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ABSTRACT
The objective of this study is to examine the impact of effective distribution strategies on the sales performance of manufacturing firms in Port Harcourt (A case study of LG Electronics Inc). The research design used was the descriptive survey method. The population of the study consists of the management/staff of LG Electronics Inc and the sample size used was 135 drawn from the management/staff of LG Electronics Inc through the use of convenience sampling techniques. Accordingly, a well structured questionnaire which sought to draw out relevant information from respondents was designed and administered to respondents. The data collected from the questionnaire were presented in simple tables and the results interpreted. The research hypothesis was tested using Pearson product moment coefficient correlation which shows that there is a relationship between effective distribution strategies and the sales performance of LG Electronics Inc. hence, LG Electronics Inc’s management should endeavour to understand the various distribution strategies and adopt an appropriate one that will increase its sales performance.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Today’s globally distributed networks have elevated the impact of effective distribution strategies in organizational success. In fact, in recent years, firms are increasingly viewing the distribution process as a competitive strategy (Mentzer, 1999). In this light of this increasing importance, the over achieving goal of the distribution function is to strategically manage such crucial functions as purchasing materials management, inventory control, transportation, and customer care they will ultimately enable it to effectively move the products to end consumer in order to make sales (Mentzer, 1999).
In other words, effective distribution relates to meeting customer needs by effectively managing and moving products through the distribution channel. Additionally, it must also focus on eliminating waste in terms of time, effort, and inventory within the manufacturing – distribution system (Lusch, 1990). Thus, the role and impact of distribution management has expanded to include strategic responsibilities that enable the just-in-time distribution of the right quantity to the right place at the right time, hence, maximizing greater sales.
Effective distribution strategies is concerned with the effective channel and arrangement used to make goods and services available to customer, also intermediaries and marketing channel structure to be selected to move product in the most competitive and effective manner to satisfy customers needs and want, which will in turn lead to sales (Achison, 2002).
In today’s business activities, despite the fact that many manufacturing industry in Port Harcourt have recognized the impact of effective distribution strategies on its sales, majority have not yet consider it as important issues. The whole essence of producing products is to make sales in order to maximizing profit and increase productivity. But without effective distribution strategies, sales can not be made because it is only when goods get to the consumer at the right quantities, right time and place that sales can be made. Upon this premise, the research is aimed at investigating the impact of effective distribution strategies on the sale performance of manufacturing industry in Port Harcourt with a case study of LG Electronic Inc.
1.2 STATEMENT OF THE PROBLEM
In today’s business world, competition is increasing as new manufacturing companies are been established. Manufacturing companies are striving very hard to surviving, this they do by coming up with innovative products in order to attract consumers and make sales while little attention is given to distribution. It is pertinent to state that the production process cannot be said to complete until the goods reach the final consumers, so as for sales to be made. The effective distribution strategies have resulted to decrease in sales, unavailability of goods and losses which in turn leads to closing down of some manufacturing companies, hence effective distribution is indispensable to the sales performance of manufacturing industry. Upon this premise, the research is aimed at investigating the impact of effective distribution strategies on the sales performance of manufacturing industry in Port Harcourt (A case study f LG Electronics Inc).
1.3 OBJECTIVE OF THE STUDY
The objective of the study is to access the impact of effective distribution strategies on the sales performance of manufacturing industry in Port Harcourt with a case study of LG Electronic Inc. The specific objective includes;
- To determine how effective distribution strategies can enhance sales of LG products.
- To access the performance of effective distribution strategies on the sales performance of LG Electronic Inc.
1.4 SIGNIFICANCE OF THE STUDY
The study is significant because it investigate the impact of effective distribution strategies on the sales performance of manufacturing industry in Port Harcourt with a case study of LG Electronic Inc.
This study will also help direct the attention of manufacturing industry especially LG Electronic Inc on the need to come up with effective distribution strategies so as to increase sales and profitability. It will also serve as a reference material for future researchers in the same field.
1.5 THE RESEARCH QUESTIONS
The Research questions postulated for this study include the following:
- Do effective distribution strategies have impact on the sales performance of LG Electronics Inc?
- What is the relationship between indirect distribution strategy and the market share of LG Electronics Inc?
III. What is the relationship between direct distribution strategy and sales volume of LG Electronics Inc?
- Is there any relationship between intensive distribution strategy and profitability?
- Do direct distribution strategy have an impact on the sales volume of LG Electronics Inc?
1.6 RESEARCH HYPOTHESIS
For the purpose of this study, the following hypotheses will be treated.
H0: There is no significant relationship between indirect distribution strategy and market share of LG Electronics Inc.
H1: There is a significant relationship between indirect distribution strategy and market share of LG Electronics Inc.
H0: There is no significant relationship between direct distribution strategy and sales volume of LG Electronics Inc.
H1: There is a significant relationship between direct distribution strategy and sales volume of LG Electronics Inc.
1.7 SCOPE OF THE STUDY
This study is focus on investigating the effective distribution strategies on sales performance of manufacturing industry in Port Harcourt, a case study of LG Electronic Inc. It also seeks to examine how effective distribution strategies can be developed by manufacturing firms so as to use it to achieve greater sales at the long run.
1.8 LIMITATION OF THE STUDY
In carrying out this research, the researcher encountered the following constraints, which are
Time: The time given to the researcher is not sufficient enough to carry out a thorough research.
Finance: Fund is very necessary and paramount for a successful research, but the researcher did not have all the necessary funds to move from one place to another to source for data and research materials.
Attitude of Respondents: The researcher faced difficulties in collecting information from the respondents. Some refused to give out the right information while some bluntly refused to respond to any question asked.
1.9 DEFINITION OF TERMS
Distribution: The actual movement of goods and services from the sources of supply or manufacture to the ultimate consumer.
Strategies: These are methods or plans chosen to bring about a desired future, such as achievement of a goal or solution to a problem.
Manufacturing Industry: Manufacturing Industry refers to those industries which are involve in the manufacturing and processing of items and indulge in either creation of new commodities or in value addition.
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