Marketing channel decisions are among the
most important decisions that management faces. A company’s channel decisions
are linked with every other marketing decision. The company’s pricing depends
on whether it uses mass merchandisers or high quality specialty stones. The
firm’s sales force and advertising decisions depend on how much persuasion,
training, motivation, and support the dealers need. Whether a company develops
or acquires certain new products may depend on how well those products fit the
capabilities of its channel
Companies often pay too little attention to
their distribution channels, however, sometimes with damaging imaginative
distribution systems to gain competitive advantage. Distribution channel
decisions often involve long-term commitments to other firms.
Distribution is the process or moving goods
from producers or manufacturers to the consumers and users. All over the world,
the distributor is regarded as very essential and fundamental link in the
process of transforming goods that are produced by the manufacturer / producers
to the consumers and users. The distributor therefore performs productive
marketing function by ensuring that goods produced get to the ultimate
The effort of the producers to ensure that
their goods reach the market place are likely to be illusive and a pipe dream
unless they are supported by effective distribution. It must be noted, and this
is very vital that the marketing process is an interwoven system in the
marketing which several components have separate but complimentary roles to
play which the distribution function is the last stage.
More so the marketing concept is based on the
orientation of finding consumer’s needs and wants and filling them. These wants
and needs are only deemed to be satisfied when goods produced get to the final
consumer or target market. It is a popular assertion that goods produced have
little or value to the consumer until they are transferred or moved to places
where there is demand for them. And here in lies the relevance and crucial role
of the distributor who transfer these goods to the consumers along side, some
value added to it in form of place, time possession and utilities.
According to Wilson, (1979 P. 37)
distribution broadly is concerned with the most profitable lowest risky way,
short and long term of getting goods to the end users. That is to say,
distribution encompasses both, the channel of distribution takes care of the
number of marketing institutions linked so that title and product can flow to
consumers facilitators and their selection is based on sales communication and
contractual consideration. Physical distribution on the other hand deals with
the logistical transfer of goods and includes activities such as warehousing,
product handling, material handling transportation etc.
The objective of distribution is to get goods
to the right place, at the right time and at a reasonable cost. Little wonder
Cunditt, still and Govon: (1980, P 10) looked at distribution as encompassing
activities involved in transferring goods from producers to final buyers and
users, not just activities, cost elements are involved. The ill defined nature
of distributive systems in automobile industries can be traced to the nation’s
economy not being mass productive. It is still a developing economy and
possesses all the characteristics of a developing economy. Marketing is usually
identified with an economy of abundance where a nation produces far beyond the
subsistence needs. Because our economy is under producing, existing automobile
industries such as ANAMMCO who find their market in Nigeria assume that
mechanisms exist and will continue to more their products from factory to their
customer. They seldom plan changes in distribution system as they would plan in
details for changes in population pattern, consumer buying habits and product
technology. To this end distributors have come under great criticism and are
labeled all sorts of names like exploiter “parasite” saboteur and sometimes as
someone who services no useful purpose in the economy.
For the fact that distributors in this state
do not perform their functions effectively in light of inadequate
Poor Warehousing facilities
b. Deplorable road networks and transportation
etc, developing nation including Nigeria are examining principles to see how
their distribution strategy can be see how their distribution strategy can be
improved and how they could be to enhance efficient distribution of their
It is a yardstick to provide basis information on effect of distribution
in our economy.
It will enable further research work to be carried on the same field of
It will contribute to the body of knowledge about distribution strategy
It will benefit marketing companies who will have a chance between
setting up a distribution company and being a representative of major marketer.
It will also benefit distributors and final users.
SCOPE OF THE STUDY
This study is hurtled to an appraisal of
distribution strategies of automobile industries with reference to Anambra
Motor Manufacturing Company (ANAMMCO) Eneme in Enugu State.
LIMITATION OF THE STUDY
This project is focused on an appraisal of
distribution strategies of automobile industries with a case study of ANAMMCO.
The area covered in this study is ANAMMCO
this is as a result of time and financial constraint considering the economic
crunch around the corner. It is pertinent to mention 2here that the researcher
did not collect all the data and information for this thesis because in most
cases, the statistical figures were withheld by ANAMMCO employers and
STATEMENT OF THE PROBLEMS
They are as follows
1. We work on the assumption that
the company fail to take into consideration which channel of distribution
strategies and intermediaries will provide for the considered services
2. Failure to put into
consideration which channel of distribution strategies and intermediaries will
be most profitable in the foreseeable future
3. Another factor that poses a
problem is the inability of the company to determine which channel of
distribution strategies and intermediaries will provide for the relative cost
4. Failure to understand,
comprehend and leact to certain problems encountered by consumers on
consumption of their product.
5. Poor implementation of effective institutional
advertising such as direct marketing relation public awareness, communication
FORMULATION OF HYPOTHESIS
ANAMMCO do not study and appraise warehousing system.
ANAMMCO do not appraise the existence of distributive chains
ANAMMCO do not appraise the role of the distributor in ANAMMCO
ANAMMCO do not found out whether distribution strategy is utilized in
ANAMMCO do not ascertain whether the evaluation of distribution
strategies has improves the company.
