SSS2 FIRST TERM

MARKETING NOTES

Week(s) Topic
1. Distribution – meaning of distribution; types of distribution; and importance of distribution.
2-3. Channels of Distribution – meaning of channels of distribution; wholesaler; characteristics of
wholesalers; types of wholesalers; functions of wholesalers; retailer; characteristics of retailers;
types of retailers; and functions of retailers.
4. Consumer in the Channel of Distribution – consumer; characteristics of consumers; types of
consumers; consumer rights; and functions of the consumer.
5. Choice of Distribution Channels – Factors that influence the choice of distribution channels.
6. Transportation – meaning of transportation; importance of transportation in marketing; and
modes of transportation.
7. Land Transportation – definition of land transportation; road transportation; and rail
transportation.
8. Air Transportation – definition of air transportation; advantages of air transportation and
disadvantages of air transportation.
9. Water Transportation – advantages of water transportation and disadvantages of water
transportation.
10. Choice of Transportation – factors influencing the choice of transportation; and documents used
in transportation in marketing.
 DISTRIBUTION

Meaning of Distribution
Also called product distribution, distribution is the process of moving products and services
from producers to consumers. It involves selling and delivering a product or service from the
producer to the customer. Distribution is concerned with ensuring that goods and services reach the
target customers in the most efficient way. For goods, distribution is aimed at delivering them in the
best possible direct way to the consumers. On the other hand, distribution ensures that services are
well accessed by clients.
However, in order to ensure an efficient distribution of goods and services to target
customers, there must be distribution management. Distribution management refers to a set of
activities to must be carried out by companies and distributors to ensure an efficient distribution of
products and services. These activities include but not limited to packaging, warehousing, inventory
management, transportation, logistics, selection of distribution channel, selection of channel
members, and compensation of distributors.

Types of Distribution
The various types of distribution are discussed as follows:
1. Indirect distribution: This is a distribution strategy where a company sells its products to
consumers through middlemen (wholesalers, retailers, or distributors). Here, middlemen take
products from producers and sell them to consumers. The use of indirect distribution helps the
company to save costs of providing warehouses for the storage of products, purchasing vehicles
and employing salespersons for the distribution of the products. Middlemen bear these costs, but
however, these costs make middlemen to add to the prices of the products.
2. Direct distribution: This is a distribution strategy where manufacturers sell their products
directly to consumers. For a company to successfully use direct distribution strategy, it must
have a website where customers can access its products and place orders for them online or
through phone calls. This strategy is suitable for customers that are knowledgeable about online
technology. However, to facilitate direct distribution, companies must warehouses for the storage
of the products, vehicles for the movement of the goods, and delivery staff that will take the
products to the consumers. Additionally, manufacturers can set up retail outlets in different
locations to sells their products directly to consumers.
3. Intensive distribution: Also called mass distribution, intensive distribution is a situation where
a company distributes its product through multiple outlets. Intensive distribution is used when a
product is considered to have a large market. The reason for using intensive distribution is to

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 ensure that the product is easily accessed by customers so that customers do not buy competing
products. Impliedly, intensive distribution is used when there is a large range of competing
brands customers can choose from. Examples of products that require intensive distribution
include beverages, soft drinks, snacks, etc. These products are massively produced and they are
sold in many outlets like supermarkets, kiosks, stalls, bars and restaurants, etc.
4. Selective distribution: This is a situation where a company sells its product through a limited
number of outlets in a geographical area. Here, the company selects a few sales outlets for the
selling of its product to customers. Selective distribution allows producers to select the most
effective outlets to sell their products. Selective distribution is adopted when consumers have a
high preference for a product. In other words, selective distribution works best when a product
has a strong competitive edge over competing products and consumers are ever ready to search
out for the outlets that sell them. This type of distribution allows companies to have a close good
working relationship with their distributing outlets.
5. Exclusive distribution: This is a situation where a company uses only one intermediary
(wholesaler, retailer, or distributor) in a geographical area to distribute or sell its product. Here,
the company grants exclusive right to only one distributor to sell its brand to customers. The
distributor who is granted the right to sell must not be known for dealing in the products of
competitors. This type of distribution allows the company to have a firm control over the
distribution process of its product. This type of distribution is suitable for luxury or prestigious
products like Apple iPhone, cars, etc.

