ABSTRACT
This work is aimed at a study of the problems and prospects of marketing industrial products in Nigeria.
Marketers in the
industrial sector are no longer in doubt as whether there are problems
facing industrial products in the market. But the major problem facing
them now is knowing how to solve these problems. This leads to whether
lack of effective marketing communication, has any negative impact on
the product patronage. How do users of industrial products know about
new products and what industrial marketers do to reduce this low product
patronage. The purpose of this study was to determine the problems
hinder marketing industrial product in Nigeria, as well as making
necessary recommendations, in view of the findings. In realizing the
purpose of the study, 322 respondents from selected industrial product
manufacturing firms in Enugu were studied using questionnaires. Their
responses were also analysed using statistical tools.
Based on the data
collected and analysed the following findings among others were made:
Price of industrial products does not have significant impact on the
product patronage. Product preference by users has no strong influence
on the product patronage. Lack of effective marketing communication has
significance influence on products patronage.
Sequel to the
findings, the following recommendations were made: Industrial marketers
should be carrying market research periodically, to ascertain the areas
that require improvement.
And also since lack
effective marketing communication has a significant influence in
marketing industrial products in Nigeria, industrial marketers should
engage in more market to know exactly what the situation in the market
place is.
TABLE OF CONTENTS
Title page - - - - - - - - - i
Declaration - - - - - - - - ii
Certification - - - - - - - - iii
Dedication - - - - - - - - iv
Acknowledgement - - - - - - - v
Abstract - - - - - - - - - vi
Table of Contents - - - - - - - vii
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study - - - - - 1
1.2 Statement of Problems - - - - - 6
1.3 Research Questions - - - - - - 7
1.4 Objectives of the Study - - - - - 7
1.5 The Significance of the Study - - - - 8
1.6 Research Hypotheses- - - - - - 8
1.7 Scope of the Study - - - - - - 9
1.8 Limitations of the Study - - - - - 9
1.9 Definition of terms - - - - - - 10
References - - - - - - - - 12
CHAPTER TWO
LITERATURE REVIEW
2.1 Industrial Market Classification by Product
Categories - - - - - - - - 14
2.2 The Neglect or the Negligence of Agricultural
Sector in Nigeria - - - - - - 18
2.3 Definition of Salesperson/Salesmanship - - 31
2.4 Salesmanship - - - - - - - 32
2.5 Information gathering Function of Sales
Person for effective Marketing - - - - 34
2.6 Business Orientation in Nigeria - - - - 36
2.7 Problems that Hindered the Marketing of Industrial Products - - - - - 39
2.8 Prospects of Marketing Industrial
Products in Nigeria- - - - - - 43
References - - - - - - - - 47
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Brief Outline the Chapter - - - - - 49
3.2 Restatement of the Research
Questions and Hypothesis - - - - 49
3.3 Research design - - - - - - 50
3.4 Characteristic of the Study population - 51
3.5 Sampling design or Plan - - - - - 51
3.5.1 Sampling Element or Unit - - - - 51
3.5.2 Sample Size - - - - - - 51
3.5.3 Sampling Instrument - - - - 53
3.5.4 Design and Administration of the
Questionnaire - - - - - - 54
3.6 Allocation of the data Collection Instrument - 55
3.7 Procedure for Processing and Analyzing Data - 56
References - - - - - - - - 56
CHAPTER FOUR
Presentation, analysis and Interpretation
4.1 Data Presentation - - - - - - 63
4.2 Data Analysis - - - - - - 68
4.3 Testing of three Hypotheses - - - - 74
4.4 Results - - - - - - 84
CHAPTER FIVE
SUMMARY, CONCLUSION, AND RECOMMENDATION
5.1 Summary of Findings - - - - - 82
5.2 Conclusion - - - - - - 84
5.3 Recommendation - - - - - - 85
Bibliography
Questionnaire
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
This research work is on the topic:
problems and prospects of marketing industrial products in Nigeria.
This work is centered on some selected production companies in Enugu
metropolis. The researcher decides to use Emenite Nigeria Limited, Alo
Aluminum and Ozomac Company as her case study. These manufacturing
companies specialized in the production of roofing materials and other
building materials. These companies are located in Enugu urban of Enugu
State. Emenite Nigeria Limited is located in Emene industrial Layout
Enugu. Alo Aluminum Company is located along Abakaliki expressway Emene
Enugu while Ozamac Construction Company is located at Trans Ekulu Enugu.
