Evaluation of Distribution Strategies in Marketing of Petroleum Products
CHAPTER ONE
OBJECTIVES OF THE STUDY
The objectives of the study are as follows:
- Investigating and identifying the problems militating against the smooth distribution and marketing petroleum products in NNPC (Aba depot)
- To make recommendation on how to forestall future occurrence
- To proffer solutions to those problems.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
COMPONENTS AND DEFINITIONS OF DISTRIBUTION
According to Philip kotler & Armstrong 2001, Distribution is the process of planning, implementing and controlling the physical flow of materials, final goods and related information from point of origin to points of consumption to meet customer requirements at a profit. Schewe and Smith (1980) defined distribution as the physical movement of products to the ultimate consumers. Production is not complete until goods reach the final consumers and products are worthless until they are made available to those who need them. It is this process of making goods available to those that need them that gives rise to distribution basis in a marketing strategy. Achison (2000) defined distribution as the process of getting products and services from producer to consumer or users, when and where they are needed. It provides time, place, possession distribution system is a key external resources which normally takes years to build and can not be easily changed. According to him distribution involves two aspects: Physical distribution and channels of distribution. Physical distribution involves the physical flow of products from the producer to the consumer while channel of distribution involves the flow of title of goods from the producer to the consumer. Achison (2000) denoted that unless products are distributed and delivered in the right quality, at the right time, in proper condition and at the right price; buyers may be reluctant to buy. He stressed further that distribution is regarded as a major consideration in strategic planning because it is an important marketing function that is responsible for making goods and services available to the consumers. According to John O’ Shaughnessy (1992) in his book competitive marketing. A Strategic Approach denoted that a distribution system is the network of people, institutions or agencies involved in the flow of a product to the consumers, together with the informational, financial, promotional and other services associated with making the product convenient and attractive to buy and re-buy.
THE ROLE OF DISTRIBUTION CHANNEL IN MARKETING
It is very obvious that distribution channel ensures that finished products gets into the hands of the final consumers as at when needed through an effective means of transportation as well as the middlemen who handle the goods. It helps to move goods and services from one place to another (place utility), it bring goods or services to the consumer when he wants them (time utility); they bring the goods or services to the consumer in convenient shape unit and package (convenience value); it makes it possible for the consumer to get the goods or services at a price he is willing to pay by providing conditions which bring satisfaction couple with pride of ownership (possession value) to consumers. The desired objective is to perform these services or functions at the lowest possible cost with the greatest possible efficiency in order to serve the consumer better. If one manufacturer, supplier or seller does not seek to do this a competitor will outwit him. As a matter of fact, the channel chosen, whether directly from the producer’s factory or point of manufacturing to the consumer or through functional and merchant middlemen, has a great deal to do with the destination reached by the goods, the cost at which they reach this destination, the utility, value and satisfaction derived by the consumer from the goods.
CHAPTER THREE
RESEARCH METHODOLOGY
Research design
The researcher used descriptive research survey design in building up this project work the choice of this research design was considered appropriate because of its advantages of identifying attributes of a large population from a group of individuals. The design was suitable for the study as the study sought to evaluation of distribution strategies in marketing of petroleum products
Sources of data collection
Data were collected from two main sources namely:
Primary source and Secondary source
Primary source:
These are materials of statistical investigation which were collected by the research for a particular purpose. They can be obtained through a survey, observation questionnaire or as experiment; the researcher has adopted the questionnaire method for this study.
Secondary source:
These are data from textbook Journal handset etc. they arise as byproducts of the same other purposes. Example administration, various other unpublished works and write ups were also used.
CHAPTER FOUR
PRESENTATION ANALYSIS INTERPRETATION OF DATA
Introduction
Efforts will be made at this stage to present, analyze and interpret the data collected during the field survey. This presentation will be based on the responses from the completed questionnaires. The result of this exercise will be summarized in tabular forms for easy references and analysis. It will also show answers to questions relating to the research questions for this research study. The researcher employed simple percentage in the analysis.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
Introduction
It is important to ascertain that the objective of this study was to ascertain evaluation of distribution strategies in marketing of petroleum products.
In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in addressing the challenges of distribution strategies in marketing of petroleum products.
Summary
This study was on evaluation of distribution strategies in marketing of petroleum products. Three objectives were raised which included; Investigating and identifying the problems militating against the smooth distribution and marketing petroleum products in NNPC (Aba depot), to make recommendation on how to forestall future occurrence, to proffer solutions to those problems. In line with these objectives, two research hypotheses were formulated and two null hypotheses were posited. The total population for the study is 200 staff of NNPC, Aba, Abia state. The researcher used questionnaires as the instrument for the data collection. Descriptive Survey research design was adopted for this study. A total of 133 respondents made administrative staff, human resource managers, senior staff and junior staff was used for the study. The data collected were presented in tables and analyzed using simple percentages and frequencies
Conclusion
To ensure that the current petroleum products availability is sustained, the Federal Government has directed the Federal Ministry of Petroleum Resources and the NNPC to design and implement practical measures to ensure steady supply of fuels to all parts of the country on sustainable long term basis. Also, the refineries at Warri, Port Harcourt and Kaduna are being renovated to drive increased local refining capacity. NNPC Retail. As at the last count, NNPC Retail has acquired 487 affiliate stations in addition to its 37 mega stations and 24 floating filling stations. This is part of its strategic plan to own more than 50 per cent of the entire filling stations in the country with the aim of squelching future artificially induced fuel scarcity
RECOMMENDATION
From the evaluation done and conclusion drawn from the conceptual analysis above, the following recommendations therefore become imperative:
- Oil is presently, the mainstay of the Nigerian economy, and it is interesting to know that emerging stakeholders in the sector will have great impact on macroeconomic stability, therefore Nigeria must insist on the maximization of national interest, most importantly for the economic benefit, as well as for the empowerment of the Nigerian consumers of petroleum and petrochemical products.
- Nigeria, as petroleum resource owner, must find the common ground and the path to partnerships that would benefit all stakeholders in the oil and gas industry. The government is encouraged to use a pragmatic and cooperative approach to ensure a win- win situation for itself and its partners in energy production, distribution and consumption.
- Federal Government must ensure that the Petroleum Industry Bill (PIB) respects existing commitments on which investments had already been made, because without the investors’ confidence, there may be no incentives to invest; therefore revisions to the petroleum fiscal and regulatory regime should not introduce multiple taxes, high royalties and remove incentives; if these impediments are introduced, oil and gas projects would not be economical for investors.
- The challenges of low level of production capacity at the refineries and infrastructural bottlenecks that led to moving products by road rather than pipelines or railway; thus pushing up petroleum products prices should be addressed by all concerned stakeholders.
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