CHAPTER ONE

INTRODUCTION

1.1

BACKGROUND OF THE STUDY

Physical distribution is the set of activities concerned with efficient
movement of finished goods from the end of the production operation to the
consumer. Physical distribution takes place within numerous wholesaling
and retailing distribution channels, and includes such important decision
areas as customer service, inventory control, materials handling, protective
packaging, order procession, transportation, warehouse site selection, and
warehousing. Physical distribution is part of a larger process called
"distribution," which includes wholesale and retail marketing, as well the
physical movement of products.
Physical distribution activities have recently received increasing attention
from business managers, including small business owners. This is due in
large part to the fact that these functions often represent almost half of the
total marketing costs of a product. In fact, research studies indicate that
physical distribution costs nationally amount to approximately 20 percent of
the country's total gross national product (GNP). These findings have led
many small businesses to expand their cost-cutting efforts beyond their
1

historical focus on production to encompass physical distribution activities.

The importance of physical distribution is also based on its relevance to
customer satisfaction. By storing goods in convenient locations for
shipment to wholesalers and retailers, and by creating fast, reliable means
of moving the goods, small business owners can help assure continued
success in a rapidly changing, competitive global market.
Marketing in Nigeria beginning to occupy its proper position in the Nigeria
economic set up. The current economic recession is ushering in more
marketing activities necessary to ensure economic development and
national growth. The importance of physical distribution to organization
individual and the economic as a whole can never be overemphasized;
physical distribution therefore is the actual increase of goods and services
from their sources and place of production to when they are needed for
industrial use or final consumption. Without physical distribution,
organization will not be met because goods produced will not be physically
available for consumer use. Thus to achieved a good market share the
company should have a good distribution network. That is ways and means
where goods and services is very crucial for promoting its sales, market
share and its effective transportation to the various points up purchases or
distribution. Also the cost of distributing some consumer durable, forms a
2

major elements of the total cost and any inefficiency at this level is likely to
make the product uncompetitive as the cost of distribution will finally
reflect in the unit price of the product.

1.2

HISTORICAL BACKGROUND OF THE CASE STUDY

Coca cola Nigeria Plc Kaduna is a multinational company housing its
head office in Lagos. This company has its operation in various countries
worldwide with some in Africa particularly in Nigeria, which was
established in the year 1953 in Lagos. It incorporated in Kaduna branch,
Kaduna state in the year 1980 under the same name (coca-cola plc) for the
purpose of manufacturing mineral water, can drink, table water and five
alive fruit juice which comes in three flavours namely: any initially has a
staff of about 264 workers when it started production in 1980, but of recent
the company have a staff of about 397 workers. The companys branch in
Kaduna, make a direct supply to the deports under it, which in turn make
direct sale to distributors, retailers and final consumer in their domain.

1.3

STATEMENT OF THE PROBLEM

This could be approached from this perspective. Transportation: How
developed is the transportation network in the country? Do we have
adequate means of transportation and infrastructural facilities? Inventory
(storage): what is the level of inventory (storage) how are they managed.
3

How effective is our communication network warehousing. Are our

warehouse develop and up to standard? Are there enough warehouse to
stock goods.

1.4

OBJECTIVES OF THE STUDY

The purpose of the study is to determine the importance of physical
distribution in the marketing of consumer goods. We concentrate in the area
of transportation inventory, communication and warehousing. The aim of
production is not complete if goods do not reach the ultimate consumer or
end user. These activities help in getting goods produced to consumers or
end users. The attempt of the problem of physical distribution is to balance
the level of service to consumer against the most of doing. So also to
examine the extent to which the existing problems in the country have been
solved.

1.5

SIGNIFICANCE OF THE STUDY

With the recent downward trend in the economy, an increase in population
growth in recent times and some government policies relating to the
importation of both raw materials and finished goods which has made it
difficult and expensive for most firms and manufacturers who rely imported
4

raw materials to obtain and the indecencies involved in moving both raw
materials and finished goods from one place to another. Capitalizing in the
scarcity of goods due mainly middlemen have restore to hoarding such
items, even in areas where they are available, instead of distributing them as
required with intention of marking more perfects. The effort therefore is to
suggest ways of arresting the problems with the country is facing due to
inefficient and insufficient physical distribution system.

1.6

SCOPE AND LIMITATION OF THE STUDY

The scope of this project work will be the importance of physical
distribution in the marketing of consumer goods. Also, the study will focus
mainly inadequate state being the immediate environment of the study. A
number of problems contributed constraints in the process of this project
work, lack of enough textbooks and journals in the subject of the study. The
research of the nature should have covered every corner of Kaduna but it
was not so due to the above mentioned problem. The researcher had to go to
coca-coal to get information. Transportation and financial problems
encounter by the researcher serves as the limiting factor for this project.
Time was also a limiting factor for this project. The time given was too
short which of course meant that researcher that have to be made on the
stud has to be short to do the limited time.
5

1.7

STATEMENT OF HYPOTHESIS
Ho: That effective distribution does not enhance significantly an
organizations marketing of goods and service.
H1: That effective distribution enhance significantly an organizations
marketing of goods and service.

1.8

DEFINITION OF TERM
Certain terms used in the study need to be defined to avoid difficulties and
enhanced better understanding. Such terms includes:
DISTRIBUTION: Is an important element of providing satisfaction in the
market place. Distribution involves the physical movement of product to
ultimate consumer.
PHYSICAL DISTRIBUTION: Physical distribution involves planning
implementing and controlling the physical flow of materials and furnished
goods from point of origin or production to point of use to meet the needs
of consumer at a profit.
CHANNEL OF DISTRIBUTION: This refers to the medium/channel use in
the transfer of goods from producer to consumer. The channel refers to the
system of marketing. It involves all the intermediaries thus perform the
function, the serve to put the product into the hand of consumers.

