IMPORTANCE OF DISTRIBUTION CHANNEL TO THE MARKETING

OF A PRODUT IN AN ORGANIZATION
(A CASE STUDY OF EMZOR)

ABSTRACT

This project titled importance of distribution channels of the marketing of a project in an

organization. Distribution is an important activity in the integrated supply – chain
management of pharmaceutical products. Various people and entities are generally
responsible for the handling, storage and distribution of such products. In some case,
however, a person or entity is only involved in and responsible for certain elements of the
distribution process. The researcher used the secondary source of data collection method
involved sourcing information from the relevant textbooks, magazine, journals and the
internet. It was observed in this study that a poor channel of distribution is the root cause
to their high cost of production, therefore, any organization that desire to achieve its goal
and objectives efficiently and effectively must as a matter of necessity increase it control
over it distribution channel and monitor their activities more effectively.
 TABLE OF CONTENTS

CHAPTER ONE: INTRODUCTION

1.1 Background to the Study
1.2 Statement of the Problem
1.3 Research questions
1.4 Research Hypothesis
1.5 Purpose of the Study
1.6 Scope of the Study
1.7 Significance of the Study
1.8 Limitations of the Study
1.9 Operational Definition of Terms

CHAPTER TWO: LITERATURE REVIEW

2.1 Introduction
2.2 Literature Review
2.2.1 Marketing Channel Function
2.2.2 Distribution
2.2.3 Channel Conflict
2.2.4 Ways of Reducing the Conflict
2.2.5 Factors Affecting Choice Distribution Channels in an Organization
2.2.6 Physical Distribution
2.2.7 The Nature of Physical Distribution
2.3 Summary of the Review

CHAPTER THREE: RESEARCH METHODOLOGY

3.1 Research Design
3.2 Population of the Study
3.3 Sample/Sampling Techniques
3.4 Instrumentation
3.5 Data Collection/Analysis
CHAPTER FOUR: DATA ANALYSIS, INTERPRETATION AND DISCUSSION
4.1 Introduction
4.2 Data Analysis
4.3 Data Interpretation
4.4 Discussion of Findings
CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Summary of Findings
5.2 Conclusion
5.3 Recommendations
5.4 Areas for Further Research
References
Appendices

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 CHAPTER ONE
INTRODUCTION
1.1 BACKGROUD TO THE STUDY
Distribution channel is one of the major factors that can ensure the success of any
organization.
The distribution channel is of a great important in the marketing of goods and services. The
activities involved in the production and distribution of goods and services is for it to get to the
ultimate users. Consumers satisfaction being the vocal point in making effects, must be put together
to affect the effectiveness of distribution channel decisions.
The distribution decision is concerned with selecting and locating middlemen to effectively
move product from factory to consumer or customers. The objective is to organize a system of
transportation storage and communication that will make the goods and services available to
potential consumers. To be cost conscious the system must minimize the cost of storing and
shipping merchandize while maintaining and improving sales to the ultimate consumers in addition
to the channel members must be effective to do better job making the company’s product available
to the final consumers. Hence in selecting a distribution channel many variables must be taken into
consideration, this variable might include most of the times the nature of the product, the targeted
customers, location, and the financial ability of the company, economic factor and available
channels of a particular point in time. One of the roles in distribution channel is to convert potential
buyers into profitable buyers. In order words channel member must not just serve market but must
also make market. The distribution channel ensured constant flow of products form the point of
production to the consumption at the time. The most imitative product that have price and promoted
attractively is worthless without effective distribution channel.
Thus the distribution channel members can create place and time utility to facilitate
possession utility.

1.2 STATEMENT OF THE PROBLEM

For instance, the Nigeria bottling company was incorporated in 1953, today; it has other
branches located in various part of the country. Emzor, Emzor, and Crest bitter Lemon, Eva water
and Five alive are heavily distributed to dealer from being plant, the question is whether it is
heavily distributed within the state or not if the quality of the product is nothing to write home
about, it must be known here that the quality does not worth it to satisfy the consumers need. The
Nigeria consumer actually, is not caught by any diplomatic attitude towards foreign goods.

1.3 RESEARCH QUESTIONS

The following are the research questions;
i) What are the channels of distribution channel?
ii) What are the importances of distribution channels strategies used by the organization?
iii) What are the distribution channels and problems facing an organization?

1.5 RESEARCH HYPOTHESIS

For a pave been drawn as a guide to the research work and will be tested for validity in
Chapter four
Hypothesis One
HO: Distribution helps to inform the potential buyer as regarding the existent of a new product
HI: Distribution does not help to inform the potential buyer as regarding the existing of a new
product.
Hypothesis Two
HO: Frequently distribution channel of marketing product lead to loyalty and higher sales.
HI: Frequently distribution channel of marketing product does not lead to product loyalty and
higher sales.
Hypothesis Three
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 HO: Distribution of a product constitutes a reason for the consumer to buy such product.
HI: Distribution of a product do not constitutes a reason for the consumers.