Importance of Distribution
1. Distribution helps companies in conducting marketing research for the development and sales of
goods according to the needs of consumers.
2. Participants of distribution channels help producers in the production of new products.
3. Distribution of goods at the appropriate time to consumers helps in the improvement of the living
standard of consumers.
4. Distribution helps to deliver products to consumers in the right quantity at the right place and
time.
5. Distribution creates a good communication link between the producer and the consumers through
the distribution channels.
6. Distribution creates jobs for people who work warehouse workers, transporters, distributors,
retailers, and wholesalers.
7. Distribution helps in satisfying the different needs of consumers.
8. Distribution helps producers in raising production capital as wholesalers are known assisting
producers with finance which is repaid using goods produced.
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 CHANNELS OF DISTRIBUTION

Meaning of Channels of Distribution

Channels of distribution refer to the various merchants products pass through before getting
to the final consumers. Products are produced by producers or manufacturers and such products
sequentially pass through the wholesalers and retailers before reaching the final consumers. The
wholesalers and retailers are the middlemen or link between producers and consumers. They help to
distribute the goods to the consumers. Production is not complete until the products reach the final
consumers. Hence, wholesalers and retailers are very important as they help to distribute products to
consumers. Below is a typical diagram of how products move from one channel to the other before
reaching the final consumer.

Producer Wholesaler Retailer Consumer

Wholesaler
The wholesaler is a merchant who buys goods in large quantity directly from the producer
and sells in small quantity to retailers. He is the middleman between the producer and the retailer.
Manufacturers heavily rely on wholesalers for finance than other channels of distribution like
retailers and agents.

Characteristics of Wholesalers
The characteristics of wholesalers are as follows:
1. Wholesalers buy products directly from manufacturers.
2. They buy products in bulk from producers and sell in smaller quantities to retailers.
3. They assist producers with production capital by buying products in large quantities.
4. They are concerned with the assembling of products.
5. They sell different varieties of a particular product line.
6. Wholesalers perform different marketing functions like warehousing, delivery of goods,
branding, etc.
7. They sometimes employ agents or workers for the distribution of products.
8. They give credit facilities to retailers.

Types of Wholesalers
There are many types of wholesalers. Some of them are briefly discussed as follows:
1. Merchant wholesalers: These are firms that buy and store products in large quantities and resell
the products in smaller quantities to other wholesalers and retailers. Merchant wholesalers are the

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 major wholesalers amongst other wholesalers. They take title to the products they buy and resell.
They brand and package the products they handle. They deal in certain types of products and
their services cover small geographical areas. They are known by different names such as
distributors, industrial distributors, jobbers, assemblers, and wholesalers. There are two types of
merchant wholesalers namely: full service wholesalers and limited service wholesalers. Full
service wholesalers are wholesalers that provide a full range of wholesale services such as
providing financial assistance to producers, warehousing, making deliveries, maintaining sales
force, and granting credit to retailers. On the other hand, limited service wholesalers are
wholesalers that provide limited wholesale services unlike full service wholesalers.
2. Manufacturer wholesalers: These are wholesalers that are involved in manufacturing their
products and selling the goods directly to retailers. They are companies that manufacture and
distribute their products themselves to retailers. They do not sell the products of other
companies.
3. Retail wholesalers: These are wholesalers who sell products to retailers and directly to
consumers. These retailers have direct contact with consumers and as a result, they receive
prompt information on consumers’ preferences. They are also able to reduce distribution costs
and increase their profits.
4. Pure wholesalers: These are wholesalers who buy products from manufacturers and other
wholesalers and sell only to retailers. They are neither involved in production nor selling directly
to consumers.
5. General merchandise wholesalers: These are wholesalers who sell different nonperishable
products of different manufacturers. These retailers handle unrelated product lines. These
retailers handle a wide range of products such as electronics, automobiles, power generators,
plumbing materials, etc.
6. General line wholesalers: These wholesalers deal in closely related products. Such wholesalers
only sell a particular line of products like either electronic products or automobile products. They
are also called single line wholesalers or industrial distributors.
7. Specialty wholesalers: These are wholesalers that deal in the products of a single or special
group of manufacturers. Some of them only sell a particular product.
8. Brokers: Brokers are middlemen who mediate between buyers and sellers. They link producers
and wholesalers or retailers together and help in the negotiation between producers and
wholesalers. Brokers are paid commission by the party (producer or wholesaler/retailer) who
hires them. They do not bear any financial risk and they do not take title to the goods.
9. Agents: These are middlemen who are hired by either sellers or buyers on a more permanent
basis than brokers. They are also paid commission by whoever hires them.