CUSTOMER: the customer represent the peoples that buy goods from the
producer whether for industrial use or for final consumption while.
CONSUMER: is the final user of the product.
NEEDS: this refers to the necessary things consumers can not do without
e.g. toothpaste, cloth etc.
WANTS: Are as a result of positive charges incomes thus consumer will no
necessarily buy what he need but what in want.

END NOTES
Amarchand, Detail: (1979):

An introduction to marketing Vikas

Publishing House, Delhi.

Nnolim D.A (1979):

Marketing as a too for economic

development in Nigeria carsell Ltd.

Philip Kotler: (1988):

Marketing management analysis

planning implementation and control Sixth
Edition

CHAPTER TWO
LITERATURE REVIEW
2.0

INTRODUCTION
This chapter will review comments, statement and opinions made mainly by
previous person or groups of persons as contain in books, newspaper and
magazines and journals having direct bearing on the topic of this thesis.

2.1

WHAT IS MARKETING
The institute of marketing, define marketing as the creative management of
resources which promote trade and employment of assessing consumer
needs and initiating research and development to meet them. Considering
the word marketing from the logical aspect of life, we can depict clearly
that, marketing principles and activities have helped greatly in the
development and advancement of world economy. The course try to
practically establish an harmonious relationship between two important
component of the world which is people (human beings) and its
environment. Marketers operate in a complex environment which require
proper understanding and analysis for effective control, planning and
implementation that will commensurate with the consumers needs and
want. Hence providing profitable satisfaction which serves as the
paramount aim of marketing.
9

Marketing activities embraces those activity engaged into satisfy the

economic needs and want. Its root can be traced to the early existence of
man, when trade by barter was the chief means by which people satisfy
their needs and wants of the people. The problems associated with barter
system leads to the emergence of scholars to deliberate on how to solve this
related problems and promote human economy. This result to the
innovation and invention of some organization that assist in coordinating
human and environmental resources identification of consumers needs and
wants, determine demand and market offering, promote exchange and
relationship establishing market, and creating customer value and
satisfaction. Today, the organization that carry out the above activities is
termed MARKETING.
The word marketing has in recent time, gain widely usage and acceptance,
yet it means different thing to different people. It is most often not
understood and misinterpreted. Some marketing definition includes:

DEFINITIONS
According to Kotler and Armstrong (2015): Marketing is a social and
managerial process by which individuals and organization obtain what they
need and want through creating and exchanging value with others.

10

According to PRIDE and FERREL (1993) define marketing as consisting of

individual and organization activities aimed at facilitating and expediting
exchanges within a set of dynamic environmental factors.
To Stanton (1983): Marketing is a total system of business activities design
to plan, price, promotes and distribute ones satisfying produce and services
to present and potential customers.
According to the institute of marketing (Uk marketing manual 1998):
Marketing is the management process which identifies, anticipates and
supplies customers requirement efficiently and profitably.
2.2

WHAT IS DISTRIBUTION
Distribution refers to a set of interdependent organization that help make a
product or services available for use or consumption by the consumer or
business user. Distribution which is also known as marketing channel assist
in companys value delivery network. A companys channel decision
directly affect every other marketing decisions.
Companies often pay too little attention to their distribution channels,
sometimes with damaging results, in contrast, many companies have used
imaginative distribution systems to gain a competitive advantages.
Distribution is important to marketers as it helps in concluding the process
of production, which is achieved by getting the right set of products to the
right place at the right time. It importance is reflected in the fact that
11

distribution costs emerge from 10% to 25% of sales revenue. Therefore,

management must design its channel carefully, with an eye on tomorrows
likely selling environment as well as todays.

2.2.1 DETERMINING THE INTENSITY OF DISTRIBUTION

As earlier mentioned, a producer must consider the nature of the product,
the characteristics of the individual buyer, the buying habits of the buyer,
and the competition he faces, among others, before he determines what he
can or should do. This includes selective distribution, executive distribution
and intensive distribution.
a.

SELECTIVE DISTRIBUTION: This is a policy of a producer who

selects a limited number of wholesales and retail distributors and
works closely with them to further the sale of his mechanize.
Generally, this is done on a carefully worked out plan. Selective
distribution can be used on any type of product, even with
convenience goods, but such a policy will restrict the distribution.
The idea is to select the best distributor available, concentrate efforts
on them, an thus obtain a greater selling effort for the products.
Normally, the volume of business desired is important in appointing
selective distributors. Fewer distributors may mean fewer sales and
12

fewer contacts with prospective buyer. (customers and clients). There

are distinct advantages, however, in appointing selective distributors,
the producer can pick the outlets he wants. He can concentrate on
them, and eliminate some of the marketing problems, which beset
almost all marketers who sell on a local or national basis.
Generally, selective distribution lends itself better to shopping goods
which carry a higher unit price, and which are not purchased as
frequently as convenience goods.
b.

EXCLUSIVE DISTRIBUTION: This refers to the practice of

selecting and giving a distributor on exclusive territory. The producer
agrees to sell to no one else in that territory. This is called an
exclusive selling agreement. The distributor in turn agrees not to
handle or to deal in any competing products. An exclusive
distributorship limits the contacts with the buying public, and thus
the total volume of possible sales. In return, the producers gains by
knowing that his products will be featured and, if the dealership has
been chosen with care, the producer acquires a degree of prestige
because of having an exclusive dealer. It is to the advantage of the
exclusive distributor to push the merchandise because he is not only
protected as far as competitors in the area are concerned, but he is
protected against any price cutting if the price reduction are made,
13

the manufacturer makes them by fully protecting the dealers margins

and profits as he does so.
c.

