Distribution Strategies And Customer Satisfaction In Manufacturing Firms

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Distribution Strategies And Customer Satisfaction In Manufacturing Firms


Abstract


The study examined determinant of customer satisfaction through effective wholesale distribution strategies using distributors and retail outlets at the manufacturing industries in Port Harcourt, Nigeria. Specifically the study assessed the nature of distribution channels used by Unilever Nigeria, PIc Marketers for product distribution to distributors and retail outlets in Unilever Nigeria, PIc market in Nigeria; distributor channel differential strategy adopted by Unilever Nigeria, PIc Distributors; effect of Product distribution channel on customer satisfaction at Unilever Nigeria, PIc Market and effect of distribution channels on customer’s satisfaction This case study research had customers and employees as unit of analysis. It had a sample of 20 respondents, whereby primary and secondary data were collected through the use of interviews, questionnaires, and documentary review.
Data were analysed through Statistical Package of Social Science. Findings revealed that distribution channel adopted by Unilever Nigeria, PIc Distributors ensures availability of her products, reduce response time and makes information available to their customer in aspect it facilitates positive relationship with her customers and agents. Also, agreement by respondents to effect that process for getting their concerns resolved is high thus impacts positively on their satisfaction and commitment to doing business with Unilever Nigeria, PIc Distributors. Averagely, respondent agreed to been satisfied with current level distribution channel adopted by Unilever Nigeria, PIc Distributors in products delivery to their shops in Unilever Nigeria, PIc, Nigeria. Based on the findings, it was recommended that Unilever Nigeria, PIc Distributors should be in position to continuously weigh the benefits that accrue from application of distribution channel. Unilever Nigeria, PIc Distributors should ensure strict adherence to their policies and guideline regarding the use distribution channel. Unilever Nigeria, PIc Distributors should ensure aggressive Marketing, regular visit to distributors.


Chapter One


Introduction

1.1 Background of the Study

As industries engage in production of goods and services, they need to make them available to consumers at the right time right place and at the least cost (price).All these cannot be without effective and efficient system put in place. Distribution strategy is the transfer of products from one place to another or from one manufacturer such as wholesaler, retailer, agents and other means such as transportation, communication warehousing etc. (Jobber 2002). Distribution contributes no profit to companies account.

However, without satisfactory distribution drastically which could lead to over stock, due to low sales or patronage of consumers, redundancy in production due to shortage of low material. Dangote group of company was founded in 1977 with the formation of Alco International Limited. Subsequently Dangote Nigeria Limited was incorporated during the 1980s and 1990s, the group ventured into the importation of sugar, milk, flour, fish, rice, cement and iron rods, later,the group embarked on the haulage business, which started with 60 struck under Dangote transport.

Dangote industries limited was incorporated in-order to sustain the groups market leadership in trading commodities and to expand into manufacturing of food, clothing and build materials,

Focus was placed on the following; sugar refining, flour milling, pasta production, salt processing, bulk cement bagging, oil and gas exportation, real estate, propylene bag manufacturing, haulage, textiles,maritime operations and telecommunications. The technical departments specialize through its branches and the stores of approved dealer through the century in the sales and servicing of a wide range of technical products. The company acts through this department as major stockiest and supplier of a comprehensive industry and all types of lighting fitting including water industrial.

  1. The general merchandise department with connection through leading manufacturers in Nigeria and all over the wide range of hardware.
  2. The report service department offer warehouse and delivery services to local manufacturers. This enables them to maintain better stock at all major centers for supply to their distributors.

1.2 Statement of the Problem

The importance of distribution system has been neglected in favour of other marketing functions, manufacturers however, often forget the fact that the only marketing function that linked the consumer products and marketing is the distribution network. The negligence of producers as matter of facts has hampered the effectiveness of distribution system to function well.

The problem of poor Distribution Strategy which are usually defective due to lack of skills and expertise and reliable and accurate information on the sides of the managers, which will often leads to poor forecast and formulation of vague goals and objectives. Also poor policies and implementation strategies is yet another problem which in most cases leads to deviation of results from the sets goals, and poor feedback.

Finally, the very dynamic nature of the business environment which makes forecasting practically impossible, sometimes Jeopardizes the organizational policy.Distribution strategy attracts more business partner and improves company development through satisfying her customers. Companies like Dangote Group of Company require good distribution system to meet the supply with her competitors such Unilever Nigeria, PIc Guinness Nigeria Plc and Nigeria Breweries Plc.). It is based on the above that the researcher tends to investigate Distribution strategies and customer satisfaction of selected manufacturing firms in Port Harcourt.


1.3 Purpose of the Study

The major purpose of this research is to critically examine the distribution strategies and customer satisfaction in manufacturing firms.