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Functions of Wholesalers
1. Wholesalers buy in large quantity from the producer, thereby, helping producers to constantly
remain in business.
2. They provide warehouses for the storage of goods so that they would not be scarce.
3. They break bulk for retailers. They sell in small quantities to the retailers who do not have
enough money to buy directly from producers.
4. They assist producers with finance or money to enable the producers to produce when they run
short of finance.
5. They help to stabilise the prices of goods by storing the goods in their warehouses and supplying
them to the market regularly.
6. They help to package and brand some of the goods produced by producers.
7. They advise producers based on the information they get from retailers.
8. They help to advertise the products of producers through trade fairs and exhibitions.
9. They advise retailers on the types of goods to buy and inform them of new products.
10. They give credit facilities to trustworthy retailers by allowing them to buy on credit and selling
to them at discount rates.
11. They help to transport goods to retailers’ shops, thereby, helping them to save transport cost.
12. They make wide varieties of goods to be available for retailers to buy.

Retailer
The retailer is a trader who buys goods in small quantity from the wholesaler or directly from
the producer and sells in units to the final consumers. He is the middleman between the wholesaler
and the consumers. Retailers sell their products in shops, supermarkets, kiosks, minimarts, etc.

Characteristics of Retailers
The characteristics of retailers are as follows:
1. They are the link between wholesalers and consumers.
2. They are the last intermediary in the distribution process.
3. They buy goods in relatively large quantities from wholesalers and sell in units or small
quantities to consumers.
4. They keep close contact with consumers.
5. They sell different products of different producers in their shops and hence, they are called
general merchants.
6. They display their goods in their shops to attract consumers.
7. They recommend products for consumers.
8. They are familiar with the quality and effectiveness of different products.
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9. They are highly concerned about giving maximum satisfaction to their customers.

Types of Retailers
There are two main types of retailers namely: small scale retailers and large scale retailers.
They are briefly elucidated as follows:
1. Small scale retailers: These are retailers who sell in small retail outlets. They stock and sell
limited quantities of products. Some only deal in one product line. Examples of small scale
retailers include street vendors, market traders, kiosk owners, hawkers, and stall owners.
2. Large scale retailers: These are retailers whose retail outlets are big. They stock and sell large
quantities of a wide range of products. Large scale retailers include supermarkets, departmental
stores, chain stores or multiple shops, and discount houses.

Functions of Retailers
Retailers perform the following functions:
1. Retailers stock and sell a wide range of products to satisfy the different needs of consumers.
2. They sell in units to consumers who cannot buy in large quantity from wholesalers.
3. They give credit facilities to consumers by allowing them to obtain goods and making payment
for them in the future.
4. They render after-sale services to consumers like installation, giving direction on how to use a
product, etc.
5. They take goods nearer to consumers.
6. They advertise products on behalf of producers and wholesalers by displaying the goods in a
fancy way in their shops.
7. They advise consumers on the types of products to buy and how to use them.
8. They render customised services and give personal attention to consumers in order to maximise
consumer’s satisfaction.
9. Retailers help to inform consumers of new products and show them how the new products are
used.
10. They give information to wholesalers on the needs of consumers.
11. They help to free producers and wholesalers from the stress of taking products to consumers
themselves.
12. Some retailers help to fund wholesalers by making advance payments for products.

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 CONSUMER IN THE CHANNEL OF DISTRIBUTION

Consumer
A consumer is a person or a group who orders, buys, and makes use of products to meet
personal, family, and social needs. Consumers are the end-users in the channel of distribution. They
buy products to satisfy their personal, family, and social needs and not for the purpose of reselling
the products or using the products to produce other products.

Characteristics of Consumers
The following are the characteristics of consumers:
1. Consumers exercise supremacy. They expect sellers to highly treat them with respect and respect
their choice of product.
2. Consumers tend to expect personal interaction from sellers.
3. Consumers easily switch from one product or seller to the other.
4. Consumers are influenced by advertisements and other consumers.
5. Consumers desire brands or products that are safe for use and environmentally-friendly.
6. Consumers are highly opinionated. They have negative or positive opinions about different
products.
7. Consumers share their experiences with products through different means.