INTENSIVE DISTRIBUTION: Producer of consumer goods mostly

adopt intensive distribution policy. Consumers demand immediate
satisfaction with this class of product and will not defer purchases to
find a particular brand. Retailers often control the extent to which the
policy of intensive distribution can be implemented. For example, a
new producer of toothpaste may want distribution in all Nigeria
supermarkets, but the retailers may limit their assortment to the
fastest selling toothpaste brands. Intensive distribution places must
of the burden of promotion on the producer. Retailers will not pay to
advertise a product that is sold by all their competitors, rather spent
their money on product that is able to gain market share.

2.3

PHYSICAL DISTRIBUTION AS A MARKETING FUNCTION

In todays global market place, selling a product is sometimes easier than
getting it to customers. Companies has to decide on the best way to store,
handle, and move their products and services so that they are available to
customers in the right assortment, at the right time, and in the right place.
Physical distribution has a major impact on both customers satisfaction and
company cost.
14

Also, physical distribution serve as one of the decision area in the

distribution

management

process,

which

encompasses

planning,

implementing and controlling the physical flow of materials, final goods

and related information from points of origin to points of consumption to
meet customers requirement at a profit. The consequent activities include
handling,

transportation,

warehousing,

communication,

inventory

management, packaging and other processes all of which are inter-related.

Therefore, the logistics manager task is to co-ordinate activities of
suppliers, purchasing agents, marketers, channel members, and customers
in order to achieve channel functions.
Planning an effective physical distribution system can be a significant
decision in developing a marketing strategy. It places a company in a better
competitive position among its competitors, by using improved logistics to
give customers better service or lower prices.
In this context, we shall examined or review some authors comment and
definition on the subject matter.
According to Philip Kotler and Gavy Armstrong (2015): Physical
distribution involves planning, implementing and controlling the physical
flow of goods, services and related information from point of origin to point
of consumption to meet customer requirement at a profit.

15

According to Ayuba (2005): Physical distribution is the physical movement

and storage of products and suppliers both within and among market
channel members. It also refers to transportation, handling and storage of
product in the process of moving them from where they are to where they
are needed.
According to Nwokoye (2003): Physical distribution or logistics is
concerned with the efficient movement of raw materials from suppliers and
finished goods from the end of the production line to the customers.
According to Akpan (2003): Physical distribution involves the actual
movement and storage of goods after they are produced and before they are
consumed, its goal is therefore to get the right goods to the right place at the
right time for the least cost.
According to Osuagwu (2002): Physical distribution refers to a series of
marketing institution through which title to or control of a product, services
or idea is transferred from producer to customers, clients, or business users.
According to Sanusi (2000): Physical distribution is the broad range of
activities within a company concerned with the efficient movement of
goods and materials both inward to the point of manufacture, and outward
from the end of production line to the consumers.

16

2.4

OBJECTIVES OF PHYSICAL DISTRIBUTION

The main goal of physical distribution is to ensure that the right products
are available to consumers in the right place at the right time. i.e. timely and
accurate delivery of customer needs and want at a profit (customer
satisfaction and company cost). Hence, these overall goals and objectives
have several aspect that we should examine more closely:

a.

AVAILABILITY
The most basic objective of physical distribution is to ensure that
suppliers met customers demand in order to maintain and establish
good customer relationship that has a long run effect. To achieve this,
most companies employ the services of marketing intermediaries i.e.
middlemen to perform the task of effective movement of goods and
services from the producer to the end users.

b.

CHANNEL MANAGEMENT
During distribution process, managers must implement and manage
the chosen channel. This call for selecting, managing and motivating
individual channel members and evaluating their performance
overtime. They are linked together through the exchange process in
order to cerate time and pace utilities to meet its goal. Channel
17

management means the activities involved in independently to ensure

effective and efficient distribution of goods and services to the end
users.
c. DELIVERY OF UNDAMAGED GOODS
Physical distribution must also pay attention to all activities that
cause damage of goods. Material handling, product packaging,
storage and mode of transportation must be carefully watch to ensure
safety of goods till it reaches the desire or final destination.
d. SPEEDY AND RELIABLE DELIVERY
Physical distribution must be perform between the time a need for
product is recognized by a channel member and the time when those
product are received, closely aligned with the speed of services and
the channel member dependability. Thus, channel member must be
keenly aware of their customers location and their demand schedule
in order to meet up with consumer requirement. Timeliness and
reliability is of high important in physical distribution because it is
used as a yardstick for measuring the performance of the channel
member in delivering and satisfying consumers needs and want.

18

2.5

IMPORTANCE OF PHYSICAL DISTRIBUTION

The importance of physical distribution in a companys marketing strategy
can be seen in the following instances:
i.

it help in bridging the major time, place and possession gaps that
separate goods and services from those who would use them.

ii.

Physical distribution increases customers satisfaction by making

product available at the right time, and at the right place, ensuring
efficient order processing, sizeable inventories, availability of
product for emergency shipments.

iii.

Producers and customers are often located several kilometers away

and products must be transported and stored at points more accessible
to them.

iv.

Manufacturers often produce in anticipation of market demand, they

must therefore hold inventories until orders are received and filled.

v.

Speed of delivery, dependability along with services is often as

important to buyers as cost.

vi.

2.6

The use of efficient transportation reduces costs.

CHANNELS OF DISTRIBUTION AND IT IMPORTANCE

The term channels of distribution refers to the system of marketing
institution through which goods or serves are transferred from original
19

producer to ultimate consumer. The channel is made up of all the

intermediaries that performs the functions that help to put the product into
the hands of customers. In some cases, the part or route taken by the
product itself may differ from that taken by ownership of the product of
title. This happens because some intermediaries do not take title to the
product but simply facilitate exchanges. Types of channel member
employed depend on some certain factors vis a vis the type of goods and
services to be transferred to the customers.

