The Impact Of Effective Distribution System In An Organization (A Study Of Pz Cussons Nigeria Plc, Sokoto)

Background to the Study
One  of  the  important  aspects  of  the  production  of  goods  and  services  is  the  proper distribution of the same in such a manner that it will reach the target consumers in the most cost-effective and expeditious manner.  Marketing is an organizational function and a set of processes for creating, delivering and communicating value to customers, and customer relationship management that also benefits the organization. Marketing is the science of choosing  target  markets  through  market  analysis  and  market  segmentation,  as  well  as understanding consumer behavior and providing superior customer value. From a societal point  of  view,  marketing  is  the  link  between  a  society's  material  requirements  and  its economic    patterns  of  response.  Marketing  satisfies  these  needs  and  wants  through exchange  processes  and  building  long  term  relationships.Marketing  activities  have contributed greatly to the creation of affluent society. 

The  exact distribution mix that  a  company  will  select  depends  the  analysis  of  the environment in which it is operating, the analysis of the target consumers, and the type of resources  at  its  disposal.  Manufacturers  and  producers  depend  on  the  availability  of products to those who wish to purchase them in order for the products to move off the shelves and for the company to make profits, which shows the importance of selecting the right distribution mix.  For  example,  an  orange  juice  producer  must  select  the  most effective distribution mix to  ensure  that  its  products  get  to  the  right  places  from  where customers can purchase them, a factor that is made more urgent by the short shelf life of such products. 

Kaci Lane Hindman (2013), one of the factors that will be considered when coming up with the right distribution mix is the nature of the product to be distributed. For instance, in the  case  of  a  product  with  a  limited  shelf  life,  such  as  the  orange  juice, the distribution mix must enable a swift transfer of the products from the production plants to the warehouse and to the eventual retailers for purchase by final consumers. In the same sense,  a  product  with  a  longer  shelf  life  might  benefit  from  the  application  of  a different distribution mix. When considering the effect of the environment on the selection of  the  proper distribution mix,  a  lot  of  factors  come  into  play,  such  as  the  state  of  the transportation infrastructure in place in the environment, since this can lead to different outcomes for the same product in different environments. 

For instance, a company that is located in an area with good infrastructural framework in terms  of  good  roads  and  reliable  transportation  schedules  will  adopt  a different distribution mix that  it  will  use  in  another  country  with  a  poor  infrastructural framework.  As  such,  if  the  orange  juice  company  is  located  in  a  country  with  good infrastructure,  it  might  use  a  combination  of  trucks,  inventory and differently  packaged products to distribute the finished product. If the same company is located in a country with poor roads and unreliable electricity supply, it might slightly modify the product in order to extend the shelf life, since the poor state of the roads means it cannot expect the same expeditious and reliable delivery routines that it enjoys in more developed regions.

Kotler  (2000),  says  that  Place  as  one  of  the  marketing  mix  elements  is  simply  getting goods to the right place at the right time in the right quality. Place is the fourth “P” which has its traditional marketing term as distribution. Product distribution (or place) is one of the four elements of the marketing mix. Distribution is the process of making a product or service  available  for  use  or  consumption  by  a  consumer  or  business  user,  using  direct means, or using indirect means with intermediaries. The  distribution  mix  is  all  those  functions  marketers  perform  to  move  goods  from producers to consumers. These intermediate consumers are wholesalers and retailers. They are  known  as  marketing  middlemen  because  they  are  in  the  middle  of  a  distribution network that connects producers with consumers (Nwokoye, 1980).

Clifford  (1992)  opines  that  management  needs  to  search  for  distribution  economics  in inventory  control,  warehouse  location  and  transportation  modes.  One  problem  is  that distribution efficiently declines when the company did not meet with delivery date.This leads customers to “bad-mouth” the company eventually sales fall. Management responds by increasing sales force incentives to secure more orders. The sales force succeeds but once again the company slips in meeting delivery dates. Management needs to identify the real bottleneck and invest in more production and distribution capacity.

Physical  distribution  is  an  integrated  set  of  activities  that  deal  with  managing  the movement of goods within firms and through marketing channels (Kotler, 1980). Planning an effective physical distribution system can be significant decision point in developing an overall marketing strategy. A company who places the right goods in the right places at the right time, in the right quantity, and with the right support service, is able to sell more than competitors who fail to observe or accomplish some goals.

Physical distribution is of great importance to  most firms because it accounts for about 19% - 22% of the retail price. Part of these cost go for movement of products and the remaining part  is  related to  inventory holding.  Although physical distribution  cost vary from  industry  to  industry. With  the  above  importance  and  many  others  prompted  the researcher  to  verify  more  on  the  effectiveness  of  distribution  in  an organization  and suggest other possible ways of distribution in an organization.

TABLE OF CONTENTS

Title Page.............................................................................................................i

Approved Page....................................................................................................ii

Dedication...........................................................................................................iii

Acknowledgment................................................................................................iv

Table of Contents................................................................................................vi

CHAPTER ONE: GENERAL INTRODUCTION

1.0 Introduction..............................................................................................1

1.1 Background to the study.........................................................................4

1.2 Statement of the Problems...................................................................... 5

1.3 Statement of Hypothesis............................................................................5

1.4 Significant of the Study.............................................................................6

1.5 Scope and Limitation of the Study.............................................................7

CHAPTER TWO: LITERATURE REVIEW

2.1 Introduction..............................................................................................8

2.1.1 Concept of Distribution and its Nature.....................................................8

2.2.1 Physical Distribution................................................................................10

2.2.2 Objective of Physical Distribution............................................................11

2.2.3 Importance of Physical Distribution.........................................................13

2.2.4 Problems of Physical Distribution.............................................................14

2.2.5 Solution to Problems of Physical Distribution...........................................16

 3 Relationship of Marketing Sales to Distribution........................................17

2.4 Relationship of Transportation and Ware-Housing to Distribution.............18

2.5 Retailing.......................................................................................................21

2.6 Channel Flow of Distribution......................................................................23

2.7 Types of Channel.........................................................................................24

2.8 Main Channel of Distribution.....................................................................26

CHAPTER THREE: RESEARCH METHODOLOGY

3.0 Introduction................................................................................................27

3.1 Research Methodology................................................................................27

3.2 Method of data collection...........................................................................28

3.3 Sources of Data Collection.......................................................................28

3.3.1 Primary Source........................................................................................28

3.3.2 Secondary Sources..................................................................................29

3.4 Method of data Analysis..........................................................................29

3.5 Method of Investigation............................................................................29

3.6 Sample and Sampling techniques............................................................30

3.7 Questionnaire Design and Collection......................................................30

CHAPTER FOUR : RESEARCH METHODOLOGY

4.0 Introduction............................................................................................31

4.1 Data Presentation and Analysis .............................................................31

4.2 Testing of Hypothesis.............................................................................36

4.3 Research Findings.................................................................................42

CHAPTER FIVE: SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

5.0 Introduction..............................................................................................44

5.1 Summary.................................................................................................44

5.2 Conclusions..............................................................................................44

5.3 Recommendations....................................................................................45

Bibliography...................................................................................46

Appendix........................................................................................47