Types of Consumers
The different types of consumers are elucidated as follows:
1. Personal consumers: These are individuals who buy products to meet their personal and family
needs.
2. Organisational consumers: These refer to organisations, businesses, and government who often
buy products in bulk to meet their organisational consumption needs.
3. Loyal customers: These are consumers that are committed to buying product. They can hardly
change from a brand to another. These consumers are only a small percentage of a company’s
customer base, but they help in recommending the company’s products to others. Loyal
customers can also be called habitual consumers.
4. Impulse shoppers: These are consumers who buy goods without prior plans of buying the
goods. They quickly make buying decisions the moment they come in contact with products that
appeal to their emotion. Eye-catching and cheap products usually appeal to impulse shoppers.
5. Need-based consumers: These are consumers who buy products when they actually have need
for the products. These consumers only buy products they immediate need for. They do not buy
on impulse.

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6. Discount-driven consumers: These are consumers who buy products only when discounts are
being offered on them. Discount-driven consumers are highly price sensitive and wait until the
products they like are being sold at discounts before they buy.
7. Bargain hunters: These are consumers who always seek for the best or cheapest prices before
making purchases. These consumers cannot be sweet-talked into buying a product. They delay in
making buying decisions until they get the best deal.
8. Wandering customers: These are consumers who enter a shop because of its attractiveness but
not with the desire to buy. These consumers have little or zero interest towards buying, but ask
questions about random products. However, giving wandering customers good responses to their
questions may make them potential future customers.
9. New customers: These are consumers who have just bought a product from a seller for the first
time. Such customers need to be given adequate help on the use of the product. This can make
them become loyal customers.
10. Potential customers: These consumers are yet-to-be customers of a seller. They are consumers
that need to be convinced and motivated to buy a product.

Consumer Rights
Consumer rights are the rights of consumers to purchase and use products that will not cause
them any harm. Consumer rights are the rights of consumers to have correct information about the
price, safety, standard, and quantity of the goods they are buying. Consumer rights demand that
producers must do whatever they need to do to ensure that their products do not cause any harm to
consumers. The rights are tailored towards protecting consumers against any fraudulent and criminal
act of producers. These rights are enforced using relevant consumer protection agencies and
legislations in different countries. In Nigeria, these rights are contained in and enforced using the
Consumer Protection Council Act (2004). Some of the consumer protection rights are as follows:
1. Right to safety: Goods sold to consumers must be safe for them to use. The goods must not
cause any harm or injury to them.
2. Right to choose: Consumers must be given the assurance to make choice of whatever product
they can buy at a given price. They must not be compelled to buy any product.
3. Right to be informed: Consumers must be given correct information on the price, quality, and
quantity of the good they are buying. They must not be misled into buying a product.
4. Right to consumer education: Consumers must be given knowledge of how the products they
are buying work and provided skills on how to use the products.
5. Right to seek redress: Consumers have the right to seek redress against unfair trade practices
and exploitation by sellers. Consumers must be compensated if damage is done to them by
sellers.
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6. Right to be heard: Consumers have the right to represent themselves in the law court for their
voice to be heard. They have the right to form consumer associations through which their voice
can be heard in any forum.

Functions of the Consumer

Consumers in the channel of distribution perform functions that are beneficial to not only
themselves, but also producers or sellers. Some of the functions of consumers are elucidated as
follows:

Functions of consumers that benefit producers

1. Market research: Consumers enable companies to conduct marketing research on their
products. When producers are about to send new products to the market, they carry out survey to
get information from consumers to determine consumers’ preference for their products and to
determine the prices they are to fix on their products.
2. Product feedback: Producers get feedback on their products from consumers after lunching
product. This enables producers to make appropriate adjustment and improvement on their
products.
3. Introduction of new customers: Some consumers help to advertise the products they a loyal to
through word-of-mouth to other consumers. By this act, they help producers or sellers to get new
customers.

Functions of consumers that benefit consumers

1. Consumers ensure that whatever product they are buying is of standard and safe for
consumption.
2. Consumers try to understand available information about products before making a buying
decision.
3. Consumers endeavour to follow laid down rules and regulations while buying products.
4. Consumers carry out the duty of requesting for the receipts of purchase from sellers so that
where there are issues with the products purchased, the issues can be easily resolved.
5. Consumers carry out the duty of fighting against unfair and exploitative trade practices of sellers.
6. Consumers have the duty of forming non-political associations through which they can express
their needs and protect their consumer rights.

