Documenti di Didattica
Documenti di Professioni
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By:
Daniel Tsegaye
June, 2005
In management
Preface
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Acknowledgement
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Tables of contents
Page Number
Preface 2
Acknowledgement 3
Tables of contents 4
List of tables and List of figures 5
Section I 1. Introduction 6
1.1 Background of the study 6
1.2 The statement of problem 7
1.3 Objective of the study 8
1.4 Significance of the study 9
1.5 Methodology of the study 9
1.6Sampling methods and procedures 10
1.7 Scope and limitations of the study 11
1.8 Study organization 11
1. Time schedule 12
Section II 2. Literature review
2.1Conceptual definitions of consumers 13
2.2 Market Segmentation and Customer Benefit 17
2.3 Customers, service, and satisfaction 19
2.4Consumer interest and distribution 26
Section III 3.Data Analysis and interpretation
3.1 Settings of the study 27
3.2 General overview of the study 32
3.3 Basic findings and data analysis 41
Section IV 4. Recapitulation of the study
4.1 Discussion summary 58
4.2 Study conclusion 59
4.3 Recommendation 64
Bibliography 66
Appendix
Page Number
List of tables
Table 1.1Selected factories and distributor 10
Table 1.2 Project work time schedule 12
Table 3.1 the major outputs and annual production capacity 30
of the eight state owned textile factories
Table3.2 Qualities of the distributors 34
Table 3.3 Personal Profiles of Respondents 35
Table 3.4 Products and their nominal and unconscious benefit 43
Table 3.5 Respondents ‘opinion vs. purchase criteria. 46
Table 3.6 Textile demand among the regions 52
Table 3.7 Textile demand among the Cities 52
Table3.8 Ethiopian Family consumption decisions on textile 57
Table 4.1 Consumers Profile 59
Table 4.2 Consumers preferences to products,
price advertisement and distribution. 61
Table 4.3 family’s role in purchase Decision 61
Table 4.4 marketing mixes 62
Table 4.5 Grouping consumers in to meaningful buyer group 63
List of figure
Fig 3.1 Trade and distribution channels for
textile in Ethiopia (Tailored to the study) 39
Section I
1. INTRODUCTION
1.1 Background
Paving the way to reach at the needed point of being developed country, it
is unquestionable task to use scarce resources of a nation effectively and efficiently. In
this regard, what it comes immediately to individual’s mind is the Ethiopia has to utilize
Agricultural product parallels to huge potentials of human resources. The miracle here is
that Agricultural products of our country are organic. It asks to contemplate in wise to use
and properly consume this treasury.
These efforts becoming on - going of practicing, all concerned bodies must put
their endeavors thought their activities.
Of many struggles and as we have high demand in domestic market as well as
getting different incentives from western countries like exempted of duty free and free
from all quota restrictions, the textile industry in the country is a very attractive
investment.
Moreover, it plays a key role in the country’s economy. Ethiopia’s textile and
garment industry covers 105 of the gross valve production. The reputation of this sub
sector is accommodated 30% of the total work force employed by the industry sector.
However, the sub sector has urgent soluble problems. According to the document
prepared by Ethiopia Export Promotion Agency, solving this problem is a question of the
survival of the industry.
It says” to be competitive in international market as well as locally, fulfilling the
quality type, price and preferences requirements of the customer are the one and only
one. And to attain all these, enhancing the capacity of the sector is the necessity”. (Source:
Ethiopia Export Promotion Agency 2003)
Thus, an increasing amount of attention has recently been given to the textile
industry by government. The attractive incentives include an income tax holiday for a
period of five to six years and exemption from the payment of import custom duties and
many other considerations are given.
• To what extent the marketing strategies shaped and reshaped according to the
consumer preferences in existing textile products.
• Do the target customers and the market mix need to redefine.
• To search the contemporary consumers needs and wants
• How does effective marketing take advantage of knowing consumer needs, and
contribute to increase of product demands.
• What attempts will be made to improve products to desirable in competitive
market?
• What are some of the decisive buying factors that lead consumers to experience
feelings of satisfaction and dissatisfaction?
• Are consumers (users) satisfied in the already existing textile products?
• What are the relevant requirements of consumers to meet their entire needs of
consumers?
• What do customers expect?
• What action can companies take in the light of consumer preferences?
• Is the distribution and marketing of textiles the most profitable of other industrial
products? (To assess the)
• Importance of textile for distributors, their capacity and profitability and
attractiveness of the sector?
• How do distributors act to stimulate customer interest in the product of their
suppliers?
1.3 Objective of the study
The foremost objective of the study is to examine and review consumers'
preferences for textiles. Based on this, target market can be easily well-formulated. It can
also produce a strong customer satisfaction. This is the best achievable aim to be the part
of the rapid world and to be competitive in open global market.
Moreover, the study has the following objectives:
-
- It helps to know the contemporary consumer needs and wants
- To assess the level of participation of the consumers and distributors in the
identification, modifying, and improvement of products.
- To assess how the consumers and being interested to the benefit of the textile
industry.
- To see the future respects of the industry and treatments of consumers.
- To identify the major problems that are encountered in the textile products
related to users preferences and to recommend remedies to solve the problems
identified, if any.
1.4 Significance of the study
The primary beneficiaries of the study are not confined to textile companies and
distributors, but consumers. They are highly and original holder of a benefice on this
study.
A primary reason for studying consumer behavior is to make out bases for
effective segmentation. Thus, the study will play a key role to segment market. This idea
becomes strong based on stern and studivant on their article. They write "the first step
calls for researching what customers want from the buying process and then using their
preferences to group customers in to Market Segments. (Stern and studivant, 1987)
They also put what researchers can do on their best findings.
"Researchers can group these preferences in to market segmentation . . ."(Ibid)
and observation. As the study is empirical research, the observations will be checked and
tested by collecting relevant data and information. At last, the research will come up with
conclusions. The maximum magnitude of the research will help for the managers in
decision-making.