CHANNEL STRUCTURE
As the product move from producer to ultimate consumers, various
exchange transaction take place in the process, a number of tangible and
intangible items are passed from one channel members to the next. The
channel structure shows the kind of participants involved in the production,
distribution and ultimate use of the product, it shows the nature of the
linkages connecting the producer, the middlemen and consumers. A
producer can distribute his product through a variety of channels.

DISTRIBUTIONS CHANNEL FOR PRODUCT

There are numbers of alternative routes or nature of intermediaries through
which products travel on their way to final users. Depending on the
20

marketers objectives and choice of route to be used. Different routes offer

different advantages. The most frequently used channel for distributing
goods are shown in the figure below:

Producer

Producer

Producer

Producer

Producer

Agent

Agent

Wholesaler

Consumers

Wholesaler

Retailer

Retailer

Retailer

Retailer

Consumers

Consumers

Consumers

Consumers

A TYPICAL DISTRIBUTION CHANNEL FOR PRODUCT (GOODS)

A)

PRODUCER TO CONSUMER: This is the shortest, the simplest to manage

and often the quickest way to distribute consumer products. Here producer
sells or distribute its product directly to the consumer without involving any
intermediaries. The system is regarded as a direct channel.

B)

PRODUCER RETAILER CONSUMER: This is the type of channel that

is most visible to consumer producer find this channel to be economical to

21

them because it help them reduce the cost of inventory. Some producer also
have their own retailer store e.g. coca-cola Nigeria plc.
C)

PRODUCER WHOLESALER RETAILER CONSUMER: This is

often referred to as the traditional channel for most goods. This channel is
most often used by producer of drugs, hardware and final items. Product
that do not have market, need such a channel, since producer often dont
make large enough sales force to reach the mass market effectively.

D)

PRODUCER AGENT RETAILER CONSUMER: This channel shows

that some producer by pass wholesalers and employ agents to sell to
retailer. Most of the time, producer prefer to use their agents or broker to
reach retail market. Example ca be seen in the food and beverages industry.

E)PRODUCER AGENT WHOLESALER RETAILER CONSUMER: This

is the largest and the most indirect of the frequently used distribution
channels. The agent provide yet another layer of intermediaries with an
even more extensive network of contact within an attempt to reach the
small retailers producers often use agent middlemen who in turn go through
wholesalers to reach small stores impulse items have the advantage of this
channels as there are many potential buyers.

22

2.7 MANAGEMENT OF PHYSICAL DISTRIBUTION

Physical distribution is the term used in describing the integration of two or
more activities for the purpose of planning, implementing and controlling
the efficient flow of raw materials, goods and services from point of origin
to the end users.
The development of physical distribution system to support modern
marketing is a dynamic aspect for management, because an organization
constantly change part of its marketing strategy in an effort to gain and hold
a competitive advantage in the market place. In the distribution of consumer
goods for example, consumers add to his stocks by buying from retailer.
This reduces retailers inventory and eventually they place replenishing
orders with wholesalers, wholesalers in turn replenish their stock by placing
orders with manufacturers.
Thus, while products are flowing forward to the final buyers, there is a
reverse flow of orders which causes an alternating subtractions from an
addition to inventories held at each level. Each time a manufacturer ships an
order, he initiates this chain reaction in the performance of transportation
and storages. A manufacturer may centralize warehousing and shipping
activities at one or a few locations, or he may decentralize them through
warehouse operations or the use of public warehouse.

23

The development of physical distribution system to support modern

marketing is a dynamic aspect for management, because an organization
constantly change part of its marketing strategy in an effort to gain and hold
a competitive advantage in the market place. In the distribution of consumer
goods for example, consumers add to his stock by buying from retailer. This
reduces retailers inventory and eventually they place replenishing orders
with wholesalers, wholesalers in turn replenish their stock by placing orders
with manufacturers.
Thus, while products are flowing forward to the final buyers, there is a
reverse flow of orders which causes alternating subtractions from an
addition to inventories held at each level. Each time a manufacturer ships an
order, he initiates this chain reaction in the performance of transportation
and storage. A manufacturer may centralize warehousing and shipping
activities at one or a few locations, or he may decentralize the through
warehouse operations or the use of public warehouse. Furthermore, in
moving goods from one distribution point to another, these factors present
to some extent in any distribution system, make managing physical
distribution an extremely challenging task within the framework of
marketing management. The solution is the one that strokes an optimum
balance between cost incurred for physical distribution activities and
expectations of end buyers and users of the product. Managing physical
24

distribution, may be thought as a balance of distribution cost against an

acceptance of customer satisfaction.
Physical distribution management is concerned with the flow of goods from
the receipt of an order until the goods are delivered to the customer. In
addition to transportation, physical distribution management involves close
liaison with production planning, purchasing, order processing, material
control and warehousing. All these areas must be managed so that they
interact efficiently with each other to provide the level of service that the
customers demands and at a cost that is affordable.

2.8

COMPONENTS OF PHYSICAL DISTRIBUTION

Physical distribution consists of a set of activities that serve to move
product in such a way as to create time and pace utility. These activities
involves the movement of product from manufacturer to consumers. They
also include the movement of raw materials from originators to processors.
Although a long list of activities could be prepare, it is convenient to group
the activities into four areas or activity centre. Physical distribution
therefore seems to consist of four major components. These four elements
are inter-related and what occurs transportation, inventory, communication
and warehousing.