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 CHOICE OF DISTRIBUTION CHANNELS

Factors that Influence the Choice of Distribution Channels

Several factors influence the choice of distribution channels adopted by producers. However,
these factors can be grouped into market related factors, product factors, company’s factors, channel
related factors, and environmental factors. These factors are explained as follows:

Market Related Factors

The market related factors include the following:
i. Customers: If the customers are many, widely spread, and buy in small quantities, a wide
distribution channel will be adopted to effectively reach them. However, if the customers are few
in number, not widely scattered, and buy in large quantities like industrial buyers, a direct
distribution channel will be required.
ii. Competition: Companies adopt distribution channels that have been effective for their
competitors. Companies run from distribution channels that have failed their competitors.
iii. Suitability of existing channels: Companies decide on using an existing distribution channel
after studying it suitability, advantages, and disadvantages. Therefore, if an existing channel is
considered suitable and advantageous for a new product, it will be adopted.

Product Factors
The product factors are as follows:
i. Perishability of product: A short channel or direct marketing is most suitable for distributing
perishable products such as meat, vegetables, etc. A short channel quickens the selling of a
product. However, a long channel can be employed to distribute nonperishable products like
television sets, utensils, etc.
ii. Nature of the product: Consumer goods which are bought by a wide range of consumers and in
small quantities require long channels of distribution consisting of many retailers. On the other
hand, industrial goods are bought by a small number of buyers who are well informed and in
large quantities. Such goods require shorter channels of distribution.
iii. Technicality of product: There are products like computer hardware and software that are very
technical in nature which require a high level of technical support from the manufacturers. Such products
are best distributed by manufacturers’ salespersons that have the technical knowledge of the products. On
the other hand, longer channels of distribution are used for products that do not require technical support.
iv. Variety of products offered: If the products of a manufacturer are very few, it is best to use long
channels of distribution. However, if a manufacturer produces a wide range of different products, it is best
to adopt a short or direct distribution channel.

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v. Unit value of product: While long channels of distribution are required to distribute products with low
unit price which are massively consumed, shorter channels of distribution are required to distribute
products with high unit price.

Company’s Factors
The company’s factors include the following:
i. Company’s financial strength: A company with little financial strength usually makes use of
existing channels in distributing its products because it cannot afford new ones. Contrarily, a
company with a strong financial strength can spend money to design its own distribution
channel.
ii. Level of desired control: If a company wishes to have a high level of control over distributors
in matters like territory restriction, resale price, etc., the company makes use of a short
distribution channel.
iii. Company’s reputation: Distribution intermediaries highly associate themselves with companies
with strong reputation. Hence, companies with strong reputation can afford to make use of long
distribution channels in distributing their products.
iv. Company’s marketing policies: Companies adopt a distribution channel which aligns with their
marketing policies. Therefore, a company can either choose to use longer or shorter distribution
channels provided the adopted channels reflect the marketing policies of the companies.
v. Past experience: A company existing over the years has past experience with different
distribution channels. The company duly considers its past experience with the different
distribution channels before deciding on the one to use.

Channel Related Factors

The channel related factors include the following:
i. Ability of the channels: Manufacturers opt for using channels that have the ability to distribute
their products effectively over a wide area. Such channels have been long established and are
very strong. However, newly established channels are not strong enough to effectively distribute
products over a wide coverage.
ii. Financial strength of the channels: Manufacturers opt for channels with the financial ability to
immediately make cash payment for their products. Such channels can even finance
manufacturers directly.
iii. Ability to provide after sales services: Some products need sustainable after sales services. As
such, manufacturers consider the ability of distribution channels to provide effective after sales
services in a sustainable manner before opting for them.

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Environmental Factors
Certain factors in the environment (country or place) in which manufacturers, distribution
channels, and consumers exist must be duly considered when making choice of distribution channel.
The environmental factors include the following:
i. Economic situation of the country: In a situation where a country is faced with economic
hardship or recession, sales generally drop and most channels of distribution are very unwilling
to embark on distribution. However, during economic boom, demand for products is very high
and distribution channels are ever ready to take up distribution. Companies must opt for
distribution channels that can distribute their products effectively during harsh and friendly
economic periods.
ii. Legal factor: Companies have to ensure that the activities and operations of distribution
channels are legally recognised by the law of the land before opting for them. Companies
distribute their products through channels that are considered lawful in the country.

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 TRANSPORTATION

Meaning of Transportation
Generally, transportation, also called transport, refers to the process of moving people,
goods, and animals from one place to the other. In marketing, transportation specifically refers to the
physical movement of products from where they are produced or stored to where they will be
needed. It involves using various means to physically carry products from manufacturers and
distributors to consumers. Transportation makes it possible for manufacturers to take their products
to consumers and for consumers to access the products of manufacturers. Transportation enhances
the performance of various marketing activities of warehousing and distribution.

