EVALUATION OF STRATEGIES USED IN THE DISTRIBUTION OF COCA –COLA PRODUCT
ABSTRACT
An evaluation of strategies used in distribution coco-cola is an important aspect of marketing. Its domain is ensuring the availability of goods and services. So, to find out those problems encountered in ensuring that products get to the right place, at the right, in the right quantities and right condition. The researcher dealt with an evaluation of strategies in distribution and it affect to the management on sale volume and investigation was created on Nigeria bottling company plc, Owerri makers of coca-cola, Fanta, Spirite, Krest, bitter lemon, Eva water. Etc. the rest of the companies’ products will be found in the subsequent chapters In chapter one are introduction, statement of the problem, objective of the study. Scope of the study limitation of the study, significance and definition of terms hypothesis, in chapter two, related literature was reviewed which gave rise to a more balanced approach of the study, the population of the study cantered on the management and staff of N.B.C plc Owerri. The researchers’ data collection and the researcher personal observation. Research question was formulated and analysis in chapter four, with the use of chi-square and percentages. Based on the findings recommendation have made on the solution for correcting the incident of constant break down of sales truck, the emphasis on improvement of N.B.C order processing procedure and effective utilization of the order company’s material handling equipment etc. there is therefore the expression of hope that the implementation of recommendation of products to consumers.
CHAPTER ONE
1.0 INTRODUCTION
1.1 GENERAL REVIEW
An evaluation of strategies used in the distribution in a manufacturing industry a case study of coca-cola product in Owerri, urban, shows that it is topical both in time and place. The reasons are not far fetchered frankly speaking and in the interest of mankind, the image of soft drinks manufactures in the country today has been nothing to be proud of. Their distribution system has been most chaotic. The term marketing has two divergent, but related processes and this should be taken note of. The first of these processes deals with the second deals with the physical distribution of goods. Experience has shown that knowing the increased competition for consumer most entrepreneurs and industrialist as well as their time marketing executives have devoted the bulk of their time not only in the search and stimulation function which emphasize on the physical distribution of goods. With only search and stimulation function in mind their attention was focused on developing that would keep demand high and growing. The have therefore viewed physical distribution or logistics of getting good to the buyers as a supportive and subsidiary activity.
Since users of a product are prepared to spend tome and money searching for such product, the producer has to make sure that the product are actually available to the distribution outlets in order wards there is need fro proper management of product from the manufacturer to the end user who the product are meant for. A typical aim like mineral drinks producer will discover that users of its products are scattered. So the firm will decide ways of moving their products to the users at the right time, right quantity and at the right place. The firm decision to distribution its products directly through their own sales outlets or in directly through intermediaries (such as whole sales and entailers) is not enough to get the product to the ultimate user, the firm has to ensure that adequate care of the product are taken to minimize losses or damage the efficient planning and coordination of physical distribution activities will make goods available at the right time, right quantity and at the right place and also help to firm to achieve, their commercial goals and attainment of these goals falls into the realm of evaluation of strategies in distribution system. An effective customer service is nothing without effectual physical distribution.
According to management expect peter ducker, he define physical distribution as a managerial function which involves the efficient movement of raw materials in process inventory and finished good from source to the point of end use. Customer attraction and satisfaction are highly influenced by the seller’s physical distribution capability as such the issue of physical distribution is important in business. Many people gave different definition as to what physical distribution is the following are numbers of definitions. Physical distribution is the moving of finished products from the end of production line to the ultimate user (American management association Inc 1960. 7) physical distribution consists of all the activities concerned with moving the right amount of right product to the right place at the right time, udoh 2006.
Physical distribution comprises the set of tasks involved planning and implementing the physical flow of material and final goods from point of origin to the point of use to meet the physical distribution in the mineral drink industries should be intensive. They should stock their product in as many outlets as possible. Physical distribution of mineral drinks is very important to gain sales and also compete effectively. Unplanned distribution will result in sub optimization of profit situation. This is because sales will be reduced since the users do not like to take pains in searching fro the products.
Furthermore evaluation of strategies used in the distribution can read to wide variations and frequent changes in price situation which discourage brand loyalty. This will result to loss of customer and as such will bring about low sale. So physical distribution of mineral drinks should be coordinated properly to coco-cola products is chose to study of evolution of strategy used in physical distribution because it is acknowledged as the leader of mineral drink since it have the largest sales share in the relevant product.
1.2 SATEMENT OF THE PROBLEM
In Nigeria bottling company, physical distribution is a very important aspect of distribution activity as it sets the stage for possession and little utilities all geareal towards customer satisfaction faced on this therefore, there is need for a careful handling of physical distribution function fro a successful operation of soft drink industry. However for NBC physical distribution system to be least near perfection. It must rate highly in its core activities such as transportation warehousing, inventory management, order processing and also have ability to organise this mix of activities properly and implement efficiently and effectively. But is this so are the sales men ordinary raise the cost of the bottled drinks sold to intermediary markets therefore, reducing their margin does the degree of the wholesales margin effect the final consumers? Do customers get enough of the products at the right time? Do the sales men direct some product already allocated to the company’s customers? Does the distribution of mineral drink have a direct relationship with that sales turnover it makes? A negative response of any of those questions will indicate that there is derivation from what should normally obtain. The desire to find out, if any of such problems exist their cause affects and what may be done to resolve such problem are the reasons from undertaking this research work
• Nigeria Bottling Company NBC obtain a high cost of transportation
• Criticisms of the company distribution policy
• Inadequate transportation and storage facilities
• Ineffective distribution towards customer satisfaction
1.3 OBJECTIVE OF THE STUDY
In consonance with their macro objective to determine the effectiveness of physical distribution of coco-cola products in Owerri urban. This research has some objectives they are. To study the physical distribution activities of the coco-cola in Owerri urban and try to find out 19 these activities of these activities are performed as expected.
