The Impact of Marketing Logistics on Corporate Profitability in the Brewery Industry (A Case Study of Nigeria Brewery Plc Enugu)
Chapter One
OBJECTIVES OF THE STUDY
The objective of this study among other things includes:
- To determine the impact of marketing logistics on the profit ofbrewery industry.
- To appraise the marketing logistics activities of brewery industry in order to determine their impact on products availability.
- To determine whether distribution system dopted by brewery lead to increased customer patronage.
- To identify the causes of scarcity of soft drinks in Enugu.
- To find out whether soft drinks are available at the right time.
- To find out whether soft drinks are available at right quality .
- To offer solution and suggestion on how to tackle and alleviate marketing logistics problems.
CHAPTER TWO
REVIEW OF LITERATURE
INTRODUCTION
Our focus in this chapter is to critically examine relevant literatures that would assist in explaining the research problem and furthermore recognize the efforts of scholars who had previously contributed immensely to similar research. The chapter intends to deepen the understanding of the study and close the perceived gaps.
CONCEPTUAL FRAMEWORK
Logistics and marketing
Recently logistics and marketing have been treated in companies as separate areas. The reasons of that fact were the following, Pilarczyk, Mruk, Sojkin, Szulce (1999): ¾
- traditional treatment and mechanical division of marketing and logistics function, but meaning of logistics in gaining and maintaining of competitive edge was small (logistics was treated and organized as a transportation and warehousing department), ¾
- showing off a role of logistic costs from the point of view of a growth of company effectiveness and success (cost approach was against marketing market orientation, which caused separation of marketing and logistics), ¾
- underestimation in practice of goods physical route management and its information conditions in aspect of integrated marketing management (not long ago marketing management was restricted to product’s strategy, price and promotion; rarely a marketing department was responsible for all aspects of integrated management in the sphere of distribution and delivery with conscious logistics including).
Marketing and logistics are similar because they both attend in an adjusting process of structure and dimension of supply to customers’ needs and wants. They are also complementary — marketing stimulates demand, logistics satisfies it by distribution processes, Blaik (2001). Marketing embraces all activities and instruments which have direct purpose recognition, specification and a creation of market effects potentials and company success. Logistics is geared towards the creation and usage of effectiveness potentials and the system supporting a company market orientation. Integration of logistics is oriented to the growth of customers´ services. Both approaches give a possibility of an effective use of potentials and skills, which contribute to the achievement of a required service level and long-term customers´ satisfaction and loyalty, as well as a proper amount of profit in the strategic dimension. During a strategy preparing, it must be taken into account, that long-term and complex creating and using of marketing and logistics potentials and skills could let to simultaneous achievement and common support mentioned above logistics and marketing goals in scope of general company purposes (Pilarczyk et al, 1999).
Marketing Logistics
From the point of view of management, marketing logistics has been described by Philip Kotler as “planning, implementing and controlling the physical flows of materials, final goods and related information from point of origin to point of consumptiorz to meet customer 5 requirements at a profit “. In short, it involves getting the right product in right quantity to the right customer in the right place at the right time. (Pilarczyk et al, 1999).
Traditional physical disctribution typically started with products at the plant and then . tried to find low-cost solutions to get them to customers. However,.today’s marketers prefer marketing logistics, which starts with the marketplace and works backward to the factory. To understand this, you have to first understand the concepts of logistics management and supply chain management (ABT et al 2000).
Logistics describes the entire process of moving raw materials and component parts into a firm, moving in-process inveoty through the firm, and moving finished goods out of the firm. Effective marketers create and maintain long-term relationships with a chain of organizations to perform this logistics function. The term supply chain is used to describe all the organizations that regularly supply a marketing company and all members ofthe marketer’s channel of distribution. The ideal supply chain is a collaborative arrangement in which all organizations see themselves as partners working together to increase logistical efficiency. Supply chain management or logistics management, thus involves planning, implementation and controlling a chain of organizational relationships to assure the efficient flow of both inbound materials and outbound finished products. Clearly, the term supply chain management is broad in scope because it encompasses planning and coordinating the physical distribution of finished goods and managing the movement and storage of raw materials and supply parts needed during the procurement and production process. Slupply chain management, thus, includes two aspects (1) Inbound logistics, which includes all the activities associated with bringing raw materials and supplies to the point of production and moving the inprocess inventory through the firm. Inbound logistics is also referred to as Production Logistics. (2) Outbound logistics which includes the broad range of activities concerned with efficient movement of finished products from the end of production line to the consumers. Outbound logistics is referred to as marketing logistics. Thus, production logistics and marketing logistics put together called supply chain management or logistics management. Study carefully to understand the relationship between supply chain management and marketing logistics (ALTKORN, J., 1998).
Normally, marketing logistics and physical distribution are used synonymously by many marketers. Moreover, there is slight difference in these terms.