1.5 PURPOSE OF THE STUDY

The objective of the study refers to the aims the researcher wants to achieve in the research
work. This project work title ‘the importance of distribution channel in marketing of a product in an
organization’
i) To identify the channel of distribution channel
ii) To evaluate the importance of distribution channels strategies used by the organization
iii) To determine the distribution channels and problems facing an organization
iv) To improve and provide suggestion, solution by the way of recommendation to the problems in
the course of this research work.

1.6 SCOPE OF THE STUDY

The scope of the study is limited to Benin Zone of Emzor, this zone comprises of the Benin
basic territory and the company’s dealer outlet in the zone.
The study tries to analysis the importance of the distribution channel in the attainment of the
firms’ objective and its benefits to customer and in an organization.

1.7 SIGNIFICANCE OF THE STUDY

This research work will be of significance to many companies when completed
Firstly, the study had obviously showed whether it is advisable for Emzor pharmaceutical industries
to continue
It current distribution system or to do away with it as a result of the high cost of it’s method of
operation efficiency of the distribution channel used by Emzor will definitely bring about increase in the
sale of line of pharmaceutical products, which will result in increase in prefect to the company. Also to
benefit one other pharmaceutical companies and representative of multinational enterprise in Nigeria.
Secondly, it will also be of significance to consumer and middlemen in the sense that their
suggestions criticism will be taken into consideration.
Finally, efficiency of distribution channels sought by the study will obviously improve the
economic development of Nigeria in terms of adequate health care facilities drugs supply to the market.

1.8 LIMITATION OF THE STUDY

In the course of carrying out this study the student encountered the following problems.
i) Poor performance from the firm (Emzor pharmaceutical) this is because they were scared that the
information given might be disclosed to their rivals.
ii) Financial constrains also contributed adversely to the scope which would have covered a large
scope and could covered for better respondents were very subjective.
iii) Finally, most respondent were very subjective as they perhaps feared that the result of the study
might have negative effect on them.

1.9 OPERATIONAL DEFINITION OF TERMS

Distribution: It is the process or system of transporting and delivery goods from a particular area
or among to a particular group of people.
Marketing: According to Kotler (1980) defines marketing which says that marketing is human
activity directed at satisfying needs and wants through exchange process.
Channels: A method or system that people use to communicate, or to send something
somewhere to send products using a particular route.
Organization: Is define as a group of people who form a business together in order to achieve a
particular aim, is made up of people living together in an area or in an entity.
Customer: This is define as the ability to buy more on a regular basis
Consumers: Is a person, who buy goods or uses services, it is the ability to use something.
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 CHAPTER TWO
LITERATURE REVIEW
2.1 INTRODUCTION
This involves information that exists in journal, articles and textbooks written by various
authors on the matter.
The distribution of product involves the physical movement of product to ultimate
consumer; it has been receiving much attention in marketing oriented companies and business
organization because of it importance in getting the product or services to the right place at a low
cost for the potential consumer to buy.
A lot of authors have written on the definition of distribution. Charles and Smith wrote that
distribution is a key element of providing satisfaction in the market place. It also involves the
physical movement of product to ultimate consumers.
According to Lazo (2013), distribution is the entire function of getting goods into the hands
of consumer these functions according to him includes transportation in the broadest sense as well
as the middlemen who handle the goods and help to transfer title to the goods.
Nwokoye (2012) agree with Smith (2010) by stating that the gap, space and time between
production. He further said distribution can be viewed as a strategic management system.

2.2 LITERATURE REVIEW

2.2.1 MARKETING CHANNEL FUNCTION
A marketing channel is essentially a method of organization that has to do with the
movement of goods from producers to the consumers. The purpose of the work is to overcome
various gaps that separate the goods and services from those who would use them. The work of
middle is designed to create time, place and possessions utilities.
The following are marketing channel function.
1. Promotion: The development of dissemination of persuasive communication about the offers
2. Research: The gathering of information necessary for planning and facilitating exchange.
3. Negotiation : The attempt of reach final agreement, as price and other terms of the offer so that
transfer of ownership and possession can be affected.
4. Financing: The acquisition and dispersal of fund to cover the cost of channel work
5. Basic Bearing: The assumption of risk in connection with carrying out these channel work.
6. Physical distributions: The transportation and storing of goods, identifying the major channel
alternative

2.2.2 DISTRIBUTION
Distribution as one of the important element in marketing, it helps to strategies
planning .The major task is to make goods available where and when needed .This bridge a gap
between production and consumption.
When a company has defined its target market and desired positioning, the next attempt is to
identify its major channel alternatives are described by three elements mentioned below.
1. Number of intermediaries: The number to use on each sage is influences by the degree of market
explosive sought by the company. These degrees of market explosive can be distinguished
2. Intensive distributions: This simply means mass distribution, the stocking of this product in many
outlets as possible of convenience goods. According to Phillip K. (1980) intensive distribution
reduces the difficulties of consumer decision making process. The dominant factor in marketing of
those goods in their place of utility.
3. Exclusion Distribution: Some producer deliberately limits the number of intermediaries in
handling their products. The extreme from of there is exclusive right to distribute the company
product.
4. Selecting Distribution: This involves the use of one but then all of the intermediaries who are
willing to carry a particular product. It is used by both established companies with good reputation
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 and by new companies seeking to obtain distribution by promising them selective distribution. It
can developed a good working understanding with the selected intermediaries and expect than a
better average selling effort (Imafidon, 2012).