• Analyse the present physical distribution system with the aim to assess its level of efficiency.
• To determine the nature of the market
• To determine the extent to which the distribution of coco-cola relates with the sale being made
• To find out the type of strategy that will be suitable in supply of coco-cola product to their customers.
1.4 RESEARCH QUESTION
The research question for his work based on the following.
• That are some the problem encountered in the physical distribution of coco-cola product within urban.
• What type of strategy structure best for distribution of final product?
• What type of strategy or channel do you use when supply of finished product and the type of transportation model necessary for physical distribution of coco-cola product?
• Who initiate and in what circumstance can the exercise be carried out.
• How does the physical distribution contribute in the over all growth and effectiveness of the entire operation of the company.
• Who controls the stores unit? To whom does the report go to after distribution (returns).
1.5 THE SIGNIFICANCE OF THE STUDY
The relevant of significance of physical distribution is traceable to growing uncertainties in the world market for materials. These days methods must improved because today’s recipe for success can be tomorrows recipe fro failure. This also correlates a need to keep abreast with economic growth and political instability in world market as to avert product shortage to idle time and price inflation. Another dimension is that distribution decision is taken on promises of rapid technology update which impact and contributes to the complete of distribution objective. The benefit of this work to Nigerian bottling company Owerri includes the following.
• The need to apply distribution strategy in all distribution activities around to company.
• To under stand that distribution strategy helps to determine good and effective supplies
• Other companies will learn to emulate the application of strategy base on distribution activities
• Through this work, student of purchasing supply department will know and understand the impact of physical distribution in the achievement of distribution objectives.
1.6 RESEARCH QUESTION
The research question for this work based on the following.
• What are some of the problem encountered in the physical distribution of coco-cola product within Owerri urban.
• What type of strategy or channel do you use when supply of finished product and the type of transportation model necessary for physical distribution of coco-cola product?
• Who initiate and in what circumstance can the exercise be carried out.
• What type of strategy structure best for distribution of final product?
• How does the physical distribution contribute in the over all growth and effectiveness of the entire operation of the company.
1.7 HYPOTHESIS OF THE STUDY
The following research hypothesis will be tested.
1. H0: There is no effective distribution of soft drink products to customers
Hi: There is effective distribution of staff drink product customer and consumers
2. H0: Transportation cost is not a limiting factor in distribution of soft drink
Hi: Transportation cost is a limiting factor in the distribution of soft drinks.
3. H0: Conflict between retailers and distributors has no effect on distribution Channel or system in soft drink industry.
Hi: Conflict between relailer and distribution has effect on distribution channel or system in soft drink industry.
1.8 SCOPE OF THE STUDY
The scope of this research work conducted in Owerri urban which is divided into five groups A,B,C,D,E find out the present physical distribution system of company’s products For further clarification the groups are made up of the following:
Group A – Amahum
Group B - Umuoyima
Group C – Umuodi
Group D – Umuororoju
Group E – Umuayache
1.9 LIMITATION OF THE STUDY
This work which is at an evaluation of strategies used in distribution system of the coca-cola plc, is a study based purely on the company. It therefore behoves on the researcher to restrict herself on this particular industry, but not within the knowledge of their various distribution and consumer scattered all over it geographical areas of sales in the eastern zone. Owing to very limited time, the present economic situation and finance available fro this study, the researcher or writer instead of travelling to all the distribution sought information from some of the distribution who came from where the researcher would have travelled to the plant at the time I went there to collect data relevant fro this research. To a large extent, bureaucracy or official protocol was a hindrance to the elicitation of vital information for instance, the question of the marketing department giving me their list of distribution met with such fate. My interview with so many official were intermittently disrupted by occasional callers to the plant or factory; these were among the problem the researcher encountered in the course of this research work. In effect, these difficulties encountered necessitated the researcher to solely depend on answer obtained manger of the plant.
1.10 DEFINITION OF TERMS
• Transformation: the movement of goods from the point of production to the selling point.
• Storing: the supplying function of holding goods, it provides time utility.
• Inventory: the amount of good being stored.
• Physical Distribution: the transportation and sorting of goods.
• Warehousing: a place for loading and unloading of goods both in the central store and the depots of empties and bottled products.
• Communication: the process by which information is passed by a previously accepted symbols.
• Inter Modal: this sis competition which exist between several providers of services with a particular mode of transport.
• Freight: term applied top goods being transported and also the charge made to transporting him.
• Per Shipment: inspection of goods are classified according to types and their rates or duty.
• Shipping Brokers: shopping as their name implied are intermediaries who deal in space fro the transaction of material. Paid on a commission basic and located in major shipping coasters, they can achieve most of the concerns in contain and distribution for specific transport carried.