The sample will be drawn from the eight textile factories, which the country has,
out of which the study will take three of the factories.
The sample frame, i.e., the listing of all distributors will be obtained from selected
plants. The site of the distributors will consist two distributors from each of the three
selected factories. This will bring the sample size to six.
The study will cover private distributors, which are engaged only in textile
market. The following table shows from where the selected distributors are taken.
Direct observation
Since the research involves consumers, direct visit of market places is important. In
addition, marketing departments of factories have targeted for different purpose in the
vein of preparation of questioners and to know more about distributors.
Based on the proposal of the study, which in detail explains all the project work,
the study's sections are organized. Resting on this, section I is a part of the course of
action in that the study has.
Section II will try its unsurpassed to enclose review concepts and theories and
review previous research findings. It gives consideration on customers' services versus
distribution as well as distributor's participation, satisfaction, and more on related
concepts.
By the directory of the study design, relevant data and information will be
presented and analyzed in section III in brief and striking comportment. The efforts of the
study will appear in section IV. It undertakes to scrutinize the portion of the target area
and will put some remarkable results. These ideas will be concluded and got suggestion
in section V. "As the Twig is Bent, So Grows the Tree"
Richard E.Byrd
* It * It helps to prepare preliminary questionnaire. The study has aimed to select one from the sample drawn.
Section II
2. LITRATURE REVIEW
The aim of this section is to review some of the important literatures related to the
study. Due to different problems in our country, it was very difficult to collect relevant
and adequate information. However, it has been tried to review some basic conceptual
literature as well as research findings from different Journals.
This section, therefore, includes conceptual definitions, consumer behavior,
distributor's characteristics; consumer satisfaction, distributor participation, delivery
service and its prospects, and others related concepts. It also consists review of empirical
research works in related areas.
2.1Conceptual definitions of consumers
The term 'consumer' is defined to mean the end user, "Who is not necessarily the
customer. Take the example of a mother or father who is buying breakfast cereals. The
chances are that they are intermediate customers, acting as agents on behalf of the
eventual consumers (their family) and, in order to market cereals effectively, it is clearly
necessary to understand what the end consumer wants, as well as what the parents want.
"(MCDONALD, 2002:106) so, consumer is a person who consumes or uses a product.
But, a customer is a person who buys products from a market. For example, Distributors
are customers, not consumers.
"The term consumer is often used to describe two different kinds of consuming
entities: the personal consumer and the organizational consumer: The personal consumer
buys goods and services for his or her own use (e.g. sharing cream or shampoo), for the
use of the household (a VCR), or as a gift for a fiend (a book). "The second type of
consumers" buys products, equipment, and services in order to un their organizations.
"(Schiffman and kanuk, 1997)
2.1.1Consumer Behavior
Why we study it and its perspective
Marketing starts and ends with the consumer from determining consumer needs to
providing consumer satisfaction. Therefore, a clear understanding of consumers is crucial
in successful marketing.
present and that cognitive activities occur. Finally, the first situation is characterized by
haring more than one acceptable alternative.
Thus, when we talk about a choice, three aspects can be identified:
There must be two or more choice alternatives.
The choice alternatives must arouse a certain amount of conflict.
Cognitive processes aimed at reducing the conflict must occur.
Choice is characterized by conflict, uncertainty, and cognitive activity, and related
psychological processes can be observed. Situations of this kind occur, however, where
we do not talk about choices in any narrow sense at the word. Fore example, this is the
case when the individual is '' thinking '' or exposed to information. When he is reading,
listening to a message, or talking, conflict, uncertainty, and cognitive processes occur. All
these stations have a number of things in common (Hansen, 1972 b), and they have been
labeled '' conflict situations, ''since in all of them the individual is tiled with certain
amount of uncertainty and conflict.(Hansen, 1976:117)
David Mercer and Dr. Richard Mole wrote factors that influence buying behavior.
"A customer does not always come to each buying decision with an open mind, and
then rationally consider the options. For instance, any notion that price is the only
important criterion is clearly wrong. In reality the decision making process is extended,
complex and often confused. A wide range of factors, for example, may influence
customer goods and services,, such as:
• Economic factors Social class Peer pressure
• Age Occupation Lifestyle
• Geography Culture Diffusion of innovation
(Mercer and Mole, 1996:6)
as much to acquire new customers each period. Satisfied customers are likely to buy
more frequently and in greater volume and purchase other goods and services offered by
the firm." (Lechmann and Forneu, 1994) they further added that the more loyal customers
become, the longer they are likely to continue to purchase from the same supplier. (ibid)
The concept of satisfaction "is an emotional response that dictates the behavior and
actions of a customer's purchasing abilities. Those products and services that provide
satisfaction are likely to be purchased in the future. Given its attitudinal component,
satisfaction is readily defined as the different between what a customer expects and what
he or she perceives to occur. Therefore, managing these expectations and perceptions
becomes critical for all businesses to maintain customer satisfaction and provide a unique
and lasting quality experience. 'McLaughlin also stated that' satisfaction, as described,
can not be fully measured. Evaluating satisfaction requires a measurement of customer
expectations, perceptions, altitudes, bias, past experiences, and likes and dislikes.:
(McLaughlin, 1998:173 – 174)
He also added "satisfaction is greatly affected by environmental factors, previous
outcomes and experience, bias, warnings, and pre-and post-consumption feelings and
attitudes. In order to me, the manager must identify and measure the sources (causes) of
both satisfaction and dissatisfaction." (McLaughlin, 1998:173 – 174)
"Product selection is in part determined by the anticipated satisfaction with that
product. Consumers wonder if the purchase will turn out 'good' or 'bad', if the product
will work or not, whether he or she will be 'satisfied' or 'dissatisfied', if is inconceivable
to argue that this inference is not determinant of product choice in virtually all instances
in which consumer decisions are made.