The product must determined the mix of conditions and responsibilities to be assumed by
different channel member, the main element are the price policy, the condition of sales, the
territorial right and the specific service to be performed by each party. Price policy is one of the
major elements in the trade relation mix.
The produces usually established a list price and them allows discount from it to various
types of middlemen and possibly for various quantities purchased.
Most producers grant cash discount to their distribution for early payment (Joel, 2012).

2.2.3 CHANNEL CONFLICT

Middlemen may not co-operate with manufacturers firm unless they see benefit for
themselves. This is because; they are independent businessmen who lookout for themselves. This
lack of co-operation brings out manufacture’s dealer conflict. The conflict result when the
manufacturer or middlemen cannot achieve the desirable goal unless they reduce the possibility of
other firms achieving goals.

2.2.4 WAYS OF REDUCING THE CONFLICT

Usually, conflicts are harmful and they must be reduced or removed. The best way to do this
is for two parties to have loser contact between themselves, this allow for the better understanding
some established manufacturing, financial engineering and marketing. It was the believe of Michael
Baker (2014) that there are three other established ways of reducing conflict, they are
1. Administered System: Where there are acceptably structure on formalized system, agreed
upon producer which should be followed in details for remedying conflict.
Service of Intermediaries
Intermediaries are people who buy product from various producers to sell to retailer, to their
wholesalers, to instruction such as school, churches, Hotels and to any organization other than
ultimate retailers.
2. Supply of market information: Very often when the manufacturers distributes his goods through
intermediaries. A vacuum may be created between information, from time to time, this will help
him to adjust defective product and even assist him one new development. The intermediaries will
supply, therefore it includes communication, on movement of spices, behavior of competitors and
availability of goods (Bennard, 2012).
 Change of ownership or title of goods: The intermediary enable the consumer to obtain title of
goods which are hitherto produced by manufacturer e.g. if Honda is produced by Japanese and
distributed them one could say that the administered system is being used.
 Contractual System: This is where conflict is attempted to be reduced by a means of legal
agreement, this can be done only to solve a particular problem or applied to solve very similar
problem.
 Operate System: When the administered systems are unable to reduce manufacturer or dealer
channels conflict them the corporate system is used. The manufacturer itself performs the
wholesaling and retailing function.
2.2.5 FACTORS AFFECTING CHOICE DISTRIBUTION CHANNELS IN AN ORGANIZATION
According to Barnard (2012), the manufacturer of consumers’ goods has three main
distribution channels. He can sell to wholesales in bulk and resolve directly to the consumers,
probably in every small qualities or individual units. The choice of which distribution method
depend upon many factors and the marketing manager with few product to bring to the market will
weight it carefully before he decide his policy.
i. Nature of the product: Here it is important to look at the composition size or weight of the
product, where the produce is of a perishable nature such as vegetables than a direct route from the
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 producer the consumers will save the product from deteriorating. The weigh of a could further
determine whether to use a direct channels. The complexity of the product and the extent of after
sales are also anther important aspect. Where are important, the manufacturers will obviously
favour a direct sales making use of its established sales outlet. But where there is availability of
distributors the manufacturer may sell through such outlets when competent, technical sales outlets
exist.
ii. Market: Here the manufacturers may have to spread the market. The consumer’s concentration in
a particular geographical area, location is spread. Where the consumer or users are clustered then,
there is no need engaging middlemen, because the target market is known and the cost of
distribution will be small. Here a direct channel will be feasible.
iii. Company’s Objectives: Objectives are simply the goals of a company where the goals are
different from any of the stated factors, then that will guide the decision, whether to used any
indirect channel. Instances, a company will consider all the factors and then come out with decision
to use (Schewe, 2010).
iv. Firm’s Distribution Policy: A firm’s selection of certain channels of distribution in an
organization may be as a direct result of the firm’s distribution policy title towards intensive
selective or exclusively distribution. The established ways of reducing conflict. They are the
methods will depend largely on the desired objective of the firm.
2.2.6 PHYSICAL DISTRIBUTION
Physical Distribution is explained as an aspect of marketing management with minimum of
finished goods from manufacturers. Production areas to the purchases of those productions. It is
further explained as consisting of such operations as transportation, warehousing, material handling,
and inventory control order processing and protecting packaging. If one however examines the
operation carefully, it would be seen that they could be grouped into the categories e.g.
transportation warehousing and material handling (which involves the staff functions of the other
operation) (Adler, 2006).