Physical distribution
Physical distribution is a term employed in manufacturing and commerce to describe the broad range of activities concerned with efficient movement of finished products from the end of the production line to the consumer. In short, physical distribution refers to the flow or products from producers to consumers. Its major focus is the physical aspects of that flow rather than the institutional activities within channels of distribution dealing with changing title, facilitating exchanges, and negotiating with intermediaries. Historically, we have moved from physical distribution to logistics management and then to supply chain manangement. This major difference seems to be that supply chain management is the preferred name for the actualization of “integrated logistics”, with it acting as an enabler, it is now possible to have an integrated process view about the logistics and all allied processes related to business. You are now clear that the process of marketing logistics involves handling and movement of products from the point of production to the point of consumption or use. The important activity involved in this process includes order handling, information processing, inventory”, control, storage and transportation. Thus, the major elements of marketing logistics may be listed as follows:
Objectives of Marketing Logistics
Determining the objectives is the first step in managing an activity in a planned and systematic way. It is so because the objectives serve as a guiding force for chalking out the strategy for the successful completion of the task. In the area of marketing logistics too, the strategy will depend upon the objectives sought to be achieved in this regard. Thus, it is important for the firm to specify the major objectives of the marketing logistics system. The objective of any marketing logistics system is to move the goods to the right place at the right time, and at the lowest possible cost. Thus, customer service and cost reduction are the two basic objectives of an effective marketing logistics system in an organisation. However, there may be some more specific objectives in a given ‘ marketing situation (BLAIK, P., 2001). Some such objectives are described in detail below:
CHAPTER THREE
RESEARCH METHODOLOGY
AREA OF STUDY
Nigerian Breweries Plc, is the pioneer and largest brewing company in Nigeria. It serves the Nigerian market and exports to other parts of West Africa. Nigerian Breweries was incorporated in 1946 and the first bottle of its brand, the STAR Lager, rolled off the bottling lines of its Lagos brewery in June 1949. As the company expanded into other regions, it established more breweries such as Aba Brewery in 1957 and Kaduna Brewery in 1963. By 1971, the company was one of the largest industries within the country in terms of capital investment. In 1982, another brewery was added in Ibadan. In September 1993, the company acquired its fifth brewery in Enugu, and in October 2003, its sixth brewery, sited at Ameke in Enugu. Ama Brewery began brewing on the 22 March 2003 and at 3 million hectolitres is the largest brewery in Nigeria.
RESEARCH DESIGN
Research designs are perceived to be an overall strategy adopted by the researcher whereby different components of the study are integrated in a logical manner to effectively address a research problem. In this study, the researcher employed the survey research design. This is due to the nature of the study whereby the opinion and views of people are sampled.
POPULATION OF THE STUDY
According to Udoyen (2019), a study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitute of individuals or elements that are homogeneous in description.
This study was carried out to examine the impact of marketing logistics on corporate profitability in the brewery industry Nigeria Brewery Plc Enugu as a case study. The staff of Nigeria Brewery Plc Enugu form the population of the study.
Statistics from the Nigeria Brewery Plc websitew shows that the population is 3,195.
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
DATA PRESENTATION
Table 4.1: Demographic data of respondents
CHAPTER FIVE
CONCLUSION AND RECOMMENDATION
CONCLUSION
In this study, our focus was to examine the impact of marketing logistics on corporate profitability in the brewery industry Nigeria Brewery Plc Enugu as a case study. The study specifically was aimed at determining the impact of marketing logistics on the profit of brewery industry; To appraise the marketing logistics activities of brewery industry in order to determine their impact on products availability; To determine whether distribution system dopted by brewery lead to increased customer patronage; To identify the causes of scarcity of soft drinks in Enugu; To find out whether soft drinks are available at the right time; To find out whether soft drinks are available at right quality; To offer solution and suggestion on how to tackle and alleviate marketing logistics problems.
The study adopted the survey research design and randomly enrolled participants in the study. A total of 100 responses were validated from the enrolled participants where all respondent are active workers in Nigeria Brewery Plc Enugu.
The findings revealed marketing logistics as adopted by NB PLC encourages consumer patronage; marketing logistics as adopted by NB PLC lead to increases market share by the company; marketing logistics adopted by NBPLC help the company to fight competition; marketing logistics practice of NB PLC impact positively on their profit.
RECOMMENDATION
Based on the responses obtained, the researcher proffers the following recommendations:
Management of Nigerian Brewery Plc, Enugu should endeavour to utilize the right marketing logistics strategies to help enhence their productivity and profitability.
The management of NBP should always reach out to their customers through diverse means to make sure they don’t run out of stocks.
REFERENCES
- ABT, S. and K. RICHTER, 2000: Logistics across borders, Wyd. ILiM, Poznań.
- ALTKORN, J., 1998: Basics of marketing, collective work, Institute of Marketing, Krakow.
- ALTKORN, J. and T. KRAMER, 1998: Leksykon marketing, PWE, Warsaw.
- BLAIK, P., 2001: Logistics. The concept of integrated management, ed. II, PWE, Warsaw.
- CIESIELSKI, M., 1999: Logistics in company strategies, PWN, Poznań.
- DĘBSKI, S., 1998: Economics and organization of enterprises, Wydawnictwo Szkolne i Pedagogiczne, Warsaw.
- DWILIŃSKI, L., 1998: Introduction to logistics, Oficyna Wydawnicza PW, Warsaw. 12
- GARBARSKI, L., I. RUTKOWSKI and W. WRZOSEK, 2000: Marketing. A turning point for a modern company, PWE, Warsaw.
- KOTLER, P., 1998: Marketing. Analysis, planning, implementation and control, Ed. Gebethner & Spółka, Warsaw.
- LICHTARSKI, J., 1999: Foundations of enterprise science, University of Economics Publishing House, Wrocław.