What determines the expectancy of 'success' or the subjective like hood of personal
satisfaction for each of a number of alternatives? Before any initial choice, the
antecedents of expected satisfaction are numerous and primarily non-attribution. For
example, I may purchase a particular product because it is first on the list in consumer
Reports, because a friend speaks highly of it, because I am convinced by an
advertisement, and on and on."
Dhar studied on consumer preference for a No-choice option.
'' Consumers often face situations that require choosing among several alternatives
in the marked place. The traditional focus in the decision-making literature has been an
understanding how people choose among a given set of alternatives. In reality, many
decisions involving choice among several desirable alternatives can be difficult and give
way to a more fundamental kind of preferences the decision whether or not to choose. A
recent analysis of a sample of consumers finds that the difficulty of selecting a single
alternative was one of the most important causes for delaying a number of purchase
decisions (Greenlent and lehmann 1995)" (DHAR, 1997)
2.3.1 Customer Service
"Factors which impact on customer service include;
Frequency of delivery
Time from order to delivery
Emergency deliveries when required
Accuracy of paper work
Stock availability
Reliability of deliveries, etc." (McDonald 2001:408 – 409)
Stewart also started that "consumer service measurement relates of the speed and
consistency of servicing orders in comparison to a standard of product availability."
(Stewart, 1965)
Stern and studivant also advised as follows:
"Managers conducting the research concentrate on learning what their ultimate
customers the end users want in the way of service. It is these people, of course, who
actually benefit from the products a company makes." (stern and studivant, 1987)
Generally, "The measure of physical distribution performance is the relation
between customer service capability and associated total cost." (Bower sox, 1972)
According to stern and studivant, "service fall in five categories"
- Lot size (buy unit or multiple unit)
- Market decentralization (distance far, near)
- Waiting time (immediate delivery or assurance of delivery)
- Product variety (choice of many related products or do they prefer the store to
specialize)
- Service backup (repair immediate, wait for local repair service) (stern and
studivant, 1987:34)
2.3. 2Customer complaints
Lewison and his friend assured that "the rights to be heard and to be informed are
key factors in the customer complaint process."
They also put: "Most customer complaints result from one of the tree general
causes:
Product related:1.1 poor quality products
1.2 Damaged products
1.3 Incorrect products
1.4 Insufficient products
Service related causes involve customer dissatisfaction with sales personnel and
services such as checkout, delivery, workroom, and customer accounts.
Customers make mistakes: sometimes they are international, sometimes they are
not customer mistakes are also a cause of customer related complaints. "(Lewison
and Delofier, 1989:460)
Finally, based on Lewison and his friend, "the more common service objectives are to:
Increase from utility
Facilitate time utility
Enhance place utility
Promote possession utility
Increase consumer convenience
Create a desirable store image
Provide customer security
Increase store traffic
Establish a competitive position, and
Build demand (ibid, page 463)
2.3.3Distributors and consumers
Whatever the product is attractive and has cheap price, end users should be able to
get it with right quantity on the right time from the right supplier. Otherwise, excellent
product with reasonable price will be invisible or out of the market. So, a distributor has a
crucial effect and has a key role on consumer satisfaction as well as company's profit.
From Harvard Business Review, Narus and Aderson, strengthen this idea on the portion
of disseminating products:
"An recent McGraw-Hill Survey found that only 24% of all industrial marketers sell
their products directly to end users exclusively; the remaining 76% use some time of
intermediately of which industrial distributors are the most prominent." (Narus and
Aderson, 1986)
In 1976, "International Management" Magazine has indicated similar explanation by
the title" selecting the right Agent":
"An Agent an individual or organization given the right to market a manufacturer's
products in a specified territory does not represent a sizeable investment of the company's
money. Indeed, that is why many companies employ agents rather than set up their own
branch sales offices. But nonetheless an agent can have a crucial effect on the company's
performance." (Buck, 1976:18)
Luck has also conducted similar study on Journal of marketing in 1969 as follows;
"Wholesalers and retailers play major roles in the market success of products which
they distribute. Relatively small shifts in shelf facings, out of stocks, displays, and other
dealer support may produce favorable or dangerous friends. A significant portion of the
product distribution strategy may be aimed at the distributors themselves to stimulate and
maintain their interests through special programs, sales aids, and other trade promotion.
Often the product managers concern includes monitoring the inventories in the pipelines
in order to control production rates." (Luck 1969)
Before 35 years, Lopota stated that:
"The last two decades have made if clear that we can not do a way with the
economic functions of wholesaling and distribution, and that, more than ever before, . . . "
(Lapota, 1969)
On the other hand, David Arnold said the need of distributors in an emerging
market as follows:
"An established corporation looking for new international markets makes a foray
in to an emerging market, carefully limiting its exposure by appointing an independent
local distributor." (Arnold, 2000)
Before seven years ago, Murry and Heide suggested Determinant factors of
participation. According to them, "The three general mechanisms for structuring
relationships between parties are motivated by self interest. These are: -
o Interpersonal attachments
o The use of incentives
o Monitoring efforts, intended to reduce information asymmetries that other wise might
permit non compliance." (Murry and Heide, 1978)
Of the three mentioned factors, the use of incentive is a highly motivated factor that
encourages efficient physical distributions system. From Michigan state university, two
writers, shimaguchi and later, had concepts on the benefits of forming relationship. They
pointed out that:
"Basically, rebates are provides as incentives for distributors originally, a rebates was
deemed to be a portion of the business profits returned to distributors to motivate them to
purchase and sell a manufacturer's products." (Shimaguchiand later, 1979)
They also added "It has proven to be a powerful method by which manufacturers can
motivate, stimulate, attract, and control distributors under conditions of keen
competition." (Ibid)
"Distributors, in turn, believe they will receive the largest rebates if they demonstrate
great loyalty to their suppliers." (IBID, 1979)
Lewison and Delozier stated that: "Based on the number and type of functions,
wholesaling intermediaries fall in to several groups." These are: -
Merchant intermediaries
Full function General merchandise, specialty line and Single line
Limited function Cash and carry, Truck distributor, Drop shipper and Rack
Jobber
Agent Intermediaries
Limited function Broker, Manufacturer’s Agent, Sales Agent, and
Commission Merchant and Auction House
Contractual Intermediaries Full or limited function (cooperative group and
Voluntary chain)
(Lewison and Delozier, 1989:471 – 473)
SECTION III
DATA ANALYSIS AND INTERPRETATION
3.1 Background of the study
INTRODUCTION
This consumer’s preferences survey presents a side view of the local consumers
for textile (including cloth) in Ethiopia.