25

TRANSPORTATION
Transportation involves the physical movement of goods from the end of
production to the market. It is a necessary and important marketing activity
because it address time and place utility to a product by moving it from
where it is made to where it is purchased and used. The choices of
transportation carriers affect the pricing of product, delivery performance ad
condition of the goods when they arrive, all of which affect customer
satisfaction. In shipping goods to its warehouses, dealers and customers, the
company can choose among four main transportation modes each with
distinct cost and service characteristics such as capability, capacity,
dependability, reliability and damage accessibility are issues that should be
taken into consideration.

RAIL ROADS
Rail rods usually carry heavy, bulky items over fairly long distance. Their
predominant charges been coal, farm and forest product. They can carry
items that wont fit in trucks or that exceed highway weight limits and their
routes are more extension than those of water carrier or air carrier.
ROAD CARRIER (TRUCKS)
26

A lot of shippers are increasingly using motor trucks, motor truck account
for the largest portion of intercity transportation, trucks are an efficient
mode of transportation, they are often faster than rail especially for short
distance but are sensitive to interrupting bad weather. Trucks are highly
flexible in their routing and time schedule.
AIR CARRIERS
Air carriers transport less goods than any of the transportation modes. They
are an important transportation mode. Air freight rates are much higher than
rail and trucks rates, but air freight is idea when speed is needed or distant
market have to be reached. Among the most frequently airfreight products
are perishables (fresh fish, cut flowers) and high value, low bulk items
(technical instrument, jewelry). Companies find that air freight also reduces
inventory levels, packaging costs and number of warehouses needed.
WATER CARRIERS
A substantial among of goods are moved by ships, largely on coastal and
inland waterways. Although the cost of water transportation is very low for
shipping bulky, low value, non-perishable products such as sand, coal,
grain, oil and metallic ores. Water transportation is the slowest mode and
may be affected by the weather.

INVENTORY
27

Inventory level represent another major type of physical distribution

decision affecting customer satisfaction and transaction. Here, managers
must maintain the delicate balance between carrying too little and carrying
too much. With too little stock, the firm risks not having products when
customers little stock, the firm risk not having products when customers
want to buy. To remedy this, the firm may need costly emergency shipments
or production, carrying too much inventory results in higher than necessary
inventory carrying costs and stock obsolescence. Thus, firms must balance
the costs or carrying larger inventories against resulting sales and profits.
Inventory management decisions must make two considerations i.e. sales
considerations and cost considerations.
COMMUNICATION
Communication could be said to be the flow of important and meaningful
information, perception and understanding between various parts of an
organization channel networks. Companies manage their supply chains
through information. Channel partners often link up to share information
and to make better joint logistics decisions. From a logistics perspective,
information flows such as customer transactions, billing, shipment,
inventory levels and even customer data are closely linked to channel
performance. The company aim to design a simple, accessible, fast and
accurate process for capturing, processing and sharing channel information.
28

The type of communication system installed will depend on the available

technology and in the volume of goods flow.
WAREHOUSING
Production and consumption cycles rarely match. So most companies must
store their goods while they wait to be sold. The storage function
overcomes differences in needed quantities and timing, ensuring that
products are available when customers are ready to buy them. A company
must decide on how many and what types of warehouses it needs and where
they will be located. The firm might use either storage warehouses or
distribution centre. Some advantages inherent with warehouses area; to
even out the seasonal factor in production or sales, to obtain economies in
other business operations, and to improve product quality and value.
Warehousing is not entirely about storage, other functions performed by
warehouses includes:
a)

Receiving goods and assuming responsibility

b)

Identifying goods by keeping appropriate records of goods received,

and marking with a physical code, tag or label

c)

Sorting goods into appropriate areas of storage

d)

Marshaling shipment

e)

Dispatching the shipment

29

REFERENCES
A.B AKPAN (2003): Introduction to marketing 1st edition, published by
Isola Ola and sons, Zaria.
A.B Akpan (2005): Marketing strategy concepts and application, 2nd edition.
Published by; Isola Ola and Sons, Zaria.
A.K Arowomole, C.A Ademola (2000): Theory and practice of modern
marketing. Published by; Sodipe Nig. Ltd. Mushin, Lagos State.
Ayuba Bello (2003): Marketing principles and management: Shukrah
Kaduna 2nd edition.
J.U Anyaele (2002): Comprehensive economics for senior secondary
schools, glance series, A. Johnson publishers Ltd.
Osuagwu (2002): Marketing principles and Management 2nd
edition.
M.O Sanusi (2003): Fundamentals of modern marketing publishing:
Hamby trends Nig. Ltd. Offa, Kwara State.
N.G Nwokoye (2003): Modern marketing for Nigeria principle and
practice. 2nd edition, Africana best publisher Ltd.
P. Kotler and G. Armstrong (2015): Principles and Marketing 13th
edition, Pearson prentice hall.
30

P. Kotler and K.L Keller (2006): Marketing management 12th edition,

Prentice hall, New Delhi, India.
Santo J. (2000): Fundamental of marketing principles and application.
2nd edition, John Maxwell publisher.

31

CHAPTER THREE
RESEARCH DESIGN AND METHODOLOGY
3.0

INTRODUCTION
This chapter deals mainly with the various data collection, procedures and
statistics to the research. Other area looked into the sources of data,
population of the study, sample size, research instruments, questionnaire
design and collection.

3.1

SOURCES OF DATA COLLECTION

The two basic types of data collection method used by the researcher in this
research work are primary and secondary sources.
PRIMARY SOURCES: For the purpose of this project, the primary data
collected

was

through

interview,

observation

and

administering

questionnaire. This method was used because it is first hand information

that contained original works.