Importance of Transportation in Marketing

Transportation is important in marketing in the following ways:
1. Transportation helps in the easy movement of goods from one part of the country to the other,
thereby promoting easy flow of internal trade.
2. Transportation makes it possible for the agricultural and industrial products of different countries
to be sold in different countries of the world, thereby enhancing free flow of international trade.
3. Transportation takes products closer to consumers.
4. Transportation enables consumers to have access of variety of products which they require to
enhance their standard of living.
5. Transportation creates employment for different people such as company drivers, commercial
drivers, suppliers of vehicle spare parts, and mechanics.
6. Transportation promotes efficiency in business negotiation and transaction.
7. Transportation helps businesses to physically meet their customers.
8. Transportation promotes the performance of after-sales services for customers.
9. Transportation enhances mass production of products and price stability.
10. Transportation helps businessmen and the country in general to acquire businesses ideas and
strategies from other countries.

Modes of Transportation
There are three modes of transportation. They include road transportation, land
transportation, and water transportation. They will be respectively elucidated as topics of their own.

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 LAND TRANSPORTATION

Definition of Land Transportation

Land transportation is the movement of people and products from one place to the other on
land. Land transportation is the oldest form of transportation. Since the origin of man, man has been
involved in using land to move people and products from place to place through land. There are two
main forms of land transportation. They are road transportation and land transportation.

Road Transportation
Road transportation, also called motor transport, involves the movement of people and
products from one place to the other through road using vehicles such as bicycles, motorcycles,
tricycles, cars, buses, trailers, trucks, etc. Through roads, vehicles are used to carry people from one
destination to the other.

Advantages of Road Transportation

1. It is the cheapest means of transportation. This is because road transport requirements like
garages, car parks, cars, trucks, etc. are cheaper to afford than the requirements for water
transport like seaports, cargoes, ships, etc. and requirements for air transport like airports and
aircrafts.
2. It is the most agile means of transportation. It does not take long for boarded vehicles at garages
and parks to take off.
3. It is the most suitable means of transport for short and medium distances.
4. It is the most flexible means of transport as road transport schedules and routes can be
conveniently changed at anytime.
5. It is the most suitable means of transport for transporting any type of product whether heavy or
light, cold or hot, inflammable or noninflammable, toxic or harmless, etc.
6. In road transport, vehicles and goods can be easily traced or tracked especially with the help of
technology like GPS.
7. Road transport guarantees door-to-door service. It makes it possible for goods to be loaded from
wherever they are bought and delivered to any destination of the buyer. This helps to reduce
delivery, loading, and unloading costs.
8. Road transport involves simple paperwork. The processes and time for documenting goods to be
delivered via road transport are very short.
9. It is the most suitable means for delivering goods to rural areas without rail, water, and air
transport means.

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Disadvantages of Road Transportation
1. Road transportation is not as reliable as rail transportation because it can be hindered by heavy
rainfalls that negate safe driving as well as destroying tarred roads.
2. Road transportation has a high occurrence of accidents due to bad roads and careless driving on
the part of drivers.
3. It has a high occurrence of vehicle breakdown due to bad roads.
4. It is costly or unsuitable for transporting cheap and bulky goods over long distances.
5. The speed of road transport is slow when compared to the speed of air transport. Aircrafts are
speedier than cars, trucks, buses, etc.
6. It is associated with unstable or irregular charges.

Rail Transportation
Rail transportation, also called railway transport, refers to the carriage of people and goods
using vehicles that run on rails. It involves using trains which run on railway tracks. Rail transport is
highly suitable for carrying bulky goods like heavy duty machines and equipment from place to
place.

Advantages of Rail Transport

1. It is generally a cheap means of transport. The cost of boarding railway trains is far cheaper than
the costs of using some other means of transport like buses and aircrafts.
2. It is the most reliable means of transportation as it is not affected by climatic conditions like
rainfall, dews, etc. The movement of trains is unhindered by climatic conditions like rainfall,
harmattan, etc.
3. It is a well organised form of transport as its schedules and routes are fixed.
4. It has a higher speed over long distances than road transport and water transport.
5. It is cheap, fast, and suitable for moving heavy products over long distances.
6. Railway transport has a large carriage capacity. Trains have the capacity to convey more
passengers and goods than other means of transport like cars, buses, trucks, etc.
7. Railway transport is the safest mode of transportation as it has a minimum rate of accidents and
breakdowns.

Disadvantages of Rail Transport

1. The construction of railway station and railway tracks and purchase of purchase of trains require
huge capital investments.
2. It is an inflexible means of transport as its schedules and routes cannot be adjusted to suit
individual destinations.