The stress of the surveys lies on those products, which are of imperative for
domestic manufactures and online business partners. It is a key national concern to boost
the industry with in basic strategic of the country. The survey includes contact details of
distributors in particular emphasis and some sales persons and customers' informal
contact in general. The study depends on secondary data (data that have been published
earlier) and primary data (information that collected on the study).
This study has also tried to identify what types of textile consumers prefer to buy;
why they prefer it; where they buy it; and how often they buy it. It has been also
considered what kind of consumers buy textile? What do they look for? The answers to
these questions found through this study for textile.
Although this study focuses how and why local consumers make decisions to buy
products, the commitment goes for beyond these factors of consumer’s preferences. It has
been done selected survey on what they expect from local products and what they
response for imported products. Be it known, all of these questions have been solved
through distributor opinion.
In this survey, it has not been tried to study organizational consumers rather
individual. Ethiopian consumers who buy goods and services for their own use or for
household use are given privileged attitude of their display in searching for, purchasing,
using, evaluating and disposing of products, services, and ideas.
- Macro economic indicators of the performance of the economy during the 1990s
give an overall picture of a declining tends of poverty. GDP grew at an annual
average rate of close to 5% during 1992/93 –2000/01.
- During the period 1992/93 – 2001/02, GDP per capital has been growing by 2.7%
per annum.
- Over the period of 1995/96 to 2000/01, 262 foreign investment projects received
certificate, of which 56 have become operational.
- Gross enrolment for both sexes at primary level increased from 35% in 1995/96 to
51% in 1999/2000.
- Generally, the new economic policy took the creation of an enabling environment
for both domestic foreign private investments as one of its objectives.
- Besides these good achievements, the document has indicate the following
challenges:
- Households with larger family sites, low lowers of literary louder heads of
household are more likely to fall into poverty than those with smaller family sites,
higher levels of literals, and younger heads of household
Source: Ministry of Finance and Economic Development of Ethiopia: SDPRP July 2002 A.A
1. Social indicators
Population (total), in millions 67.2 69.1 71.1
(O/w urban population, in %) 15.3 15.5 15.8
Working age population/in millions
Urban 6.4 6.5 7
Rural 29.8 30.54 31.4
Total 36.2 37.04 38.4
Source: Ethiopia Export Promotion Agency –The study on Ethiopia Textile and Apparel sub-sector
Product characteristic
Product group of the study
This analysis of textile includes bed linen, cloth, poplin, Towel, twill, drill gray and yarn.
Bed linen:
It is the most important market for household textiles. It includes bed
sheets, pillow covers and blankets (excluding electric blankets) functions
of bed linen are to protect the bedding, to enhance “Sleeping pleasure”
and an aesthetic appeal.
Cloth:
It includes men’s clothing, women’s clothing, T-Shirts pullovers and
babies clothing.
T-shirts can be used for many purposes. Functions vary from outwear
(plain, striped, printed) under wear (mainly plain while, part of a sport-out
fit) plain with logo to night wear (over sited). It is know that about 90% of
T-shirts is made of cotton. T-shirt is a colorless short-sleeved or
sleeveless usually babies clothing cotton
undershirt, also, an outer shirt of similar design.
Poplin: - cotton, wool, and other textile fabrics, crosswise rib. The filling is
cylindrical. Two or three times as many warp as wetter per inch has a
more pronounced filling effect than broad cloth. It is mercerized and has
quite a high luster. If may be beloved, or duded usually vad dyes are used
or printed. Heavy poplin is given a water repellent finish for outdoor as
organize made with silk warp and or a heavier wool filling. Some also
mildew proof, fire- retardant, and some given suede finish. American
cotton broad cloth shirting is known as poplin in Great Britain.
Towel: Absorbed cloth used for drying after washing. (Oxford Dictionary of current
English 1998:966)
Twill: A fabric with a twill wearer namely a textile weave in which the filling
threads pass over one and under two or more warp threads to give an
appearance of diagonal liner.
Drill: A durable cotton twilled fabric. Twill Left hand twill from top left to lower
right L2/9 or L 3/1 closer, flatter Wales that gabardine. Medium weight
and course yarns are used. Also made in some other weights some left in
the gray but can be bleached old dyed. When dyed a Khaki color it is
known by that name. (Another definition for drill): strong cotton
material similar to denim which has a diagonal 2 x 1 weave running up
ward to the left selvage called Khaki when dyed that color used for
uniforms, shirts, work clothes, ticking.
Yarn: A generic term for a continuer stand spun from a group of natural or
synthetic staple fiber, or filaments, used in weaving, knitting to form textile
fabrics yarn definition.
To boost the accuracy of the data gathered through questionnaires, sales persons
of different shops were interviewed. These interviewees were selected based on their
comparative exposure to marketing and contact with customers.
Therefore, the subsequent results and explanation are done based on the collected
data from the questionnaires, interview and observation. Be it well known, in this study,
secondary data were pricelessly given to make out additional investigation about
consumers preferences. Section 3.3 has detail information about local consumers.
The general criteria for market segmentation of textile and apparel are: -
• By age – babies and children’s, young, medium age and old age.
• By gender – women and men
• By area – rural and urban areas
• By type of product and type of activity
- Formal clothing – coats, dresses, skirts, trousers etc.
- Casual wear – shirts, pullovers made of cotton etc.
-
DEMOGRAPHICS
In order to know how much will be spent on clothing, the site and age structure of
the population are the basic determinants. It is well known that different age categories
have different clothing behaviors.