2.2.7 THE NATURE OF PHYSICAL DISTRIBUTION

The nature of physical distribution shows that it occurs a lot of cost for example, if the
company is considering what mode of transportation to use in carrying goods to consumers, where
to store such goods carried i.e. where should a warehouse be location and in which staff should
handle the aspect of material handling. The company always considers the cost involved.
The following points are considered in Physical Distribution decision.
a) Sales and profit emphasis
b) Opportunity for cost saving
c) Utility resulting from Physical Distribution
d) Application of quantitative models
e) Emphasis on cost aspect (Michael, 2014).
2.3 SUMMARY OF THE REVIEW
According to Philip (2010) making channel decision is not easy for any organization because of
many factors to be considered before the actual decision arrived. Actually these decisions are among the
most complexity which among other things includes the following
 Poor communication between the manufacturers and the middlemen. Communication between two people is
to create understanding and give continues performance. If this is not systemic but broken, or not accurate in
presentation, it make channel decision difficult.
 Lack of research into channel distribution many companies assure that most of their channel in operation is
good enough to be in that business and therefore, they need to be investigated into before they are selected to
handle company’s distribution. The importance of the research channel of distribution is an organization is
necessary because it show the significance attitude of some dealers towards there supplier.
 Lack of direct control channel: The most difficult complexity is the inability of the manufacturers to
control the distributors. Since the distributors are purely independent bodies, they will not tolerate
interference in their activities and will not also corporate unless such cooperation will yield profit to the
organization.
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 CHAPTER THREE
RESEARCH METHODOLOGY

3.1 RESEARCH DESIGN

The research method used for this study is the survey design which studies both large and
small population by selection and studying samples chosen from the population to discover the
relative incidence, distribution and inter relation of sociological and psychological variable. The
research work also falls under the descriptive studies which can be used to solve the research
problem. The method helps a great deal in marketing research problem which is concerned with
describing market characteristics.

3.2 POPULATION OF THE STUDY

The population of the study comprises of the management and staff of Emzor
pharmaceutical industry while that of the loyal customers is estimated to be about 140. Here the
researcher is able to carryout the research work base on the number of people that participated.
3.3 SAMPLE/SAMPLING TECHNIQUES
Due to the difficulties involves in studying the entire population, the researcher makes use
of sample approach. A sample size of sixty staff is taken from the above management staff of
Emzor pharmaceutical industry of total population and for the customer thirty (30) all of them are
taken to be 90.
The method for the purpose of this research work is random sampling which each of the
universe has an equal chance of being chosen in the sample an the types adopted s the stratified
random
3.4 INSTRUMENTATION/MATERIALS
The questionnaires were use to carryout the research. The questionnaires were structured
with its content geared to achieve the objective of the study, the method used gives equal
opportunity for representing each variables and the simple percentage and chi-square used to
analyze and test hypothesis helps to reach fair conclusion, above all coefficient of contingency was
used to ascertain the validity and reliability of these research instrument
The methods of data collection in this research study were the primary and secondary
sources
Primary Source: This include the questionnaires and interview methods, that the researcher
use a methods to gather information
Secondary Sources: The secondary source of information used in this study was solely research
on newspaper, magazines, journals, textbook and information form the internet.
3.5 DATA COLLECTION/ANALYSIS
The one sixty questionnaires returned by different respondents were assembled for analysis.
The number of responses per question was ascertained and the percentage worked out based
on the returned questionnaires. The method used for the data analysis in this research was the
percentage and chi-square method.

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 CHAPTER FOUR
DATA ANALYSIS, INTERPRETATION AND DISCUSSION
4.1 INTRODUCTION
In this chapter, data collected from both the management group and customers group are
analyze classified, presented and interpreted to reflect their views on the subject matters. The
number of questionnaires returned was 60 out of 140 copies.
4.2 DATA ANALYSIS
The data from the opinion survey are presented in tablet 1-15
Table 4.2: Distribution by Sex of Respondents
Sex No of Respondents Percentage %
Male 35 58
Female 25 42
Total 60 100

Source: Field Survey, 2017

As shown in Table 4.1 above, shows that 60 respondents are selected from the management
of Nigeria bottling company 58% were males while 42% where female respondents
Table 4.2.2 Distribution by Marital Status of Respondents
Marital Status No of Respondents Percentage %
Single 32 53
Married 28 47
Divorced ---- ----
Total 60 100

Source: Field Survey, 2017

Table 4.1.1 Shows that 53.33% of the respondents are single, while the remaining 4767%
are married but none of them is said to be divorced.
Table 4.2.3 Distribution by Age of Respondents
Age No of Respondents Percentage %
18 – 25 26 43
26 – 35 13 22
36 – 45 11 18
46 – above 10 17
Total 60 100

Source: Field Survey, 2017

In table 4.1.3 above shows 43% of the respondents were aged between 18-25, 22 percent are
between 26-35years, 18 percent are between the age of 36-45 while the remaining 17 percent are
between 46 and above.