  1. To examine the association between Intensive Distribution and customer satisfaction in Port Harcourt.
  2. To examine the association between Extensive Distribution and customer satisfaction in Port Harcourt. 3. To examine the association between Selective Distribution and customer satisfaction in Port Harcourt 1.4 Research Questions
  3. To what extent will quality service bring about customer loyalty?
  4. To what extent does Intensive Distribution affect customer satisfaction in Port Harcourt?
  5. To what extent does Extensive Distribution affect customer satisfaction in Port Harcourt? 3. To what extent does Selective Distributive affect customer satisfaction in Port Harcourt?

Source: Conceptualized from literature, 2016


1.6 Research Hypotheses

H01: These are significant relationship between Intensive Distribution and Repeat Purchase.

H02: These is significant relationship between Extensive Distribution and Customer Loyalty

H03: These is significant relationship between Selective Distribution and Customer Advocacy


1.7 Scope of the Study

The scope of this study covers Distribution Strategy and Customer Satisfaction. This research work will be restricted to the operations of manufacturing firms in Port Harcourt. This will enable the researchers to generalize and affirm how effective Distribution Strategy has been able to bring about customer satisfaction in organizations.


1.8 Significance of the study

This research work shall be of great benefit to.

The marketer:

Who will find the findings of this work very useful, this is because effective distribution strategy expose and make it easy for customer to make order or accept order, it will also make it easy for customers to get what they want at the right time, right place form and the right source. Thus, the study of what distribution strategy to adopt to increase productivity will help the marketer realize his mistakes of the past.

The Company:

Will find this research finding guide valuable, this is because the findings will enable them known their deficiencies and how to correct them.Future Researchers: Will also benefit a lot from this study this is because they may likely want to expand or change their strategy, this work will serve as a stepping stone.


1.9 Definition of Terms

Distribution Strategy:

A plan created by management of a manufacturing business that specifies how firm intends to transfer its products to intermediaries, retailers and end consumers.

Consumer:

Is end user of company goods and or services.

Satisfaction:

The fulfillment or gratification of a desire, need, or appetite.

Channel of Distribution:

The set of all individual and firms that take assist in transferring title of particular goods and services as its move from the producers to the consumers.

Extensive Distribution is often used in an attempt to achieve market penetration by making information about a product or product line, as well as the product themselves, available to a large number of individuals. The opposite of selective distribution.


Chapter Five


Summary of Finding, Conclusions and Recommendations

5.1 Summary of Findings

The general objective of this study is to assess determinant of customer satisfaction through marketing strategies with focus on selected wholesale distributors at the Manufacturing industry in Port-Harcourt. It was found that, the relationship between the Unilever Nigeria, PIc Distributors and their customers is good. The study revealed that, most of the personnel’s working at the Distribution sectors have acquired their SSCE and yet to endeavour in their HND/Degree programmes. The study also revealed that, distribution channel and wholesale products, distributors requirements performance and good relationship management.


5.2 Conclusion of the Study

In reference to the research objectives set, the researcher concludes that channel of distribution plays a positive role. Distribution Channel plays a very important role especially with respect to the food and beverage industry because if the product is not available on time consumes will switch on to other brands and the company will lose its market share and hence an effective distribution channel is the need of this industry. The distribution channel of Unilever Nigeria, PIc Distributors is effective and the Organisation enjoys high agreement from respondent in areas of benefits like easing processes, increasing the supply chain awareness, reducing total costs on distribution of products.

In this finding calls for Unilever Nigeria, PIc Distributors to further improve employees distribution knowledge on product features and benefits, brand meaning, value propositions, customer and competitor characteristics, marketing best practices, and personal selling and encourage employees to process and integrate such knowledge to enhance their capabilities. Again, relationship building will be vital in the attempt to ensure that transfer and integration of knowledge among channel members works effectively.

In industries where products tend to be undifferentiated and intensely distributed, products are non-complex along with homogeneous markets and significant end-customer expertise, product lines are extensive, and firm financial performance is constrained, knowledge sharing on physical distribution functions among channel members should pre-dominate, leading to high importance of physical distribution functions within channel management. Wholesale distributors expect improved and high physical distribution functions with channel management to improve creation of competitive advantage.


5.3 Recommendations of the Study

Below are practical recommendations that will yield substantial results in boosting the role played by distribution channel.

  1. Distributors should seek to adopt the most appropriate model that will aid them to achieve its objectives and reduce operational costs. Distribution channel should be geared at strengthening relationships between them and their customers.
  2. Adoption and usage of information system adoption that will enhance data analysis accrue from distribution channel should be implemented. That is, the distributors should be in position to continuously weigh the benefits that accrue from application of distribution channel to ensure periodic redesign and improvement customers’ satisfaction and Organisational performance.
  3. Distributors should ensure strict adherence to their policies and guideline regarding the application distribution channel. That is the responsible persons should execute their duties in accordance with their policies to ensure performance.
  4. Distributors should ensure aggressive marketing, regular visit to distributors, sales promotion and advertising to be made more frequent for brand building communications should be improved.

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