IMPROVING DISTRIBUTION EFFECTIVENESS IN MARKETING OPERATION

CHAPTER ONE

1. INTRODUCTION:

The recent phenomenon in the marketing environment in Nigeria has resulted in a drastic turn around from a production oriented market to a buyer oriented market.  It has demonstrated the importance of recognizing a remarkable change in buyer behaviour, and the need of every production company to reappraise its marketing system and adapt to the new environment and even exploit it.  A key strategy in this marketing system is DISTRIBUTION.

Distribution is a strategies marketing tool representing one of the four arms of the marketing mix, often referred to as “4Ps”.

These 4P’s are:

PRICE:  This measures the ability of the buyer to purchase the products.

PRODUCT:         (quality and quantity):  this includes all the attributes to make the product attractive for exchange purpose.

PROMOTION:   Promotion involves creating awareness about the product, educating the potential and actual consumers about the product, and at purchasing the product or even reducing dissonance.

PLACE:  (Distribution) the core of the matter being distribution is very important because the efforts developing the product, creating awareness and the product, creating awareness and putting or displaying the product at the best price will be defeated if it is not made available at the place that exchange can take place.

The marketing mix thus comprises the decision element in company’s marketing programme, the total packages that determine the degree of marketing concept.

The “4P’s” summarises clearly the major ways the firms can influence sales.  We are concerned with the place variable.

This therefore, pinpoints the importance of distribution in achieving available products.  This availability of product bridges the gap of space and time between the production and consumption.

Before a production could achieve the desired satisfaction, it must get to the consumers the way they want it, thus breaking all the barriers or gap between the production areas to the consumers.

Schare and Smith 1980 (page 386) saw the desired satisfaction, it must get to the need for effective distribution when they remarked that the most innovation product at an attractive price is worth absolutely nothing if it is not available to the buyers when they want it.  Product availability then is one requirement of an exchange.

Therefore, marketing managers all around the world appreciates the role the distribution play in providing place, utility or satisfaction to the product is available, the value is therefore enhanced.  So distribution can be seen to increase the time of utility of a product by putting down the distance between the parties to the exchange.

Nigeria Bottling Company Plc (NBC) practices the traditional distribution system that is their products are distributed through various types of middlemen like wholesalers, retailers to customers, direct from the company or through the salesmen.

According to Martin Rom. J. (1997 page 316) “The channel of distribution therefore in its most meaningful and simple firm is the course of title boy commodity”.   These routes include both the manufacturers and ultimate consumers as well as anyone in between.

1.1     GENERAL BACKGROUND OF THE SUBJECT MATTER:

Nigeria Bottling Company Plc, Coca-cola is the world’s leading soft drink sold across the globe.  A total of 600 million servicings are consumed everyday in all parts of the globe from Canada in the North to Argentina and New Zealand in the South, from Alaska to China Maxico to Nigeria.  In 1983, when Nigerian Bottling Company first set up its first plan in Lagos (Apapa), it was to be the beginning of an exciting story of growing and development particularly during the past 45 years.

Nigerian Bottling Company Plc is today Nigeria number one bottle of soft drinking.  Selling more than 7,2264, 138 bottle per day representing 302,073 crates of 24 bottles daily throughout the Federation.

Coca-Cola was first made on 18th May, 1886 in Atlanta Georgia, U.S.A.  Which is the home town and now the world Headquarters by Dr. John Stythpembenton, a pharmacist. 

The name Coca-cola was named or given by Frankin Robinson, Pembetons Partner and book keeper.

HOW IS COCA-COLA MADE

The first thing is to select the bottles and dispose those with effects.  Quality is the key word which determines the success of whole operations only the best ingredients re used for and filling making the soft drink, and sophisticated washing and filling equipment has been installed in all plants.

The manufacturing process is based on a careful measures combination of sugar, water concentrate with standard maintained throughout the world.  Pure refined sugar added in pure drinkable and treated water is produced as solution called “Simp Syrup”.  The syrup is passed through a filter to ensure purity where it was mixed with undiluted concentrated carbondioxide (Co2), at this step product is measured into the bottles mechanically.

Products of NBC Plc include:

Coca-cola

Sprite

Fanta Orange

Soda

Chapman Krest

Ginger Ale

Bitter Lemon

Fanta Tonic and

Eva table water.

Nigeria

Nigerian Bottling Company Plc has three modes of distribution:

(a)     Through their open office store

(b)     Open sales (selling to the public through their wholesalers).

(c)      Through their 1168 sales trucks flects of an average cases capacity of the retailers.

1. 1. PROBLEMS ASSOCIATED WITH THE SUBJECT MATTER

Consumers can be attracted by the quality of a product or promotion for the product and vice of the product, their final decision as to the fitness of the offer is to as large extent influence by the availability of the product at the time and place wanted or needed.

In a time like this where economic and technological advancement have become a thing to reckon with the competition in the market place, there is a need to improve distribution effectiveness through the efforts of wholesales, agents, retailers and other types of intermediaries.

Distribution success, which is the availability of products at the right place and time can be achieved through the efforts of the middlemen mentioned above.  But the dynamic nature of the environment and other bureaucratic bottle necks can make this success in distribution not to be realized.

In view of these problems, there is need to incorporate marketing activities in making the products available is the market place or rather improve for more effective and efficient distribution.

1. 1. PROBLEMS THAT SEARCH WILL BE CONCERNED WITH:

The research which was conducted from the Nigerian Bottling Company Plc, Enugu plant lasted from 9th of May, 2005 to 31st May, 2005.

The main concern with this study is for the researcher to find out:

1.       The extent at which Nigerian Bottling Company Plc is involved in distribution effectiveness in their marketing operations.

2.       To suggest ways of improving selling skills efficiency of their salesmen and the dealers.

3.       To find ways of improving the communication gap existing between dealers and the company staff and management.

4.       Ways of checking dealers with their system of company’s coolers and advertising and promotional materials of distribution.

5.       To know the flect requirement analysis with the budget breakdown to all adapts and areas of coverage by salesmen.

1. 1. THE IMPORTANCE OF STUDYING THE AREA:

There are a lot of benefits to be derived from this study besides the fulfillment of the requirement of award of Ordinary National Diploma (OND).

First, this study will be beneficial to NBC Plc in that it will suggest ways of improving distribution effectiveness for better customer satisfaction.

Secondly, the study reveals other militating factors that may hinder effective operations of the company’s distribution channels and ways to guide against it.

Finally, the research hopes to improve the relationship existing between NBC and its dealers.

1. 1. DEFINITION OF IMPORTANT TERMS:

According to Lovis W. Stenn, physical distribution is a process of moving the right quantity of product to marketing channels at a specific time to a specific place in order to be delivered most of efficiently to the industrial user or final consumer.

Philip Kotler also defined distribution as an activities involving planning, implementing and controlling the physical flow of materials and goods from the points of origin to the point of use to meet customer need at a profit.

Marketing is defined as a social process by which individual or group obtain what they want and need through creating, offering, are freely exchanges goods and services with each other.