Table 4.2.4 Distribution by Educational Background of Respondents

Educational Number of Respondents Percentage%
O/Level` 8 13
NCE/ND 19 32
HND/Bsc 24 40
Higher Degree 2 3
Professional qualification 7 12
Total 60 12

Source: Field Survey, 2017

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 Table 4.1.4 above shows that 13percent of the respondents are holder of O/level certificate
32 percent of them are holders of NCE/ND) Certificate, 40 percent are holders of HND/Bsc
certificate and 3% are higher degree. While the remaining 12 percent are the professional
qualification holder
Table 4.2.5 Distribution by Position Held of Respondents
Position Held Number of Respondents Percentage %
Junior Staff 30 50
Middle Staff 20 33
Senior Staff 10 17
Total 60 100

Source: Field Survey, 2017

As shown in table 4.1.5 above clearly indicate that 50 percent of the respondents are junior
staff 33percent of them are middle line staff while the remaining 17 percent are senior staff.
Table 4.2.6 Working Experience (with company)
Years Number of Respondents Percentage %
1-4 10 17
5-10 20 33
11 – 20 18 30
21 – above 12 20
Total 60 100

Source: Field Survey, 2017

Table 4.1.6: above shows that 17 percent of the respondents have worked with the company
1 – 4 years, 33 percent of them have been with the company for 5 – 10 years, 30 percent have been
with the company also for 11 – 20 years while the remaining 20 percent have been with the
company for more than 21 years and above.
Question 4.2.7: What is the nature of the product?
Option No of Respondents Percentage
Perishable 60 100
Imperishable _ _
Bulky _ _
Non of the above 60 100

Source: Field Survey, 2017

Table of above clearly shows that the whole 60 respondents representing 100percent said
that the nature of their products is perishable
Question 4.2.8: What channel of distribution does your company use? Response
Option Number of Respondents Percentage %
Direct _ _
Indirect _ _
All of the above 60 100
Total 60 100

Source: Field Survey, 2017

Table 4.1.8 above shows that the company uses both the direct and indirect channel of
distribution in distributing their product. The 100 percent representing the whole 60 respondents
respond to all of the above

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Question 4.2.9: How do you motivate channel members for selling your products?
Option Number of Respondents Percentage %
Trade Offer 33 55
Cash discount _ _
Selling aids _ _
All of the above 27 45
Total 60 100
Source: Field Survey, 2017
Table 4.1.9 above shows that 55 percent of the respondents said is through trade offer, none
of the respondents neither choose cash discount nor aids, the remaining 45percent of them said all
of the above. 1.4 The company offers all of the above motivation tools to channel members.
Question 4.2.10: After distribution, does quality of your product measure up to standard?
Option Number of Respondents Percentage %
Yes 37 62
No 23 38
Total 60 100

Source: Field Survey, 2017

Table 4.1.10 above shows that 62 percent of the respondents are on the opinion that after
distribution, the company’s products measure up to standard while the remaining 38 percent said
No, that is after distribution the company’s product does not measure up to standard.
Question 4.2.11: Which of the distribution channels you consider profitable to Emzor?
Option Number of Respondents Percentage %
Direct _ _
Indirect _ _
All of the above 60 100
Total 60 100
Source: Field Survey, 2017
Table 4.1.11 above indicate that both direct and indirect is consider profitable to Emzor that
is all respondents are on the opinion that both is consider more profitable to the company.
Question 4.2.12 Do you have delivery service truck?
Option Number of Respondents Percentage %
Yes 60 100
No _ _
Total 60 100

Source: Field Survey, 2017

Table 4.1.12 above shows that the entire respondent said that the company has a delivery
service truck and none of them respond to no option.
Question 4.2.13: Do your company have a warehouse?
Option Number of Respondent Percentage %
Yes 60 100
No _ _
Total 60 100

Source: Field Survey, 2017

Table 4.1.13 above indicate that the company has a warehouse all the respondents are in
favour of YES option which represent 100 percent as shown in the above table.

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Question 4.2.14: Do you purchase all the company’s product.
Option Number of Respondents Percentage %
Yes 40 67
No 20 33
Total 60 100

Source: Field Survey, 2017

Table 4.2.14 above shows that 67 percent of the respondents purchase the company’s entire
product while the remaining 33 percent do not purchase all the company’s product.
Question 4.2.15: Does the company provide any kind of motivation
Option Number of Respondents Percentage %
Yes 60 100
No _ _
Total 60 100

Source: Field Survey, 2017

Table 4.2.15 above shows that the company provided motivation. As a result all the 60
respondents representing 100 percent are in favour of Yes option and non in favour of No option.
Question 4.2.16: Have you ever experience shortage of product in Emzor in your station.
Option Number of Respondent Percentage %
Yes 18 60
No 12 40
Total 30 100

Source: Field Survey, 2017

Table 4.2.16 above shows that 60pecent of the respondents said Yes and they have
experienced shortage of the company’s product while the remaining 40percent said No. they have
never experience shortage of product.
Question 4.2.17: Do you as a customer receive any incentive from the company for selling
their product?
Option Number of Respondents Percentage
Yes 30 100
No -- --
Total 30 100

Source: Field Survey, 2017

Table 4.2.17 above clearly shows that the total respondents representing 100percent have
received incentive from the company for selling their product.

