Impact of Foreign Goods on Nigerian Consumers
CHAPTER ONE
Objectives of The Study
The main objective of this study is to investigate the impact of foreign goods on Nigeria consumers in Aba North and Calabar municipality.
The specific objectives and are to:
- to identify the reasons for high preferences for foreign goods by Nigerian consumers
- to evaluate the problems being faced by consumers in choosing between foreign and locally made products
- to investigate the impact of the preference for foreign goods by Nigerian consumers on Nigerian economy.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
Most goods that have foreign origin otherwise called foreign goods are those that are traded at the international market and sold to those countries that lack the knowledge or technical know-how and the necessary resources to produce similar products
It is important to note that most developed countries (DCs) like America, Britain, Japan and of late Asian countries form the major suppliers of these products that meet international acceptance. The less developed countries (LDCs), including Nigeria and her counter-parts are have temporarily refused to improve on her production techniques, but depend on technologically advanced nations for the bulk of her consumables. This scenario is not healthy for a country like Nigeria, that is endowed with abundant human and material resources, that have remain temporally fallow and untapped, just because the nation and its people have not realized the essence of being independent in a true sense. This journey can start with the reviving of infant industries, so that they can function effectively to meet the demands of the market, which will in turn generate avenue for employment and wealth creation.
The basis of foreign or international trade is the difference in the resource endowments of nations. It is true that some countries are better endowed with natural and human resources than others. Thus the importance of foreign trade in the development process has been stressed in the two-gap programming model developed by Mckinnon in 1964 and Chenery and Strout in 1966. The pertinent feature of distribution of world resources is irregularity or imbalance, possibly no country claim self-sufficiency in its resource requirements or a perfectly balanced supply of resources. For example while Japan is highly advanced in automobile technology, it lacks iron and coal. Russia with advance technology lacks agricultural potentials. Indian has human resources but deficient in capital and technology, Nigeria is the most populated country in Africa, yet lacks the necessary technology to improve her marketing landscape. Dwivedi’s (2002) said that some countries may have vast potential in the production of some goods, it may be severely handicapped in the production of others. This uneven distribution of resources and technology necessitated to countries depending on each other in an exchange process.
Today global competition is intensifying, such that foreign companies are expanding aggressively into new international markets, and domestic markets are no longer viable and rich in opportunities as it was before now. According to Kotler and Armstrong (2001), the firm that stays at home to play it safe not only might lose its chance to enter other markets, but also risks losing its home market. It is therefore imperative that companies wishing to compete favourably need to improve their product at home and expand into foreign markets. A firm or country producing an internationally traded product is bound to compete with foreign goods in both domestic and foreign markets. Even if a firm produces only for the domestic market, it may be using imported inputs, such that a rise in the price of inputs, will definitely affect the cost structure. Businesses or firms that are not engaged in international marketing have to compete with the export industry in the factor market and with the foreign goods competing in the commodity market. Hence the emergence of a largely borderless world that has invented/or unfolded a new reality for all types of firms and their products. This is as a result of world trade being driven by global competition amongst firms that have global focus, for global consumers. Nations and companies are now focusing on international markets for obvious reasons; most domestic markets now offer limited opportunities for expansion, others include saturated markets, intense competition and vulnerable marketing environment. Mills (1848) as quoted by Nyong (2005) postulated the dynamic benefits of international trade to include; (1) those that widen the extent of the market, inducing innovations and increasing productivity (2) those that increase savings and capital accumulation (3) those that have an educative effect in instilling new wants and tastes, and in technology transfer. For example, Changes in economic, socio-cultural and political regime have opened the flood-gate (markets) in eastern Europe, China, Latin America, Far East, Africa and other parts of the world, opportunities to explore the various markets with consumer products that will be beneficial to both the importing and exporting countries. Thus it is increasingly important for producers in Nigeria to adopt international marketing orientation and focus, because import is taking reasonable share of domestic market for various products.
CHAPTER THREE
RESEARCH METHODOLOGY
Research Design
Research design is a plan of how the researcher intends to carry out the research in order to solve the research questions. (Babbie and Mouton 2001:74). This study employed both the qualitative and the quantitative approaches to determine the impact of foreign goods on Nigerian consumers. These approaches therefore are aimed at understanding the phenomena under study on their own terms and provide a description as well as statistical information about human experiences.
Study Population
Population is the entire group or individuals that share the same characteristics. It is the aggregate or collection about people one intends to make references through the study of the sample. Bello and Ajayi, (2005) refer to it as a set of all possible cases of interest in a given research activity.
The population of the study is restricted to All the residents in Aba North and Calabar municipality.
CHAPTER FOUR
DATA ANALYSIS AND DISCUSSION
CHAPTER FIVE
CONCLUSION AND RECOMMENDATION
Conclusion
It is true that trading activities intensified in this part of the country during the days of the scramble for colonies. The colonialist came with both political and economic intentions. As they penetrated the inter-land they came with their products which they sold to the natives. These newly found products instill a new pattern of consumption. Armed with this inclination, consumers’ propensity towards buying foreign goods continued even when similar goods are found in domestic market. This has really exposed competing local brands to severe competition. In as much as this study is not advocating autarky or complete restrictions, other measures should be adopted, as suggested in the recommendations. The implications of not taking the right step have negative effect on the performance of other macro-economic variables. In achieving these objectives all must put their act together. This means that producers should produce quality shoes especially when they are opportune to have the much needed materials or inputs, and increase the chances of the products becoming more competitive.
Recommendations
Based on the finding of this study, the following policy recommendations are made;
- As a matter of fact producers of shoes must learn to manufacture quality shoes. They should not compromise quality because of the cost factor attached to each unit of production. This is because a good quality product can advertise and market itself. Sometimes in the short-run such a product may not be making reasonable profit, but in the long-run profit will accrue because it has won a reasonable number of consumers’ patronage.
- The government must provide the enabling environment that favours the performance of business through the provision of space for the citing of shoes manufacturing companies by willing and able entrepreneurs. The government can equally fund and establish its own company
- There should be opportunities for producers of the product to obtain facilities in the form of loans, deferred payment for inputs, subsidy on some expensive materials used in making shoes, etc, for this will better their position.
- Since some of the equipment or operating machines used in factories for the production of shoes are too expensive for a willing entrepreneur that is proficient in shoe production to buy, it will be necessary for the government to make provision for such and make them handy to deserving individuals. That is, such buyers must reach agreement with the government on how to pay back the cost of the equipment or machine that will be spread over the years. This will encourage domestic firms to produce and foster the growth of local firms. Moreover the technological advancement which is long envisaged will be a step by the corner.
- You can take a horse to the stream, but you can not force it to drink water, so also is the consumer, he is exposed to the product, the decision to buy lies on the choice he makes. But sometimes the choice consumers make is based on their attitude, perception and the prevailing situation apart from their economic disposition, if that is the case consumers of shoes in Cross River and Abia states and Nigeria as a whole should try as much as possible to patronize made in Nigeria shoes. Especially those that compete favourably with the ones from Asian countries, that have connotation of being sub-standard. To add to this point, the government is propagating and urging buyers /consumers to buy made in Nigeria products, in order to strengthen the economy. If that is done producers will remain employed for as long as possible and contribute to Gross National product (GNP) generation.
- Enlightenment campaigns and workshops must be conducted to train and reorientate both producers and consumers. Also research and development institute that will take care of this sector should be put in place or become more functional if it is already in existence.
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