The Ethiopian population has an increasing birth rate and young population. In
2003/04 working age, population is 38.4 million which is2.7 % of the population.
Ethiopia is third populous country and one of the highest population growths in
Africa. Based on the population growth of the country, surveys indicate that the
population site will be doubled with in less than two decades. This articulates that there is
a big domestic market to textile and garment, besides external markets.
LIFE STYLES
Now days, clothing, more than ever, serves as the means of expression of
personality, character, ideas, and attitude to life will be emphasized by the way a person
dresses. Fashion and styles are eminently suited to expressing a personal style.
In the present day, people do not mind spending their money on low price, and it
is the main criterion to spend on goods. It creates a good opportunities for many clothing
shops (including street venders) are going in for upgrading and opening each day in
Ethiopia, By the same token, Life styles of local consumers are being changed due to
education sports, western films, and many other factors.
Fashion trends
According to a survey by Kurt Salmon associates (KSA: http://www.kurtsalmon.com),
the following fashion trends are expected to continue or will be new in the 21st century: -
CLIMATE
Climate weather has an impact on the timing of expenditure. Unexpected weather
changer influences consumers in their purchasing decisions, consumers in warm, dry
climates tend to buy cheaper clothing and less durable. It influences the share of clothing
expenditure. Now days weather condition of Ethiopia becomes warm and dry climates.
Trade configuration
- Distributors
• They hold their own stocks at own risk.
• There is one governmental owned distributor in the country and widely
knows as MEWIT (Merchandise whole sale and import trade enterprise). It
is not strong enough to distribute textile and clothing products as it has
performed like during the post regime.
• Private distributors are more active and effective. Their capacity have been
increased for the last ten years. This is due to the privatization policy of the
country.
- Retailers
• Retailers constitute the final stage before products reach the consumer.
There are many retailers in the country. Many textiles garment
manufacturing and destroy enterprises and distributors have established
retail shops mainly in Addis Ababa and production compounds. Some also
do have their own shops in big towns. The factories and distributors sell
textile and garment directly to the consumers and other users of these shops.
- Others
• Production based on customers and government orders. Orders may be
uniforms, bed sheets, working clothes etc.
- Street markets
• Street vendors are involved in clearing up stocks from manufacturers or
distributors. Some retailers have partners of street vendors.
LOCAL PRODUCTS
MANUFACTURES
DISTRIBUTORS
(IMPORTERS)
PRIVATE MANUFACTURING
RETAILERS WITH RETAILER
ACTIVITY
CONSUMERS
STREET
DISTRIBUTOR
VENDORS
WITH RETAILER
ACTIVITY
Foreign products
DISTRIBUTORS
(IMPORTERS)
Fig 3.1 Trade and distribution channels for textile in Ethiopia (Tailored to the study)
MARKET
Local consumer may buy textile products
- In known markets like Markato
- From street renders
- In fair and exhibition
- Around known places church and other places.
Retail Prices
The market is intensively competitive and prices vary according to the product,
type of outlet, purchaser behaviors and retailer’s judgment on the market. Because of the
lack of finance and time, it has not been undertaken to know retail prices of textile,
imported or local, products.
The most important expression of any business endeavor is to make available a product,
which satisfies consumer needs. Product is, therefore, the keystone of a marketing mix.
This study attempts to delve in to the subject of textile products and consumers
preferences in detail. Let us start on considerations on textile products. It applies to any
offering to a target audience of customers.
Women’s clothing
Although the demand of women’s clothing is high, retailers are unwilling to sell
or to stock such items. As most of the respondents replied, women’s preferences are
becoming changeable due to their tendencies towards fashion and style.
Men’s clothing
Since men are not inclined to fashion, the demand for one type of product exists
for a long time in the shelves. For this reason retailers and distributors are very interested
to stock and sell men’s clothes and it is a more profitable business. It has high demand in
the country.
Tee-shirts
Because it is fashion and it can use for many purposes as well as the hot weather
conditions, the demand of Tee shirts increases, especially for young consumers.
Moreover, functions vary from outerwear and underwear tonight wear, make it high
demandable. About 90% of Tee shirts are made of cotton.
Babies clothing
The mother is the customer. Any mother in Ethiopia not only dresses herself
fashionably but also her baby. It ranges from during her pregnancy she thinks and
collects the basic outfit for the baby. Often she is advised and helped by a friend or a
neighbor. There is custom to give a gift of clothing for babies that help to strengthen
friendship. On this study, it is known that the demand of babies clothing is high.
Poplin
The demand is high because it has many purposes.
Towel
High demand. It uses for household, hotels, and offices. In rural places, it uses as
blanket.
Twill
High demand. It is useful to make trousers and coats. It also serves as to make ready-
made clothes. Since it is made of cotton, it is expensive.
Drill Gray
Low demand. This is because of a low quality of Drill gray. Before a few years ago, it
was useful to make trousers in rural areas.
Yarn
It has high demand. Traditional Ethiopian clothes are made of yarn. In factories, it is
used as raw material for making different products.
The succeeding table shows some of the products and their nominal and unconscious
benefit:
Table 3.4 Products and their nominal and unconscious benefit
Local consumers
This local consumers study has a great emphasis on individual and family inclination
towards purchase of textiles in Ethiopian. To go at a greater distance in the analysis, the
personality traits and family life cycle are contributive factors. Consequently, within the
boundaries of Ethiopian accompaniment the two circumstances depict as proceed.
These are found based on distributors, some retailers and sales persons opinion on market
observation of the study.
Ethiopian family life cycle
1. Young singles
Incomes are medium since they have a good income sources. They tend to buy
textile.
2. Newly married
Medium level of discretionary income because both or one of them are usually
working. They need new products for their new house.
3. Married couples with children
Most studies state that the average family size in the country is six. Unless they have
a good income source, most of them are poor since they have more children. They are not
active in buying textiles
4. Young working live with their families
They have enough money for purchasing clothes, but dependant on parental support
for food and house rent expenses.