Question 4.2.18: The distribution system of the company is effective

Option Number of Respondents Percentage %
Yes 18 60
No 12 40
Total 30 100

Source: Field Survey, 2017

Table 4.2.18 shows that 60percent of the respondents see the company’s distribution system
to be effective while the remaining 40percent of them sees it not to be effective.

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 Question 4.2.19: What Type Of Incentive Do You Received From The Company?
Option Number of Respondents Percentage %
Cash cut 6 20
Free Sampling 2 7
Coupon 12 40
Premium 10 33
Total 30 100

Source: Field Survey, 2017

Table 4.2.19 above shows that 20 percent of the respondents receive cash cut as incentive, 7
receive through free sample, another 40 receive coupons and the remaining 33 percent receive
premiums.
Question 4.2.20: How do you rate the incentive you receive from the company?
Option Number of Respondents Percentage
Good 8 27
Very Good 12 40
Fair 10 33
Poor -- --
Total 30 100

Source: Field Survey, 2017

Table 4.2.20 above indicate that 27 percent of the respondents sees the incentive they
receive to be good, 40% of them sees it to be very good, the remaining 33% see it to be fair and non
of the sees the incentive to be poor.
4.3 DATA INTERPRETATION
It has been observed that the main reason for testing hypothesis to determine whether there
is a relationship between variable under investigating. The chi – square method has been adopted to
test the hypothesis which stated as following.
HYPOTHESIS 1
Ho: Distribution does not help to inform the potential buyer as regarding the existent of a new
product
HI: Distribution helps to inform the potential buyer as regarding the existing of a new product.
Table 4.3.1
Option Management Expected Customer Expected value Total
Agree 37 36.67 18 18.33 55
Disagree 23 23.23 12 11.62 35
Total 60 60 30 30 90

Source: Field Survey, 2017

Total Row x Total Column

Grand Total = Expected Value

60 x 55 = 36.67
90

60 x 35 = 23.23
90
30 x 55 = 18.33
90

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30 x 35 = 11.62
90

Formula of Chi – square

X2 = (O.E)2 at 5% level of significant
E
Step 2 = Level of Significant
0.05

Where O = Observed frequency

E = Expected frequency

Degree of fraction (Df)

(Row – 1) (Column -)
(2- 1) (2- 1)
1x1
Df = 1

Where R = Rows
C = Columns
Coefficient off contingency

Formula √x2
N + x2
CALCULATION OF CHI- SQUARE

O E O-E (O – E)2 (O – E)2

E
OBSERVED EXPECTED
Frequency Frequency
37 36. 67 0.33 0.1089 0.0029
23 23.33 - 0.33 - 0.1089 0.0046
18 18.33 - 0.33 - 0.1089 0.005
12 11.67 0.33 0.1089 0.0093
X2 0.0227

Source: Researcher’s Computation, 2017

Level of Significance = X2 = 0.05 or 95% confidence level.

Table of value of Degree of freedom

1% = 5.596
Calculation Value = 0.0227

Decision Rule:
If the table of value is less than the calculated value rejects Ho and Hi considering the
decision rule Ho is rejected while the Hi is accepted.
Decision the calculated value for chi – square is (0.0227) is consider to be less than the table value
of 5.596 at 5% confidence level under 1 degree of freedom of

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HO: Distribution does not help to inform the potential buyer as regarding the existent of a new
product which is accepted.
HI: Distribution helps to inform the potential buyer as regarding the existent of a new product
which is rejected.
However, to further prove the reliability and validity of the decision coefficient contingency
is used.
C = √X2
X2 + Grand Total

C= √0.0227
90 + 0.0227

C= √0.0227
90.0227

C= √0.000252

C= 0.0158

C= 0.016
The coefficient of contingency calculated shows 0.0158 degree of relationship, which is
0.016% strong.
Hypothesis II
HO: Frequently distribution channel of making product does not lead to product loyalty and
higher sales.
HI: Frequently distribution channel of marketing product lead to loyalty and higher sales.
Table 4.3.2
Option Management Expected Customer Expected Total
value value
Agree 35 35.33 18 17.67 53
Disagree 25 24.67 12 12.33 37
Total 60 60 30 30 90

Source: Researcher’s Computation, 2017

Total row x total column
Grand total

60 x 53 = 35.33
90

60 x 37 = 24.67
90

30 x 53 = 17.67
90

30 x 37 = 12.33
90

CHI – SQUARE TABLE

13
 OBSERVED E O.E ( O-E)2 (O.E)2
Expected frequency E
35 35.33 - 0. 33 - 0.1089 0.0031
25 24.67 0.33 0.1089 0.0044
18 17.67 0.33 0.1089 0.0062
12 12.33 -0.33 - 0.1089 0.0088
X2 0.0225