SECONDARY SOURCE: This project work also used the secondary

source of data collection because it is not costly. It is reliable, consistent and
above all, it is quickly available. This secondary source of data are second
hand information that are modified, selected and re-arranged for the

32

purpose. They involve government publication, periodicals and articles on

various business concert.

3.2

RESEARCH INSTRUMENTS
The researcher had used various instrument in his attempts to gather
relevant data to the scope of the study and the limitation posed by the
process of data collection questionnaire tends to serve as the more creative
instrument in this research. The researcher, however, did not undermine the
significant application of interviewing and survey which he put into use
effectively.

3.3

QUESTIONNAIRE DESIGN
The researcher designed a questionnaire in designing the questionnaire used
in this study, the researcher applied the use of closed form of questionnaire
for the purpose of simplicity and conciseness the researcher restricted the
questionnaire in this study to areas of question when
-

Respondent must be able to understood

Respondent must be willing to provide the information

A questionnaire is a document used in survey comprising some series of

question aimed at a licit certain required information. It is a method of
obtaining specific information about a defined problem so that the data after
33

analysis and interpretation of result are in a better appreciation of the

problem.

3.4

POPULATION AND SAMPLING

The term population in the content of this project works means or refers to
the entire individuals or event to which generalization are to be made.
Therefore the target population for this work is coca-cola plc Kaduna.

SAMPLE SIZE
Sample size involves taking part of the population for study in order to
drew conclusion in the entire population. This sampling techniques used for
the purpose of this project is random sampling, where every staff has an
equal chance of being chosen.

3.5

QUESTIONNAIRE DISTRIBUTION AND COLLECTION

The questionnaire designed was distributed to customers and staff of cocacola Plc. A total of fifty (50) questionnaire were distributed in twenty for
the staff and thirty (30) to the customers but only forty five (45) were filled
and returned to the researcher.

34

END NOTE
John A. Eze, V.A Onodugo (2002)Business Policy and strategic
management 1st Edition. (new York prentice Hall)

Philip Koltler (1991): Principles of marketing 6th edition (New York:

Prentice Hall).

Philip

Kotler

(1998):

Marketing

management

analysis

implementation and control 6t edition (New York Prentice Hall).

35

planning

CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
4.0

INTRODUCTION
In order to uphold some of the hypothesis already done in chapter one (1).
This chapter is devoted for the presentation and analysis of this project
work is based on the data collected from the field through primary source of
data collection, which involve the use of questionnaire. In conducting the
study, questionnaire were distributed to the sample population.

4.1

INTERPRETATION OF DATA

To test the validity or invalidity of the investigation carried out, the

interpretation of data is designed to interpret the question contained in the
questionnaire already distributed.
RESEARCH QUESTION
Table 1: Age of respondent
Option
No. of respondent
20 29
10
30 39
15
40 44
13
50 and above
7
Total
45
Source: Survey data 2015

36

Percentage
22.2%
33.3%
28.9%
15.6%
100%

RESEARCH QUESTION
Sex of respondent
Table (2)
Options
No. of respondents
Male
25
Female
20
Total
45
Source: Survey data 2015

Percentage
55.6%
44.4%
100%

RESEARCH QUESTION
Marital status
Table 3
Option
Single
Married

No. of respondents
19
26

Total
Source: Survey data 2015

45

Percentage
42.22%
57.78%
100%

The table above shows that 42.22% (10) of the respondent are Single
57.78% (26) of the respondent are Maried.

RESEARCH QUESTION
Highest educational qualification.

37

Table 4
Option
No. of respondents
WASC/ SSCE
2
ND
8
HND
10
BSE
15
MBA
7
Others
3
Total
45
Source: Survey data 2015

Percentage
5%
18%
22%
32%
12%
7%
100%

The tables above shows there Highest academic qualification of

respondents.

RESEARCH QUESTION
Years of job experience.
Table 5
Options
No. of respondents
Below 10
15
10-20
15
20 above
15
Total
45
Source: Survey data 2015

Percentage
33.3%
33.34
33.4
100%

The table above shows that 33.34% (15) of the respondent said mode of
said below 10 years, and 33.34% (15) of the respondent said mode of said
10-20years, while 33.33% (15) have worked for 20 years and above.
38

RESEARCH QUESTION
Cadre in the company.
Table 6
Options
Top Management
Middle management
Lower management

No. of respondents
8
12
25

Total
Source: Survey data 2015

45

Percentage
17.8%
26.7%
55.5%
100%

The table above shows that 17.8% (8) of the respondent said Top
Management, 26.7% (12) said middle management, 55.5% (25) Said lower
management.

39

RESEARCH QUESTION
Despondences responses on The distribution method the firm should use
more
Table 7
Options
Distribution through depots
|Distribution through

No. of respondents
36
9

resellers
Total
Source: Survey data 2015

45

Percentage
80%
20%
100%

The table above shows clearly that 80% (36) of the respondents said
Distribution through depots, while 20% (9) of the respondent said
Distribution through resellers.

RESEARCH QUESTION

40

Despondences responses on how the mode of distribution affected product

sales.

Table 8

Options
No. of respondents
Positively
36
Negatively
9
Total
45
Source: Survey data 2015

Percentage
80%
20%
100%

The table above show clearly that 80% (36) of the respondents said
positively, while 20% (9) of the respondent said negatively

RESEARCH QUESTION
The present sales in greater than the past sales?
Table 9
Options
No. of respondents
Yes
36
No
9
Total
45
Source: Survey data 2015

41

Percentage
80%
20%
100%

The table above show clearly that 80% (36) of the respondents said their sale
increase compare to the past sales, while 20% (9) of the respondent said
their sale not increase in the recent year.