5. Old age or young dependant on parents
They are completely depending on parental support. Nevertheless, they have great
intentions to spend money on clothes, if they have a chance to obtain money
Consumers’ preferences
Income has been an important variable for distinguishing market segments. It simply
indicates the ability or inability to pay for a product. Moreover, it serves as a measure of
social class.
Local consumers who earn between 150 to 600 Birr per month mostly visit textile
shops. This is the fact that they have enough money to cover their basic needs such as
food. In most cases, they are interested and able to pay for a product. Such persons
usually visit shops, which located around Merkato.
While those who earn less than 150 Birr per month mostly go to Kolfe to buy illegal
imported salvages (used cloths.) Kolfe, which is found in Addis Ababa, is one of the
known market place, which provides salvage clothes in the country. It is known that poor
persons (earn less than 150 Birr per month) spend high percentage income on food.
On the other hand, rich persons include those who earn high salary per month and
those who have a good income source from foreign, go to modern shops located around
Bole and Pizza because they need high quality and fashion clothes. This survey assured
these conditions through questionnaire and interview.
The study learned that the demand of products often vary with consumers age and sex.
Based on the responses, more medium age and young women visit shops.
The following are the most important purchase criteria among Ethiopian consumers for
textile products (on percentage base.)
High quality (A good fit and comfortable) products 20%
Durability (will last/wear well) 60%
Value for money (reasonable price for the given quality) 20%
Good price / Quality 15%
Cheap price with products 85%
Past experience with products 40%
As shown on the data, consumers need cheap price clothes. The thoughts are the ensuing:
The above data on percentage stand are found based on the average valve of a given
percentage of respondents. Below is presented respondents ‘opinion vs purchase criteria.
1 2 3 4 5 6 Average
High quality (H) 25% 20% 15% 20% 20% 20% 20%
Durability (D) 55% 45% 70% 50% 80% 60% 60%
Value for money (V) 15% 30% 25% 15% 10% 25% 20%
Good price/Quality (G) 15% 20% 15% 5% 10% 20% 15%
Cheap price with products (C) 75% 95% 95% 75% 80% 90% 85%
Past experience with products (P) 55% 25% 35% 45% 30% 50% 40%
At one time consumers usually spend on clothing is between birr 150 to 300. This
expression is true for clothing markets today in Ethiopia, because most people dress to fit
their self-images and adorn their home to include their own social-class membership.
Young consumers need to differ themselves and their houses from others in terms of what
they consider fashionable or in good taste. Most working young local consumers live
with their family (mother and father.) This creates a great opportunity to spend their
income on clothes. In Ethiopia today’s economic condition, spending up to 300 birr on
cloth means a high expenditure relative to other products. This indicates local consumers
give high value to clothes.
Marketing specialists need segmentation to discover the needs and wants of specific
groups of consumers. The reason behind this is that people who live in the same area
share similar needs and that these needs differ from those of people living in other areas.
For example, textiles have better opportunities for buying in every less than three months
by one customer who live in urban than the one who live in rural area of Ethiopia.
Incomes, considerations on fashion and style, and exposure to advertisements are the
basic reasons to open a good opportunity to buy in less than three months for urban
customers. Whereas, poverty and consequence of this like no shops around the rural
areas, make the demand of textiles is low in these areas and they are forced to buy
products once a year. On circumstance, if the harvest is very well, they go to near cities
and buy what they need. This is accompanying reason to increase the demand of textile in
urban areas. The respondents indicated that urban customers buy textile in less than three
months, but in rural consumers buy with in one year.
As anyone knows, Ethiopians love to celebrate major landmarks in the religious calendar.
On these days, local consumers need, buy, and wear best and new clothes. For example,
the popular Ethiopia Timket /Epiphany tour is a good evidence for the study purpose.
Orthodox Christian believers buy new textiles for this day and there is a very popular
saying “ letimket yalhone kemis yibetates.”This is one of the marketing days for
Ethiopians. For the same reason, almost all-domestic consumers buy products for New
Year, on weeding months, and on important events on family life. However, customers
do not have habits to buy products on seasons whether be it summer or winter. The
weather condition of the country is constant through the year (13 month of sunshine) can
be considered the best reason for independent consideration of buying habit on seasons.
Local customers prefer to face-to-face communication on buying a product. Mail order or
Internet use on buying is not preferable way to purchase textile. Because consumers need
to see the products physically and there is not enough access of Internet especially in
rural areas.
The following are the usual and highly preferable means to buy a product:
In Fair and Exhibition
The demand of cloth is high. The society mostly believes that exhibition brings low
price and new products. Therefore, they tend to buy products.
In known markets
Open market is the outmost market area all over around the country. Consumers are
not usually use modern market places such as supermarkets. However, all cities have
large supermarkets and some customers, especially educated persons prefer them. There
is no textile supermarket in the country at all.
Street vendors
Today, street market is becoming popular market place in urban areas. Any person can
purchase different textiles there. Moreover, it has been longer time known places serve as
good marketing places in urban and rural areas. For example, churches. Respondents say
customers usually buy products in fair, in known markets, from street vendors, and
around known places.
Ethiopian marketers spend money each year on advertising, and have many forms and
uses. However, it is in its infancy stage. Domestic consumers are highly receptive
towards advertisement and promotional activities. They need to know about what, where,
how, and how much to buy is the reason. It is true that watching television program or
others involves exchange something of value for something the consumers’ needs. The
need is information or relaxation. In concise, people want to know more about what they
buy. Because of this they are highly expose to media and other promotional materials. All
respondents agreed the consumers are highly receptive towards advertisement.
For a consumer to make a decision, a choice of alternatives must be available. Since
textile is not like ‘prescribed medication’ and there are different type of textiles as well as
there are different market places, consumers have a strong choice between making a
purchase and not making a purchase. They have also a choice among different products.