Source: Researcher’s Computation, 2017

Level of significant x2 = 0.05
Table of value of degree of freedom 1% = 55%
Calculated value 0.0225
Decision Rule
Since the calculate value of the hypothesis is less than the table volume of degree of
freedom the null hypothesis should be accepted while the alternative hypothesis should be rejected.
However, to further prove the reliability and validity of the decision coefficient of
contingency (C ) is used.
C= √ x2
Grand total + x2

C= √ 0.0225
90 + 0.0225

C= √ 0.0225
90.0225
C= √ 0.000249

C= 0.0157

The result of the calculation indicates 0.0157 degree of relationship, which is 0.016%
Hypothesis III
HO: Distribution of a product does not constitute a reason for the consumers.
HI: Distribution of a product constitutes a reason for the consumer to buy such product.
Table 4.3.3
Option Management Expected Customer Expected Total
Value Value
Agree 40 38.67 18 19.33 58
Disagree 20 21.33 12 10.67 32
Total 60 60 30 10.67 90

Source: Researcher’s Computation, 2017

Total row x total column
Grand total

= 60 x 58 = 38.67
90

60 x 32 = 21. 33
90
14
 30 x 58 = 19.33
90

30 x 32 = 10.67
90

CHI – SQUARE TABLE

O E O.E (O.E)2 (O.E)2
Observed Expected
frequency frequency
40 38.67 1.33 1.7689 0.0457
20 21.33 - 1.33 - 1.7689 0.0829
18 19.33 1.33 - 1.7689 0.0915
12 10.67 1.33 1.7689 0.1658
X2 0.3859

Source: Researcher’s Computation, 2017

Level of significance X2 = 0.05

Table of value of degree of freedom 1% = 5.576
Calculated value = 0.3859
Decision Rule:
The alternative hypothesis should be rejected and the null hypothesis should be accepted
because the calculate value of the hypothesis is less than the table value of the degree of freedom.
In order to conform the reliability and validity of this result coefficient of contingency ( C)
is used.
C = √ X2
Grand total + X2
C = √ 0.3859
90.3859

C = √ 0.3859
90.3859
C = √ 0.00426
C = 0.065 or 0.15
The result of this calculation indicates 0.065 degree of relationship which is 0.15% strong.
4.4 DISCUSSION OF FINDINGS
In the study based on the data gathered and analyzed the following discussion become
apparent.
i. The nature of the product can lead to effective channel of distribution in an organization.
ii. The type of incentive the customer received also can lead to effective distribution channel.
iii. An organization have to work harder to meet with competitors or organization
iv. The general working atmosphere in an organization leads to effectiveness of channel of distribution.

15
 CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 SUMMARY
The aim of this research work is to identify and examine the importance of distribution
channel . The problem was considered against a background of discussion on the history of the
organization on the view of related literature. The main purpose of this discussion is to provide an
insight into the importance of distribution channel adopted by Nigeria bottling Plc Benin Plant.
Two wide approaches were employed in the study, the first approach include a series of
exploratory studies coupled with some structured questionnaires with a view of providing the
researcher with relevant information about the importance of distribution channel of the company in
an organization.
The second approach involves empirical investigation of the company and their customer.
In respect of these, a sample of 30 customers was asked to participate in a survey by
completing questionnaire. The evidence emerging from the exercise showed that the company
encountered a number of problem inadequate maintenance of vehicle of those problem the customer
whose needs and wants were not met, channels were designed to meet, felt unsatisfied and some are
even having the intention to change from Coca – cola to Seven Up, if such situation persists, it was
discovered that the motivational incentives provided by the company were, inadequate because
despite the presence of some incentives means to inspire and encouraged dealer for them to keep
them patronizing the company’s product.
5.2 CONCLUSION
The distribution of product from marketer to the ultimate consumers has been receiving
much attention in marketing oriented companies.
The marketer’s aim is not actually achieved until these productions are in right place at the
right time of existing and potential customer to buy. The product within minimum effort, this is
what made distribution to be one of the ‘marketing mix’.
In the distribution of the company’s product the channel is one of the most important factors
to consider for the product because this may lead the marketer’s to seek an alternative from the
view point. Marketers are left to decide which channel of distribution will be well suitable to make
his product available to the end users at the right place and time coupled with a reasonable cost.
5.3 RECOMMENDATIONS
Base on the findings of the research work the researcher has the following clearly stated
recommendation to make
1. Transportation:
Transportation is a very vital element in channel of distribution. it is the spinal cord of
distribution channel. In view of this fact, the transportation system of the company should be
reactivated especially the maintenance aspect of it. This will help to ensure the reliability of the
company’s transportation facilities as well as minimizing the rate which these facilities. Breakdown
has also caused a lot of ‘Bottle necks’. In the company’s distribution system.
2. Motivational Incentives
Motivation is an inspiring tool for propelling people to action or channeling behavior toward
goals.
In other words it is the way of encouraging workers to perform his duties in a desired
manner so that the organizational objective and goals can be achieve or melt. The method of
motivational incentive adopted by the Nigeria bottling will determine their performance. The target
sales of the company is a good step in the right direction as regard to motivational incentive both its
financial reward should be reviewed.
3. Promotional Activities
It is also recommend that the company should not relent in their promotion campaign
program most especially sales promotion and advertisement. This is due to the present pressure in
the industry brought about as a result of staff competition in the modern market environment.