RESEARCH QUESTION
Responses to the relationship between intermediaries and company sales
forces?
Table 10
Options
No. of respondents
Very good
18
Good
15
Cordial
12
Fair
Total
45
Source: Survey data 2015

Percentage
40%
33.3%
26.7%
100%

The above table shows that 40% (18) of the respondents said they are
having very good relationship with the company sale force, 33.3% (15) said
the relationship is good, while 26.7% (12) said the relationship that they an
having cordial relationship with the company sales forces.

RESEARCH QUESTION

42

The responses in the quality of coca-cola plc product compare to that of

competitors?
Table 11
Options
No. of respondents
Very good
16
Good
22
Fair
7
Poor
Total
45
Source: Survey data 2015

Percentage
35.6%
48.8%
15.6%
100%

The table above shows that 35.6% (16) of the respondents, said coca-cola
product is very good compare to competitors, 48.8% (27) said their product
is good compare to competitors while 15.6% (7) said coca-cola product in
fair compare to other competitors.

RESEARCH QUESTION
Respondents responses on How the Price of the product farced in the
market

Table (12)
Options
Quite competitive

No. of respondents
12
43

Percentage
26.&

Just competitive
At per with others
Undecided
Total
Source: Survey data 2015

27
4
2
45

60%
8.9%
4.4%
100%

The above table shows that 26.7% (12) of the respondents said Quite
competitive, 60% (27) said Just competitive 8.4% (4) said they at per with
others, while 4.4 (2) an undecided.

RESEARCH QUESTION
Respondents Responses on how the company should improve on its
distribution.

Table (13)
Options

No. of respondents
44

Percentage

Open more sale deports

Increase numbers of major
distributors
Increase the first size
undecided
Total
Source: Survey data 2015

7
18

15.6%
40%

9
11
45

20%
24.4%
100%

The table above shows that15.6% (7) of the respondent said the Open more
sale deports 40% (18) said Increase numbers of major distributors, 20% (9)
said Increase the first size, while 24.4% (11) said undecided.

RESEARCH QUESTION
Respondents responses on the way effective distribution enhance
marketing of goods and services
Table (14)
Options
No. of respondents
Quiet significantly
36
Significantly
9
Total
45
Source: Survey data 2015

Percentage
80%
20%
100%

The table above shows clearly that 80% (36) of the respondents said Quiet
significantly, while 20% (9) of the respondent said significantly.
45

RESEARCH QUESTION
Effective distribution does not enhance significantly an organizations marketing of
goods and service
Table 15
Opinion

Top

Middle

management management
Yes
13
7
No
7
5
Total
20
12
Source: Survey data 2015

4.2

Lower

Total

management
10
3
13

30
15
45

TEST OF HYPOTHESIS
With proper understanding and careful analysis of the previous researcher
test of hypothesis and facts put together by the researcher to make the study
more clear. The question are laid into hypothesis, as can be seen in chapter
one (1).
In testing hypothesis, the researcher assumed 5% (0.05) level of
significance and chi-square distribution used as test statistics.

HYPOTHESIS

46

This hypothesis state that effective distribution does not enhance

significantly an organizations marketing of goods and service.
. To test this hypothesis table (4.15) is hereby reproduced to show the level
of responses.
Table 16
Opinion

Top

Middle

management management
Yes
13
7
No
7
5
Total
20
12
Source: Survey data 2015

Lower

Total

management
10
3
13

30
15
45

X2 = (O e)2
e
Where:
X2 = chi-square
= summation sign
O = observed frequency
e = expected frequency
Expected frequency = row total x column total
Grand total
For Yes row
X2 = 30 x 20
47

45

13.33

3.67

X2 = 15 x 20
45

6.67

X2 = 15 x 13
45

4.33

X2 = 30 x 13
45

For No row

X2

15 x 13
45

CONTINGENCY TABLE
Opinion
Yes
No

Top management

13(13.33)
7(6.67)
Source: Survey data 2015

Middle

Lower

management
7(8)
5(4)

management
10(8.67)
3(4.33)

Observed frequency = X2 = (O e)2

e
X2 = (13 13.33)2
13.33

= 0.081

X2 = (7 8)2
48

= 0.125

(10 8.67)2
8.67
(5 4)2
4

= 0.204

= 0.25

(3 4.33)2
4.33

= 0.408

X2 = 2.39
Degree of freedom:
(r 1) (C 1)
r = No. of rows
C = No. of columns

D.F = (3 1) (2 1)
D.F = (2) (1)
D.F = 2

DECISION RULE
Since the calculated value of X2 is 2.39 which is greater than critical value
of 5.99, we reject the null hypothesis (Ho) at 95% confidence and accept
49

the alternative hypothesis (Hi) and then conclude that; physical distribution
increase an organization market share.

4.3

RESEARCH FINDINGS
Having analyzed the data and tested the hypothesis the following findings
were made.
a.

The result of the analysis has indicated that physical distribution

helps in increasing sales volume.

b.

Physical distribution should be properly maintained, this will lead to

increase in efficiency, effectiveness and productivity.

c.

There should be proper and adequate supervisions of physical

distribution as this lead to their development and expansion of the
organization.

d.

There is clear indication that the relationship between the sales force
and middlemen is very cordial.

e.

It has also indicate in the analysis that coca-cola plc, uses marketing
intermediaries in distributing their product.

f.

Customers are satisfied with the price of the coca-cola plc product.

50

CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
5.0

SUMMARY
Business organization comes in different nature. Whatever the native, form
or size their most important task is satisfying the wants and needs of
customers. The entity must at all times try to identify the wants, needs and
interest of the target market and their determining ways and means of
satisfying them to yield benefit to both the customer and the organization.
This project work was written is chapters. There are five chapters in all,
chapter one dwelled on the background and nature of physical distribution
and market share, it also include statement of the problem, the objectives of
the study, others areas discussed in this chapter includes; scope and
limitation of the study, significance of the study and statement of
hypothesis.
Chapter two deals with literature review, which review comments,
statement and opinions made by previous person or groups as contain in
books, journals, article etc.
Chapter three highlighted the research methodology viz-a-viz population
and sample size, method of data collection, method of data analysis.