Emenite is a franchise firm that is owned by Etex group. This company
has its corporate headquarters in Belgium. Emenite uses 60% of local raw
materials in its production. At its conception, the company was nothing
but only a roofing sheet factory. The prevailing situation now is from
a mere roofing sheet industry to a fully building materials
manufacturing company. The Alo Aluminum and Ozomac construction
companies are Indigenous companies. They make use of 100% local raw
materials in their productions. They started as mere roofing sheet
companies, before they fully graduated into building material production
companies.
These companies have their distributors
located in some places in Enugu. These companies facilitate their
performance with good distribution channel, availability of genuine
products and efficient after sales services.
EVOLUTION OF MARKETING
Marketing is an old and a new
profession. Marketing is old in the sense that, since the beginning of
man, exchange or trade has been in existence.
The advent of barter system
coupled with the concept of division of labour and the ensuring of
specialization gave rise to the production of surplus.
People started making more than they
need of certain products, so trade (change), which is the heart of
marketing became inevitable. Marketing started evolving in earnest when
small producers began to manufacture their goods in large quantities in
anticipation of future orders, middlemen with their institutionalized
channels then appeared on stage to facilitate the communication of
buying and selling of the resultant increased output. The desired
impetus was given marketing by the industrial revolution, which brought
with its mechanization and consequent search for mass marketing.
The newness of the course marketing,
lies in the fact that marketing is now scattered in such fields as
selling advertising, pricing, production, design packaging, branding and
physical distribution. These areas are major concern of marketing.
The advent of specialized sales
department helped to a considerable extent in resolving the
organizational predicament of market expansion. There was problem of
communicating with the customers, but manufactures were compelled to
shift certain marketing functions to the middlemen. Initially goods and
services were sold to retailers, who eventually resold them to final
customers.
INDUSTRY AND MANUFACTURING BACKGROUND
The history of Industrial development
and manufacturing in Nigeria is a classic illustration of how a nation
could neglect a vital sector through policy inconsistence and
distributions attributed to the discovery of oil. The near total neglect
of agriculture has denied manufactures and industries their primary
source of raw materials. The absence of locally sourced inputs has
resulted in low industrialization.
Today, the Nigerian industries
and manufacturing sector account for less than 10% of Nigerian's GDP,
with manufacturing capacity utilization remaining below 35% for the most
part for the cast decade.
Players in the Nigerian industrial and
manufacturing sector can be classified into four groups; multinational,
national, regional and local. Apart from the multinational operators,
most of the players have disappeared in the last two decades, due to
unpredictable movement policies, lack of basic raw materials most of
which are imported.
Some of the constraints faced in this sector Include:
- High interest rates
- Unpredictable government policies
- Non-implementation of existing policies
- Lack of effective regulating agencies
- Infrastructural inadequacies
- Dumping of cheap products
- Unfair tariff regime
- Low patronage
Globalization and liberalization pose
challenges to the Nigerian industrial sector. The impact of these global
protections, increase focus on product quality and increase expenditure
on research and development. The prospects of manufacturing in Nigeria
are bright given the nations nascent democracy, a market size of over
120 million people, rich mineral and other resources size of the West
African market as well as cheap and abundant labour. Developing
Nigeria’s industrial sector requires the concerted efforts of government
and the private sector to create an environment that would encourage
investments, primarily by Nigerians as firm basic for attracting and
sustaining foreign investment in the sector. A fully developed
industrial sector world provides a firm basis for sustainable economic
growth and development.
The most
pronounced objectives of most business ventures is profit making. This
objective is achieved when the products and services get to the final
users or customers at the right place right time and right price. The
reason is that firms depend on the customers for the sale of their
products. Marketers are no longer in doubt as to whether their products
are needed in the market place, but are interested in knowing the
problems that associate with the marketing of industrial products. The
study of problems and prospects of marketing industrial products allows
marketing managers to develop an insight into what lies behind the
problems and prospects of marketing industrial products in Nigeria. Also
knowing the cause of the problems and solutions are important.
Firms in building material industry like
Emenite, Aluminum and Ozomac construction companies etc. want to know
those problems that associate with marketing of industrial products. The
pressing need and task facing the manufactures and marketers of
industrial products is to find out the factors or variables that exert
the greatest problem in marketing industrial products.