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3. It does not provide door-to-door transport services as trains are only tied to a track.
4. Railway transport consumes time and labour in the course of delivering goods.
5. It is not suitable for carrying breakable or fragile goods like ceramics, television sets, glass
products, etc. This is because such products can easily be damaged when trains stop or increase
their speed unexpectedly.
6. Railway transport cannot be used to transport goods on emergency grounds because of its fixed
booking schedules.
7. It is not suitable for carrying goods over short distances.

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 AIR TRANSPORTATION

Definition of Air Transportation

Air transportation refers to the carriage of people and goods through air using aircrafts like
airplanes, helicopters, and jets that fly in the air. Air transportation is the newest but the fastest form
of transportation. Air transportation originally started in 1903 and started evolving in the 1930s.

Advantages of Air Transportation

The advantages of air transportation are as follows:
1. It is the most suitable and effective means of transporting people and goods over long distances.
2. It is the fastest means of transport and it thus helps to reduce the delivery time of products.
3. It is a comfortable means for transporting people across far distances around the world.
4. It makes it possible for goods to be conveniently carried from one country to another as a result
of its high speed.
5. It highly promotes international trade. It makes it possible for a country to trade with other
countries of the world.
6. It increases the volume of trade amongst countries of the world as it encourages more goods to
be produced around the world.
7. It enables companies to sell their products in numerous and far countries around the world.
8. Air transportation does not require spending money to build tracks for the passage of aircrafts. It
only requires money for the building of airports.
9. Air transportation is not hindered by physical barriers like trees, bad roads, rivers, floods,
mountains, and valleys.
10. Air transportation is used to take people and products to places that cannot be accessed using
other transport means.
11. It is the most suitable means for transporting people and goods during emergencies like floods,
earthquakes, wars, etc.
12. It is the most suitable means for transporting goods that are perishable in nature which require
quick delivery.
13. It is the most suitable means of transporting light goods with high value such as gold, diamond,
and even currency notes and vital documents over long distances.

Disadvantages of Air Transportation

The disadvantages of air transportation are as follows:
1. Air transportation requires huge financial investments because of the high costs of building and
maintaining airports, and the high costs of buying and maintaining aircrafts.

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2. It is the most expensive form of transportation. Air transport fares are very expensive.
3. It is the riskiest form of transportation due to occurrences of plane crash and plane hijacking
which could end the lives of people.
4. Air transport is unreliable being that it is hindered by bad weather.
5. It has small carriage capacity. As a result, it is not suitable for carrying cheap and bulky
products.
6. It is hindered by many legal restrictions that are imposed by the governments of different
countries for national interest purpose.

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 WATER TRANSPORTATION

Definition of Water Transportation

Water transportation refers to the carriage of people and goods across creeks, rivers, lakes,
seas, and oceans using boats, sailboats, barges, and ships. Water transportation is older than air
transportation and railway transportation. However, it is the mode of transport with the largest
carriage capacity. It carries the largest of bulky goods over long distances.
Water transport is divided into inland water transport and ocean transport. Inland water
transport involves carrying people and goods through small water bodies like rivers, canals, and
lakes which are not as large and deep as oceans. Inland water transport covers a limited geographical
coverage. Inland water transportation cannot be used to convey people and goods over far distances.
Ocean transportation involves carrying people and goods through large and deep water
bodies (seas and oceans). Ocean transportation has unlimited geographical coverage. It is most ideal
for carrying people and goods over long distances. It is through ocean transportation bulky goods
can be shipped from one country to the other.

Advantages of Water Transportation

The following are the advantages of water transportation:
1. It does not require spending money to build passageways for boats, ships, etc.
2. It is most economical and suitable for carrying bulky products across long distances at low cost.
3. It is suitable for transporting perishable and nonperishable products across short and long
distances.
4. It highly enhances international trade as it serves as a channel for moving all kinds of products to
different parts of the world.
5. Water transportation is to a great extent not hindered by weather. For instance, ships can move
during overcast weather or heavy downpour.
6. It is very suitable for transporting products to places that cannot be reached using land or rail
transports during natural disasters like floods and tsunamis.
7. It is relatively a safe means of transport due to the low probability of the occurrence of accidents
like collision of boats or ships.

