THE IMPACT OF PHYSICAL DISTRIBUTION CHANNELS IN MARKETING AGRICULTURAL PRODUCTS

THE IMPACT OF PHYSICAL DISTRIBUTION CHANNELS IN
MARKETING AGRICULTURAL PRODUCTS

(A CASE STUDY OF PERISHABLE AGRICULTURAL PRODUCE IN BOKI LOCAL GOVERNMENT AREA OF CROSS RIVER STATE)

ABSTRACT

Physical distribution channels has created a created a great impact by bridging the gap between the producers and the final consumers. The inability of farmers to effectively reach out to distance markets and most final consumers with their agricultural products have resulted to waste of resources in Boki local government area. The main objective of the study is to find how best to market agricultural products in the area. Primary and secondary data were collected through the use of questionnaires and documented materials respectively. The population of the study was 227,400, while the sample size was 399. Chi-square test statistics was used to test the high hypotheses. Among the findings of the study; in effective and high cost of transportation, lack of storage facilities and basic infrastructure hindered the marketing of agricultural products in the area. The researcher thus recommended the provision of basic infrastructure like accessible road, storage facilities and improved transport system among others to assist in improving the marketing of agricultural products in the area.

CHAPTER ONE

1.1 INTRODUCTION

In many marketing science, the effective management distribution of product are essential to those that determine the extent of product availability at consumption point. Channel analyses is important in evaluating marketing system because it indicates how the various market participants are organize to accomplish the movement of products from the producer to the final consumer.

Distribution channel according to Philip, Kotler and Garry Armstrong (1999:362) is viewed as an interdependent organization involved in the process of making a product or service available for use or consumption by the consumer or business user.

Channels of distribution are management tools used in moving goods from the point of production to that of consumption. This function of getting goods into the hands of consumers is often referred to as „‟distribution„‟. Hence physical distribution involves planning, implementing and controlling the physical flow of materials, final goods and related information from point of origin to point of consumption to meet customer requirements and satisfactorily.

Distribution channels however, play major roles in the marketing of goods and in the business sector as a whole. Williams {1984: 38} stated the following as the usefulness or the importance of distribution channels to include: firstly, it gives place utility i.e. by moving goods from one place to another. Secondly, by bringing goods to the place of consumption when needed, it adds time utility.

Also by bringing the goods to the consumer in convenient shape, unit size and packaging, it adds convenient value. Thirdly, by making it possible for consumers to obtain goods at a price he is willing to pay and under condition which brings satisfaction and ownership. Efficient and effective distribution system is particularly essential in moving perishable products from the points of production to the point of consumption due to the nature of the products.

1.1 STATEMENT OF PROBLEM
Physical distribution has impacted greatly in ensuring that goods and services are made available when and where they are desired and in safe conditions. But due to the rise in technological development and global marketing, the process however, is not without problems as many companies and business people still lack adequate physical distribution facilities leading to the spoilage of these products before getting to their destination points.

Appropriate strategies for efficient and effective distribution of these products are required in distributing agricultural products in Boki local government area.

In Boki L.G.A lack of adequate and efficient distribution system has badly affected marketing of perishable products in the area as many of them perish on their way before getting to their consumption point.

1.2 OBJECTIVE OF THE STUDY
The following are objectives of the study:

i. To determine the problems that affects the selection of channels of distribution for agricultural products.

ii. To identify the basic components of physical distribution of agricultural marketing used in the area.

iii. To identify physical distribution strategies necessary or applicable for perishable agricultural products

iv. To make recommendation that could help to improve the efficient and effective physical distribution of agricultural products.

1.3 RESEARCH QUESTIONS
1. Do channels of distribution have any effect in the distribution of agricultural products in Boki L.G.A?
2. Do Government policies have influence on the distribution channel to be used for agricultural products in Boki L.G.A?
3. Does Boki have enough storage facilities that will promote agricultural products?
4. To what great impact has physical distribution channel in providing agricultural products when and where they are needed?
5. Does lack of infrastructures like access roads affects the distribution of agricultural products in Boki L.G.A
6. Does inadequate processing plant affect large scale production of perishable agricultural products in Boki L.G.A?

1.4 RESEARCH HYPOTHESIS
Ho: channels of distribution are not effective in the distribution of agricultural products in the area
HI: Channels of distribution are effective in the distribution of agricultural products in the area
HI: Inadequate processing plants discourage large scale production of perishable agricultural products.
HO: Inadequate processing plants encourage farmers into large scale production of perishable agricultural products.
3. HO: Lack of basic infrastructure like access roads has no significance effects on agricultural products distribution in Boki L.G.A
Hi: lack of basic infrastructure like access roads has significance effects on the distribution of agricultural products in Boki L.G.A
4 HO: Government policies do not have significance influence on agricultural products in the area.
HI: Government policies have significance influence on agricultural products distribution in the area.

1.6 SIGNIFICANCE OF THE STUDY
This research would be of great importance and will assist farmers in the management of physical distribution channel in the area. It will also help business firms and organization that are involved in physical distribution in Boki Local government area.

This study will also reveal the available distribution channels in Boki L.G.A and how to effectively utilize them. It will serve as reference materials to other researchers who may carryout similar work in the nearest future. Furthermore the result of this study will be of tremendous importance. It will also help consumers of perishable agricultural products to have these product when and where they are needed at the time they are needed .the study will equally assist channel member to know how best to perform their marketing activities to satisfy their clients, to local government, state and federal government ministries and parastatals seeking information as regards marketing of perishable agricultural products

1.5 Scope and limitation of study
This study is based on the perishable and none-perishable agricultural products in Boki local government. Information and data about „‟the impact of physical distribution channel in the marketing‟ is given only as related to these areas. Scarcity of resources in our depressed economy made it extremely difficult to conduct the research in a wide scope and area.
The financial commitment involved in this research work can also militate against wider coverage.

1.5 DEFINITION OF TERMS
DISTRIBUTION
Distribution is that which cover abroad range of activities aim at efficient movement of finished goods from the end of the production line to the consumers (Boon & Kurtz, 2000; 390)
DISTRIBUTION CHANNELS
Distribution channels consist of a set of interdependent organization involved in the process of making a product or consumption by the consumer or business user (Philip Kotler & Gary Armstrong 1999; 362).
Etzal, walker and Stanton (2007;380) defined marketing channel as the set of people and firms involved in the transfer of title of a product as the product mores from producer to ultimate consumer or business users.

Nwokoye (200; 105) define marketing channels as „‟the combination of institution through which a seller markets his products to the ultimate buyer‟‟ marketing channel are individuals or institutions that facilitates the flow the producer to the final user. Individuals and institution mentioned in this definition refer to middle men like wholesalers‟ retailers, distributors and agents.

RELIABILITY: The ability of an item to perform a required function under stated condition for a stated period of time (Baily and Farmer, 19: 44).

MARKETING CONCEPT: According to kinnear and Bemhardt (1990:12,), marketing concept is a decision making approach that focuses on customer needs and their societal consequences as it integrates all activities of the organization to satisfy these consumer needs in a way that is consistent with concern for broader societal consequence. The purpose is to achieve long-run objectives through the satisfaction of these customer needs, which must be balance against the needs of society as a whole.

MARKETING MIX: Mc McCarthy and Perrault, (1991: 33) defined marketing mix as those controllable variables which a firm can use to influence favorable response and stimulate profitable sales in the marking place. Nell Borden popularize the concept of marking mix

AGRICULTURE: According to Webster‟s Dictionary (1980) agriculture is a science or practice of farming.

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