1.2 STATEMENT OF THE PROBLEM
In the
contemporary marketing environment, it has always been a difficult task
to identify exactly the factors that pose problems in marketing
industrial products. Most marketers have paid attention to factors which
in their own estimation determine as the cause of the problems without
giving due consideration on how to solve those problems. The reason is
that, marketing plans designed for a particular product of industry
failed to attain the desired and targeted result.
The basic problem here is to know how these problems affect industrial products in the market place:
- Unorganized marketing system.
- Product adulteration
- Lack of effective marketing information system.
- Unpredictable government policies.
- Price instability.
- Lack of effective regulatory agencies.
- Poor management.
Absence of good market research competition from imported products.
Based on this, the following research questions need to be answered.
1.3 RESEARCH QUESTIONS
Has the problem of unorganized marketing any impact on the marketing of industrial products?
If yes, to the above question, then what should marketers of industrial products do to reduce this problem?
1.4 OBJECTIVES OF THE STUDY
Every marketing plan has
objective which it targets to achieve. Most times the stated
objectives are not achieved. In view of this, the question remains – are
they other factors beside the factors stated in the statement of the
problem that influence marketing of industrial products.
The objectives of this study are:
- To evaluate how organized marketing system affect marketing of industrial products.
- To identify the most suitable distribution channel for industrial products
- To establish adequate market research
- Establish good marketing information system.
- To make necessary recommendations, in view of the findings.
1.5 THE SIGNIFICANCE OF THE STUDY
In accordance with the modem
stipulation of effective application of promotional tools supplement an
organizational effort in the achievement of certain marketing
objectives, which the development of the brand/product as well as
complementing other parameters of the marketing mix. To this regards,
this study is meant to throw more light on the marketing of industrial
products in Nigeria. The topic of this research is important to the
revamping of the Nigerian economy. The importation of industrial
products into the country is contributing to the galloping inflation, we
are witnessing today because it draws us down to deficit in our
economy.
1.6 RESEARCH HYPOTHESES:
In the course of this research, the
following hypotheses where were formulated based on the research
questions and objectives. The hypotheses were tested in the research
work.
1. Prices of industrial products have significant impact on the marketing of industrial products.
2. Product preference has strong influence on the marketing of industrial.
3. Lack of adequate marketing communication hinders effective marketing of industrial product.
1.7 SCOPE OF THE STUDY
This study is confined to only three
production companies in Enugu metropolis. This means that the empirical
study covered only to the staff of these companies, and their
distributors. This limited scope is not withstanding, it is hoped that
the finding which may generate from the study will be useful to both the
staff of these companies and students, who intended to undertake
marketing as a profession.
1.8 DEFINITION OF TERMS
Marketing strategic planning:
Is the process that selects and directs the entire action of the
marketing organization within the policy guideline to achieve the
objectiveness and goals of the firm.
Physical Distribution:
The tasks involved in planning and implementing the physical flow of
materials and final goods from points of origin to points of use, to
meet the needs of customers at a profit.
Producer Markets: The
set of organizations that buy products for the purpose of using them in
production process to make profit or achieve other objectives.
Organization marketing: Those activities undertaken to create, or alter attitudes and/or behaviour of target audiences toward particular organization.
Merchant Middlemen: Business firms such as wholesales and retailers that buy, take little to and resell merchandiser.
Marketing system: A set of interacting participants, markets, and flows that are involved in an organized arena of exchange.
Marketing channel: A method of organizing the work that to be done to move goods from producers to users.
Harvesting strategy: A
marketing strategy in which the firm sharply reduces its expenses to
increase its current profits, knowing that this will accelerate the rate
of sales decline and ultimate demise of the product.
Distribution structure: All available arrangements in a particular industry to get products from the producers to the users.
Containerlization: The putting of goods in boxes or trailers that can easily be transferred between two or more modes of transportation.
Evoked Set: The set of alternatives that the buyer might or did consider at that stage of the decision process.
Closed and question: A question in which the possible answers are supplied.
Functional Marketing Organization:
A form of marketing organization in which the various marketing
functions are headed by separate managers who report to the marketing
vice president.
Macro environment: The totality of major institutions and forces that are external and potentially relevant to the firm.
Open-end-question: A question that the respondent is free to answer in his or her own words.
Market Potential: The
limit approached by market demand as industry marketing expenditure goes
to infinity, for a given set of competitive prices and a given
environment.