16
 REFERENCES
Adler, L. (2006). Symbiotic Marketing, Harvard Business Review.

Bennard, H.E. (2012). Marketing Made Simple, London: Heinemam Printers.

Charles, S. (2010). Practical Market Research for Executive Decision, New Jersey: Richard Irwin.

Imafidon, D.O. (2011). Principles of Marketing, Benin City: Ribway Printers Ltd.

Joel, J.L. (2012). Modern Marketing, Sixth Edition U.S.A: McGraw Hill Inc.

Lazo, H. (2007). Modern Business Market, First Edition, New York: Practice Hall Inc.

Michael, J. B. (2014). Macmillan Dictionary of Marketing Advertising, London: Macmillan Press Limited.

Nwokoye, N.G. (2012). Modern Marketing for Nigeria, First Edition, London: Macmillan Press Limited.

Phillip, M. (2013). Marketing Management Second Edition, Irwin: Prentice Hall.

Schewe, C.D. (2010). Marketing concepts Application (First Edition), U.S.A: McGraw Hill Inc.

Stanton, W.J. (2011). Fundamental of Marketing Sixth Edition, U.S.A: McGraw Hill Inc.

17
 APPENDIX I

Department of Marketing,
School of Business Studies,
P.M.B 13,
Auchi.
Edo State.

Dear Respondents,
QUESTIONNAIRE
I am a final year student of the department of Marketing Undergoing a research work on topic;
importance Of Distribution Channel In marketing of a product in an Organization using Emzor as a
case study.
I thereby solicit for your co – operation, by answering the question attached to this letter. Every
information provided shall be strictly for academic purpose.
Thanks for your anticipated favored co- operation.

Yours faithfully,
Researcher

18
 APPENDIX II
MANAGEMENT QUESTIONNAIRE
In this research an attempt is made to examine the distribution channel of Emzor. As a respondent it would
be highly appreciated if you provide adequate information or tick the appropriate option on the following
academic purpose.
Section A
Personal Information on Distribution
1. Sex Distribution
(a) Male [ ]
(b) Female [ ]
2. Marital Status
(a) Married [ ]
(b) Divorced [ ]
3. Age Distribution
(a) 18 – 25years [ ]
(b) 26 – 35years [ ]
(c) 36 – 45years [ ]
(d) 46 and above [ ]
4. Educational background
(a) O/A level [ ]
(b) NCE/ND [ ]
(c) HND/BSC [ ]
(d) Higher degree [ ]
5. Position held
(a) Junior Staff [ ]
(b) Middle line Staff [ ]
(c) Senior Staff [ ]
6. Working experience with Nigeria Bottling
(a) 1 -4years [ ]
(b) 5 – 10years [ ]
(c) 11 – 20years [ ]
(d) 21years and above [ ]
7. What is the nature of your product?
(a) Perishable [ ]
(b) Imperishable [ ]
(c) None of above [ ]
8. What Channel of distribution does your Company use?
(a) Direct [ ]
(b) Indirect [ ]
(c) All of the above [ ]
9. How do you motivate Channel member for selling your product?
(a) Trade offer [ ]
(b) Cash discount [ ]
(c) Selling aids [ ]
(d) All of the above [ ]
10. After distribution does quality of your product measure up to standard?
(a) Yes [ ]
(b) No [ ]
11. Which of the distribution channel do you consider profitable to Emzor?
(a) Direct [ ]
(b) Indirect [ ]
(c) All of the above [ ]
19
12. Do you have delivering service truck?
(a) Yes [ ]
(b) No [ ]
13. Do you Company have warehouse
(a) Yes [ ]
(b) No [ ]
14. Do you purchase the entire company project?
(a) Yes [ ]
(b) No [ ]
15. Does the Company provide any kind of motivation?
(a) Yes [ ]
(b) No [ ]
16. Have you ever experience shortage of product in Emzor in your station.
(a) Yes [ ]
(b) No [ ]
17. Do you as a customer receive any incentive from the company for selling their product?
(a) Yes [ ]
(b) No [ ]
18. The distribution system of the company is effective
(a) Yes [ ]
(b) No [ ]
19 What Type Of Incentive Do You Received From The Company?
(a) Cash cut [ ]
(b) Free Sampling [ ]
(c) Coupon [ ]
(d) Premium [ ]
20. How do you rate the incentive you receive from the company?
(a) Good
(b) Very Good
(c) Fair
(d) Poor

20