistic and supply system in Nigeria.

1.6. SIGNIFICANCE OF THE STUDY

There is therefore the need to examine the linkage between bad road network and its effect on logistic and supply system, particularly Nigeria in order to help policy makers formulate policies that will favour the transport sector to enhance growth of economy. To the people, this study will enlighten them more on the important of having a better road network system; To students and researchers, this study reveal the current situation in the sector by adding to the work done by other researcher so as to provide base for future research; To the policy maker this study will reveal the state of transport infrastructure across the country making them known that more funds and implementation of policy already made is needed critically to be in place in the sector.

1.7. SCOPE OF THE STUDY

The study is restricted to Local government financing and accountability in Nigeria: case study of Osisioma Ngwa L.G.A, Abia state

1.8 LIMITATION OF STUDY

Financial constraint– Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint– The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.8 DEFINITION OF TERMS

Road: A road is a thoroughfare, route, or way on land between two places that has been paved or otherwise improved to allow travel by foot or some form of conveyance, including a motor vehicle, cart, bicycle, or horse.

Road Network: The road network is the system of interconnected roads designed to accommodate wheeled road going vehicles and pedestrian traffic.

Logistic: Logistics typically refers to activities that occur within the boundaries of a single organization. Logistics is about getting the right product, to the right customer, in the right quantity, in the right condition, at the right place, at the right time, and at the right cost (the 7 Rs).

Supply: Supply Chain refers to networks of companies that work together and coordinate their actions to deliver a product to market.