ANAMMCO do not examine the company’s direct or indirect distribution to
ANAMMCO do not determine whether the company has quality control
The null hypothesis below clearly reflect the
research objective of the study to guide this study, seven null hypotheses were
formulated they are as follows;
ANAMMCO do not study and appraise warehousing system
ANAMMCO study and appraise warehousing system
ANAMMCO do not appraise the existence of distributive chains
ANAMMCO appraise the existence of distributive chains
ANAMMCO do not appraise the role of distributor in ANAMMCO
ANAMMCO appraise the role of distributors in the company
ANAMMCO do not found out whether distribution strategy is utilized in the company.
ANAMMCO fin out whether distribution strategy is utilized in the company.
ANAMMCO do not ascertain whether the evaluation of distribution strategies has improved
ANAMMCO ascertain whether the evaluation of distribution strategies has improved
ANAMMCO do not examine the company’s direct or indirect distribution to
ANAMMCO examine the company’s direct and indirect distribution to the customers
ANAMMCO do not determine whether the company has quality control department.
ANAMMCO determine whether the company has quality control department
SIGNIFICANCE OF THE STUDY
The importance of this study cannot be
overemphasized when one think about the significance of role of distribution on
the demand of goods and services in the automobile industries and the society
at large. Furthermore, the producer of merchandise destined for industrial
markets should be alive to this fluid situation and maintain a constant review
of in distribution policy (Elvy (1980: 149).
The gap between the producer and consumer is
bridged by distribution channels. The do this by providing ultimate users with
a convenient means of obtaining the goods and services by desire. Distribution
strategy therefore are comprised of the marketing institutions and the
inter-relationships responsible for the physical flow and the flow of goods and
services from producer to the industrial users, marketing intermediaries or
middlemen are the marketing institutions in the distribution channel, that is
firms that operate between producers and customers or industrial purchasers.
Most automobile industries distribute by direct
selling or direct marketing strategy through contracts between the buyer and
seller in the regards, direct channels are considerably more important in the
industrial market as the producer could be installed or giving the directive of
use by the manufacturer. Agents are used in the industrial market when small
producers attempt the market their offering to large wholesalers. The agent,
wholesaling intermediary, often called a manufacture’s representative serves as
an independent sales force in contacting the wholesaler buyers where the unite
sale is large and transportation accounts for a small percentage of the total
cost, the producer – agent – industrial user channel is usually employed. The
agent wholesaling intermediaries in affect because the company’s industrial
sales force, Ecloyce and Ani (2000: 212 – 213)
The importance of this study is to contribute
to the following:
It will improve social-economic growth rate of the company
It will help the automobile industries to make use of effective
distribution strategy, marketing research, advertising and pricing to increase
their effectiveness in planning and distributing goods. Furthermore, an
appraisal of distribution strategies of automobile industries will be a lift to
improve the strategic distribution of the industries product and evaluate the
distribution process of the industry as the corporate objectives of the company
has mostly on the proper integration of marketing information system (MIS).
In the research work, the researcher’s aim of
embarking on this study is to know whether distribution strategies of
automobile industries had utilized the effect of distribution in an industry.
The priority of the researcher is to investigate and bring to light as well as
evaluate distribution strategies impact to the manufacturing.
OBJECTIVE OF THE STUDY
The researcher believes that it is pertinent
to point out that marketing distribution strategy makes an impact in the
consumer and producer. It has therefore becomes necessary to find out the
strength and weakness of individuals, groups and organization involved in the
activities with view of appraising critically their activities toward the
realization of the consumer goal
Therefore, the objective of this study is to:
To determine the study and appraise the warehousing in ANAMMCO
To determine the appraise of the existing distributive chains
To determine the appraisal of the role of distributors in ANAMMCO
To find out whether distribution strategy is utilized in the company.
To ascertain whether the evaluation to distribution strategies has
improve the company
To examine whether the company’s direct or indirect distribution to the
To determines whether the company has quality control department.
DEFINITION OF TERMS
1. Commission Agent: – an agent
who has a monopoly over the sale of
commodity who only sells to others on
payment of a commission.
2. Retailer: – A merchant or sometimes an agent whose
business is to sell directly to the ultimate user.
3. Advertising: – Use of
communication to make people know about the existence of a company and its
4. A Marketing: – Marketing is a
human activity directed at
satisfying needs and wants through exchange process
5. Marketing Concept: – Marketing
concept holds that the key to
achieving organizational goals consists in determining the needs and wants of
target markets and delivering
the desired satisfactions more effectively and efficiently than competitors.
6. Services: – These are
separately identifiable intangible activities which provide want satisfaction
when marketed to customers and or industry users and which are not necessarily tied to the sale of
7. Distribution Channel: – This
is a set of interdependent
organizations involved in the process of making a product or service available for use
or consumption by the consumer.
8. Wholesaler: – A firm engaged
primarily in wholesaling
9. Marketing Strategy: – The
marketing logic by which the business
unit hopes to achieve its marketing
10. Marketing Research: – The systematic design, collection, analysis, and reporting of data
relevant to specific marketing
situation facing an organization
Target Market: – A set of buyers sharing common needs or characteristics that the