Disadvantages of Water Transportation

1. It is slow or time-consuming and as a result, it may cause delay in delivering products.
2. It is not reliable for delivering goods to meet urgent needs because it is slow in nature.
3. It is to a great extent not suitable for delivering perishable products because of its slowness.
4. It is a risky means of transport due to the danger of sinking of boats or ships.

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 CHOICE OF TRANSPORTATION

Factors Influencing the Choice of Transportation

The following factors must be considered when choosing the choice of transport:
1. Cost of transport: Companies go for the most suitable transport mode with the cheapest
financial cost implication to move their products. For instance, a company will opt for water
transport which is cheapest and most suitable to carry its heavy and bulky products over long
distances.
2. Speed of transport: Companies go for transport modes that are speedy enough to timely deliver
their products to customers. Where the delivery time is verily short, a company may opt for using
air transport and not water transport which is very slow.
3. Flexibility of transport system: In a situation where goods will be delivered at different
locations, companies go for a transport system that does not have fixed routes or can take
products to different locations. Road transport is highly flexible as it can deliver products to
different locations.
4. Carriage capacity: Companies consider the ability of a transport means to carry their products
in large quantity before opting for it. Therefore, companies will not opt for a transport means that
do not have the capacity to transport their heavy and bulky products.
5. Safety: Companies opt for a transport means that will not cause damage to or loss of their goods
in transit. Therefore, if a transport means is cheap, cannot guarantee the safety the goods in
transit, companies would not go for it.
6. Nature of product: Companies are expected to use road transport or air transport to transport
products that are perishable in nature which require quick delivery. For nonperishable and bulky
products, which do not require quick delivery, companies opt for rail transport and water
transport.
7. Regularity of transport service: Companies go for a transport mode with regular or
undisrupted services. Railway transport is more regular and certain than other transport means as
it is not affected by bad climatic conditions like storms, heavy rainfalls, etc.

Documents used in Transportation in Marketing

The following are the documents used in transportation:
1. Waybill: This is a document which contains an acknowledgement that the carrier has received
the goods for transport. Waybill shows that the carrier has agreed to transport goods on behalf of
the consignor or consignee.
2. Air waybill: This is a document used in air transport which shows that an air carrier has agreed
to transport goods from one airport to another.
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3. Railway receipt: This is a document of acknowledge of of receipt of goods by a railway for
transport. It is a document of evidence which shows that a railway has agreed to transport goods
on behalf of a consignor or consignee. It is only on presentation of the railway receipt that a
railway will deliver the goods.
4. Charter party: This is a document that shows that the whole or a part of a ship has been hired.
Charter party is also called voyage charter or time charter. A ship is hire when goods are to be
shipped in a large quantity. The person who hires the ship is called charter and he is liable for
any damage to the ship in the period of hire.
5. Bill of lading: This is a document which is issued by a shipping company and signed by a
captain acknowledging of receipt of goods to be shipped by him. The document serves as an
official receipt of the goods and it contains the terms and conditions of the contract of carriage or
shipment. The document describes the nature of the goods. It also contains the name of the ship,
name of the shipper or exporter, place of shipment, freight paid or to be paid, date of shipment,
date of delivery, and name of the person to receive the goods on delivery.
6. Freight bill: This is a document or an invoice carriers issue to shippers which indicate all
expenses incurred in the course of shipment. The document contains details of the goods being
shipped, weight of goods, place of shipment, place of delivery, and all charges paid.
7. Delivery note: This is a document which is used to indicate that goods have been delivered to
the buyer or consignee. The delivery note is signed by the buyer or consignee and returned to the
seller or consignor as evidence of delivery.
8. Cargo insurance certificate: This is a document that shows that the goods in transit have been
insured. Cargo insurance certificate shows the type of insurance policy covering the goods being
shipped and the amount of insurance fee paid. It also contains the name of the insurance
company and the terms and conditions of the insurance policy covering the goods.
9. International commercial invoice: This is a document that contains details about an
international sale. It contains the nature of the good, its quantity, the price at which it was sold,
taxes paid on the good, delivery conditions, and payment conditions. This document is prepared
by the exporter and addressed to the importer and the import customs clearance.
10. CMR document: CMR is an acronym for “convention relative au contrat de transport
international de marchandises par route”. CMR document which contains the responsibilities
and liabilities of parties to a contract for the carriage of goods by road internationally. This
document is used by drivers, operators, and forwarders who are involved in carrying goods from
one country to the other by road. The document is filled and signed by the consignor to affirm
the accuracy of the information about the goods. It is also signed by the consignee on receipt of
delivery to enable the carrier to confirm delivery and request for payment for his services.

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