Ethiopians consumers need to choose what they thought to buy. Every purchase can be
influenced by acquired needs. However, they need supportive idea, approval, or common
understanding from close friends, families or other persons. This indicates that consumers
have more than one reference group. There are several reasons that local consumers allow
other people to guide their consumer behavior. These are, among the others:
♦ They need information to reach a purchase decision
♦ Consumers can buy and use their purchases to make a statement about the image
they want to project
Urban local consumers can be considered as the most stylish and have a good taste.
Fashion plays an important role in purchasing decisions in particular for women. These
aspects led to a tendency to enjoy cheaper, comfortable, and practical textiles. A more
attitude to colour, design, and decorate products resulted an increased focus on imported
items. This driven by a desire for individuality, comfort, and expression of personality.
Another important factor for such desires is the more young population in the country and
families are highly imposed on decision to purchase a product by their sons or daughters.
Aesthetics of a fabric are a primary concerns for customers. Regularly, young consumers
are looking to life style brands. Notwithstanding, rural consumers are conservative on
fashion, color design, and comfort to buy a textile and new products take time to be
preferable. In most cases, relatives who live in urban cities advise them to buy fashion
products. Sometimes they are reluctant to decide. In the other hand, since they buy
products in urban markets, these make the demand of fashion items is high in general.
Men prefer blue, gray, and yellow colors. Women prefer red and brown. Both
need black, pink, and purple colors. Colour plays a dominant role on textile market. Local
consumers need black, purple, pink, stripes, and different shined textiles. This is just
based on respondents.
Ethiopian customers buy products for the purpose of the functional value of the
products. Moreover, they highly use clothes for expressing personality in rural and urban
areas.
Additional reasons for the high interest towards textiles by Ethiopian consumers are:
To decorate their homes
To celebrate holidays and family’s important days
Desire to be smart
Desire to be modern
Desire to be young
Personal satisfaction
Positive state of mind towards fashion and style
Good stance towards cloth
It is known that Addis Ababa is the central economic, social, and political place in
the country. According to the latest estimation, the population of the city is around three
million. This resulted in high demand for textile. Because of illegal products imported, in
the East of the country, the demand for products in particular local is prone. The demand
of textile is high in southwest cities and rural areas especially coffee growing areas. In
addition to this, northwest and east areas requests textile in high quantity. The reasons
behind these are spending pattern, good harvest seasons and land, growth employment,
and living standards. Dire Dawa, Mekele, Bahir Dar, Gonder, Jimma, Netheret, and
awassa score the highest demand among the cities. High population and living standards
are the reasons. The following tables show this trend.
It has been found that domestic textile products are useful for making clothes in
rural areas and they are rarely useful for cities. However, most textile factories produce
products for the use of uniforms and working clothes. Local textiles also use for curtain
and other household need. Local T-shirts are highly produced and sold in foreign and
domestic markets.
Moreover, the local firms produce textiles for a purpose to make traditional
clothes (yarn), and to other export products such as T-shirts and bed linen. On the other
hand, more respondents added that from the viewpoint of the factors of consumers’
demand of
◊ High quality
◊ Competitive prices
◊ Wide selections of products and
◊ Quick response to changing needs
Domestic products have stumpy performance as compare to imported items.
These indicate that their futures, the target to satisfy customers, and value creation are
very derisory and have low successes. The following are the grounds:
Products do not have unique futures
Lack of research and development
Lack of finance
Lack of training
Inability to remain competitive
Inability to develop a means of product differentiation
Inability to meet customer expectation
Homes, offices, hotels and others require large quantities and variety of textiles to
update their interior environment. In household textile products, includes: blankets,
pillowcases, hand and bath towels, tablecloths, and kitchen and glass cloths. Others
textiles, which are used for: window coverings, upholstery, decorative pillowcases, and
ceiling coverings.
Consumer expenditure on household and other textiles increases each year. The
positive developments in the household and other textiles in Ethiopia are the result of
some factors, like:
Economic, such as rising employment and consumer confidence
Intensive price competition among retailers
Growing imports from low-cost countries
Textile for expenditure on household and other textiles comprise a wide range of
products: from traditional made to very modern textiles. Customers are willing to spend
money to decorate their houses, offices, or hotel interiors based on the current fashion.
Specially, the need rises dramatically in holiday and weeding days. Young consumers
have a great interest in more fashionable interior textiles. Even if rural consumers and old
people of city inhabitants need to update their interiors, they are highly conservative in
buying fashioned textiles.
Observation summary
This summarizes the survey of the distributors opinion and market observation
based on the interview guide.
Most consumers do not look at the label before they buy textile, and follow the
instructions on the labels when washing clothing
Most consumers do not have habits to read care labels before making a purchase
decision
Care instructions do not affect local consumers impressions
Most consumers do not want to buy easily color fade textiles even if they are
fashioned and modern
Fabric content
100% cotton textile consumers need such of type textile because of its
appearance, attractiveness, and absorbency. It is
good for health, comfortable, and expensive in price.
It needs care on using and washing .It can be easily
shrunk.
100%polyster It can not be easily shrunk and it is cheap
in price. Consumers need it because of its price. To
be frank, it is not good for health. It creates warm on
body in warm times and the same characteristics for
Cold weathers.
Blend Most textiles sold in the country are made of the
blend-cotton and polyester. Clothes made of these are
cheap in price, attractive, and not that much need
care on using and washing.
Consumers need flame resistant fibers; and less shrinkage textiles when
wash
Consumers spend more time and effort searching for information when
purchasing
Young consumers tend to believe that price is a good indicator of quality
Consumers learn from past and present purchase experiences. It extremely
affects upcoming purchase.
Women consumers are more likely to credit when making purchases.
Young consumers buy the same clothes and dress or update their houses
the same way as a celebrity, peers, or attractive persons.
Local consumer behavior includes influencing others, using the product,
complaining, and disposing of the product and watching television
advertisement and many other activities.