51

Chapter four deals with data presentation and analysis, finally in chapter
five, the entire research work are summarized, findings of the research are
stated and recommendation are made.

5.1

CONCLUSION
Throughout this study, physical distribution and market share has been seen
as a major component in increasing and lifting organization to the next level
in the market place. The aim of physical distribution is gathering the right
goods to the right place at the right time for the least cost. Goods have to be
moved from place of origin to the place of use or consumption. The
appropriate channel of distribution used either for consumer or industrial
goods are carefully chosen so that goods reach their destination on time and
free of damage and we have seen this example with coca-cola plc, which is
our case study.
Based on the literature review, data presentation and analysis and the
researcher personal observation, the following are the conclusion of the
study.
Physical distribution has a temporary effect in sales volume in coca-cola plc
or soft drink industry.
Physical distribution increase sales volume.

52

Coca-cola plc product are accepted and consumed by all categories of

people in the country and has it market in all communities all over the
country.
Physical distribution serves as a vital link between the manufacturer and
distributors as well as the consumers.
Physical distribution assist organization to provide time and place utility
and convenient value to present and prospective customers.

5.2

RECOMMENDATIONS
As in the case with small or developing countries today, their major
problems is insufficient and inefficient planning, organizing and
management of physical distribution activities. Based on the finding of the
research, the following recommendation are made.
The management of the coca-cola plc should invest resources in physical
distribution activities as the case will increase the sales volume of the
company thereby meeting the company objective of increasing market
share.
The company (coca-cola plc) should engage in social responsibilities or
provide some infrastructural facilities, this will give the consumer of the
product a sense of belonging thereby patronizing the coca-cola product
more.
53

The company should constantly service their truck to avoid breakdown on

the road to ensure safe delivery of goods.
The intermediaries should be given a lift or encouragement and certain
incentives to boost product in a targeted market.
However, further research can be conducted in other peculiar area with
specific reference to the distribution policies of developing companies.
Similarly research could be conducted in the area of the practice of
inventory (storage) management as it affect physical distribution of
essential consumer products in the economy.

54

BIBLIOGRAPHY
A.B Akpan (2003): Introduction to marketing 1st edition, published by
Isola Ola and sons, Zaria.
A.B Akpan (2003): Marketing strategy concepts and application 2nd
edition, published by Isola Ola and sons, Zaria.
A.K Arowole, E.A Ademola (2000): Theory and practice of modern
marketing 1st edition, Sodipe publisher Nig. Ltd. Lagos.
Ayuba Bello (2003): Marketing principles and management, 2nd
edition, Shukrah Kaduna.
E.O Oni, L.O Adedeji (2006): Research methodology in the social and
management science 1st edition, Adlek printer Iree, Osun State
J.U Anyaele (2002): Comprehensive economics for senior secondary
schools, Glance series. A Johnson publishers Ltd.
Luis Osuagwu (2002): Marketing principles and management, 2nd
edition.
M.O Sanusi (2003): Fundamentals of modern marketing 1st edition,
Hamby trends publisher Nig. Ltd. Offa, Kwara State.
N.G Nwokoye (2003): Modern marketing for Nigeria principles and
practice, 2nd edition, African best publisher Ltd.
55

P. Kotler, G. Armstrong (2015): Principles of marketing 13th edition,

Pearsons prentice hall
William J. Stanton (1982): Fundamental of marketing 2nd edition,
Grain hall book company, New York.

56

APPENDIX A
Department of Marketing,
Federal Polytechnic,
P.M.B 001, Nasarawa
Nasarawa State
July 10, 2015
Dear Sir/Madam
This questionnaire is designed to find out the essence of physical distribution in
extension of market share (a case study of coca-cola plc Kaduna). It is purely an
academic exercise in partial fulfillment for the award of national diploma in
marketing from the federal polytechnic Nasarawa. The data will be used for the
purpose of research towards the advancement of knowledge.

Yours faithfully

MUSA ABDULRAHMAN

57

APPENDIX B
Please tick ( ) as responses to questions except where title comment might be
necessary.
1. Age of respondent (in years)
a. 20 29

b. 30 39

c. 40 49

d. 50 and above

a. Male

b. Female

a. single

b. married

2. Sex of respondents

3. marital status

4. Highest educational qualification?.

f.

a. WASC/SSSC

b. ND

c. HND

d. BSC

e. MBA

Other

]
58

5. Years of job experience ?

a. below 10 years

b. 10-20 years

c. 20years above

a. Top management

b. Middle management

c. Lower management

6. Cadre In The Company?

7. which distribution method do you think the firm should use more?
a. distribution through deport

b. distribution through resellers

8. how has your mode of distribution affected products sales?

a. Positively

b. Negatively

59

9. Is your past sales greater than your present sales

a. Yes

b. No

10.

How is your relationship with the companys sales force?

a. Very good

b. Good

c. Cordial

d. Fair

11.

How would you compare coca-cola with that of competitors?

a. Very good

b. Good

c. Fair

d. Poor

12.

How has the price of the product fared in the market?

a. Quite competitive [

b. Just competitive

c. At per with others [

13.

How should the company improve on its distribution?

a. Open More sales Depot

b. Increase numbers of major distributors

60

c. Increase the firs size

d. Undecided

14.

In which way should effective distribution enhance marketing of goods and

services?

a. Quite significantly

b. insignificantly

61