Overall, given the choice between two similar articles of textile,
consumers prefer to buy the one, which is new, low price, and fashioned
products. In addition to this, they need and prefer brand familiar products
in most cases. The respondents agreed that they response quickly when
price is reduced. It is noted that the study confirmed that most consumers
important purchase criteria are price, easy care and durability.
Generalize the study is able to find the local consumers need as well as it is able
to explain some of the mixed problems of local products that deter them to get better
market in local and abroad. It also tries and identities and manufacturers tendencies in
texture businesses.
In a brief summary of consumers’ profile, the findings and observations are
summarized as follows.
Study conclusion
The purpose of this study is to investigate the consumers’ preferences for textiles.
It also further went in to seeing the tendencies of local products as compared to imported
products.
Although the main aim of study is as stated above, it does not claim to have
exhausted all the preferences of the consumers. It does not clime to have exhausted all the
textile products. However, through investigation of the consumers need and its impact
has been made through this research and this has enabled the marketers to come up with
valid and reliable outcomes that could later be used for further research in this area.
The findings obtained through in depth inter views with distributors, sales
persons, and some customers as well as questionnaires are presented, summarized, and
analyzed using both quantitative and qualitative methods.
Generally, the consumers preferences is the most prominent one for making a
patter profit as well as to satisfied consumers need. Age, sex, family, and income have
led the consumers to make a particular purchase decision.
Following the analysis of the findings, the central marketing concepts in this
study can be put in the following summarized points.
A. The preference of consumer can give us insights into why an individual makes a
particular purchase.
B. Consumers face conflicts involving how much time and effort to spend on
decision to achieve the best results.
C. On any given occasion, a consumer can be an influences, purchase, and / or user.
D. The important key stresses here are that consumers' preferences are influenced by
several factors.
E. The final insight recognized that consumer behavior differs for different people.
This assures that the process by which we identity meaningful target groups with
in a larger consumer market are extremely important.
Conclusion preferences can range widely for effort given to the choice and in
time. The study tells us what type of textile they buy and when they buy it. An the
findings of this study disclose, the core findings of the study put us follows in the table:
Consumers’ preferences
To Products - New fashionable textiles
- Purple, pink, stripes, and different shined textiles.
- Simple and comfortable textiles
- Natural materials (100% cotton textile)
- Flame resistance fibers and less shrinkage textiles when wash.
To Price Low
Top Advertisement To know more on the product plus to know fashion
To Distribution Good service, advice, and quantity
-This study states that firms (local companies) must to match their products to meet the
needs of potential customers. Thus, understanding the analyzed consumers preferences is
crucial for marketing success. by means of in marketing, a set of management decisions
conclude in what has came to be known as the marketing mix. The study indicated
marketers can know develop and formulate their marketing mixes.
Urban Activity buyer but small in New fashion clothes Not loyal
number
Learning about the consumer market represent a first step for a host of managerial
decisions, ranging from investment in new plants, to hiring workers, to planning
advertising campaigns. Thus, the study helps marketers to know about
Market composition
- Who Young, female, urban, inhabitants newly, married, and
Young working live with
- Who does not Old, men, rural, inhabitant married couples with children
Market trends
-What will the future bring - consumer satisfaction
-Attractive business profit
- Involvement protection
Recommendation
Thirty years back Car. H. poedtke wrote a very fine article on Management Advisor. He
said
''Each morning's headlines each evening's news broadcasts, remained us once again that
we live in a world of accelerating true any change. Things that have been taken for
granted for years are not necessarily true any longer. To quite the rule of Siam in "The
king and I', 'when I was a boy, world was better spot. What was so was so, and what was
not was not. The king's plativelament could very well be the most enduring truth of our
time. That truth has meaning to each of us in the business community, aside from our
concern as citizens.
That article on its special underling says
'' The rapid changer is politics, in economics, in society itself, are inheritably reflected in
the business work. This means that old methods that once worked there are so longer
necessarily valid. Perhaps it is time we all restructured our thinking.
Thus, we all must fast to restructure our thinking to be a part of a global market .The
market that is very complex in the fast moving world. The question here is that what to
do we restructure, but not when do we restructure, because it has a very fast answer, now.
The restructure things must follow on the responsibility to the customers. With out them
we would have no reason for being. We strive to appeal to a broad spectrum of
consumers, catering in a professional manner to their needs. The thinking to words to the
customer includes a wide selection of quality produce profiling reseanable price and
delivery products with courtesy and professionalism.
Now, the study indicated that local marketer must shape are reshape their strategies to be
effective and efficient in practical market. To be a modern professional marketer the
marketers must understand how consumer will respond to different product features
prices, and advertising appeals.
Understanding consumers’ preferences is complicated for markets with in the borders of
a single country. For products that have high demand in international market,
understanding and serving the needs of consumers can be disheartening. This is because
consumers in different countries have different values, altitudes and behaviors. It is
necessary to recognize such differences and adjust the product and marketing programs
accordingly.
Therefore, in our country textile marker practices all marketers must organize and do
their best on the reshape of the existing marketing strategies: This plan can be better
called as "flexible restructuring" (F.R). Why?
The changes in Demographic trends can have an adverse impact on demand. Ever
increasing in fashion and tastes can have a great and unpredicted effect on organizations.
Beyond doubt, textile market is a superior and magnificent exemplar in this fact. More
outstandingly, today's incrustation concern about information technology and its result ( a
better access to relatively accurate information),companies could be highly affected by
the consumers' awareness and instantaneous changes of consumers' preferences.
Correspongly, marketers especially textile industry which is one of the results of highly
developed technology can have a great chance to change radically with a change in
different factors. Due to this fact, companies will face the problem of rising in consumers'
preferences in particular and marketing in broad. The need to search ways of establishing
priorities may be the concern of all companies. Managers may or may not understand that
they live and operate in extremely dynamic environment.
Nevertheless, the concern now is that much different from the preceding ;we are just in
different world.Therefore,to share the global market and to compute with excellent
companies, it is a must and the outstanding choice t adjust and review the existing
strategies with a nonstop improvement as per changes.
The End
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