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IMPACT OF RETAILING ON THE MARKETING OF CONSUMER GOODS

CHAPTER ONE

INTRODUCTION

1.0    BACKGROUND TO THE STUDY

Retailing is one of the most significant sectors of distribution. Retailing is a distributive activity that makes goods available to the ultimate consumers. It includes all the activities directly related to the sale of goods or services to the ultimate consumers. It involves selling to consumers who are acquiring goods for personal and non-business uses.

This view of retailing therefore connotes that any firm (manufacturing, wholesaling or retailing) that sells something to ultimate consumers for their non-business uses is making a retail sale. Retailing business ranges from the roadside fruit seller to the multimillion naira corporation. Retailing can be equally view as the activity of selling goods or services to the final consumer.

According to Levision (1998) retailers buy fast moving consumer goods that have varying life expectances. Product life expectancies affect consumer perceptions of what the total product offering should be. Durable goods last a long time and survive many uses examples are furniture, appliances and automobiles. Retailers of durable goods, especially those that perform continuous function such as automobiles and dishwashers, should be aware that consumer are not only buying "thing" but also satisfying a need over a long period of time. Retailing of non­durables goods are product that people consume in one or a few uses. Examples are food, liquour, tobacco and personal care items such as medicine and cosmetics; whereas durable goods are bought infrequently, nondurable goods are purchased regularly and often routinely.

Fast moving consumer goods are some product that consumer consistently purchases on a regular basis. Consumers buying cigarettes one a day, soft drink once a week, birth control pill per month and automobiles once every five years are examples of regular purchase behavior of a consumer. Frequency refers to the number of purchase a person moves out some time period. Consumers usually buy toothpaste frequently, foods, alcoholic, beverages, tobacco, house furnishing, equipment, automobiles gasoline, accessories and personal care item recreational equipment reading and educational materials and all bitter find money goods that consumers produce on a regular basis.

1.1    HISTORICAL BACKGROUND

Chi Limited is subsidiary of Tropical General Investment (TGI) Limited, a reputed group founded by European investors. TGI is a diversified group with Agro Allied, Manufacturing and Trading Operation in Nigeria, Republic of Benin and Ghana.

In the African Continent TGI have activities and interests in pharmaceuticals under the name and style of CHI Pharmaceutical Limited. Offshore oilfield service is looked after by Roomson Oilfield Services Limited. Deep sea Industrial Fish Trawling is carried out by ORC Fishing and Food Processing Limited. ORC is a major exporter of shrimps and other sea products to Europe. Comart (Nigeria) Limited is a manufacturer, importer and distributor of specialized chemicals and fragrances. Cotton ginning and Agro Chemical is carried out under West Africa Cotton Company Limited, Univision Nigeria Limited, exclusive agent in Nigeria for Microsoft navisions, deals in ERP and software solutions.

Chi Limited incorporated on 18th March, 1980 is the FCMG arm of TGI. Chi Limited carries out manufacturing and marketing of quality consumer product range includes Chivita - 100% premium fruit juices, Chi Exotic Nectar in the country, available in sensational juices and combination change the way juice is looked into. Chi Limited is the exclusive license of Capri-Sonne for Nigeria from Capri-sun AG, Zug, and Switzerland.

Chi Limited is also the manufacturer and marketers of the SuperbrandHollandia. Hollandia stand for quality, affordability, nutrition and tastepackaged together. Hollandia Milk Powder is known for its unmatched quality and affordability. Hollandia Evaporated milk, in an innovative 70g and 215g packs, has created a flutter in Nigeria and 70g pack was hailed as most innovative pack of 2005 worldwide in food products. Hollandia Yoghurt with real fruit juices has taken the nation by storm and has come to stay as a nutritiously delicious drink at affordable prices. Hollandiaflavouredmilk revolution in Nigeria. Hollandia UHT milk has taken milk revolution ahead with its unmatched quality. Chi Teddies Chocolate Cream has given a new dimension to chocolate consumption and is fast emerging hot favourite amongst children.

Chi snacks, a state of art bakery division produces ready-to-eat snacks by complete automated machine, untouched by human hands. The range includes Beefie, ChopOne, MrBeans and Chokobite, Muffin has been refined by Muff the Muff world-class quality muffins.

Chi Chicken and Chi Sausages are known for its market leadership and quality. Chi Limited has also gone into backward integration and has a captive juices concentration plant. Poultry breeding, farming and R&D un agriculture is carried out at its location at Ajanla Farms. Chi also own chain of retail shops exclusively selling Chi quality products at Factory Prices, under the name and style of Chi shops.

Chi Limited was the first to give nation the slogan -Be Nigerian, Buy Nigeria, Not only that, Chi Limited ignited a sense of price among fellow Nigerians that Nigerian products are amongst the best in the world and are exported to many countries. Chi Limited is an ISO 9001:2000 company and the house of Chi is an assurance of quality.

1.2    PURPOSE OF STUDY

The aims and objectives of this project is to examine and elicited how the impact of retailing is felt among the society especially on market of that moving consumer goods.

(i)      The study also intends to know how retailers market consumer product.

(ii)     To make the government contributes to the development and management of retailing business in Nigeria

(iii)    To find out about the promotion and expert policy of the nation supermarket as regards the marketing of consumer production.

1.3    RESEARH QUESTIONS

The research tends to provide answers to the following questions.

(i)      Does retailing has effect on the marketing of consumer product?

(ii)     Do the type of promotional tools determined customer patronage?

(iii)    Do prices have impact on customers' patronage?

(iv)    Does compete product mix brings about customer satisfaction?

(v)     Does access to retail outlets improve customers' traffic?

1.4    FORMULATION OF HYPOTHESES

The following hypotheses are formulated tentatively and will be tested during the course of the study

Ho:   That retailing has effect on the marketing of consumer product

          Ho:   That the type of promotional tools determines customers' patronage

          Ho:   That prices have impact on customers' patronage

          Ho:   That complete product mix brings about customers' satisfaction

Ho:   That access to retail outlets improve customers' traffic.

1.5    SCOPE OF STUDY

The scope of the nature of the topic for this research project tends to study the factors that influence how consumer makes their choice of products. It will relate to advertising and promotional strategy used by the manufacturers of the consumable product and some of the problems or difficulties that are encountered in course of marketing fast moving consumer product with a particular reference to Chi Retail Farmshop and Supermarket.

1.6    LIMITATION OF STUDY

The limitation of the study would be based on how the impact of retail business has been felt in our society especially on the marketing of fast moving consumer goods and responsiveness of the consumer will be noted. Again, the time constraints and the financial strength of the researcher will restrict the research exercise, which could have covered large areas.

Furthermore, the questionnaire administered in carrying out this research work is limited because the research is limited to Ajao Estate ApakunOshodi, Lagos State where the research is been carried out.

Apart from the above limitation, the findings and recommendation of the research will be based merely on the answer given in the questionnaire, observation and the oral interview.

1.7    OPERATIONAL DEFINITION OF TERMS

1.       Advertising:Is a form of communication through media about products, services or ideas paid for by an identifiable sponsor

2.       Marketing:is the management process reasonable for identifying, anticipating and satisfying consumer requirement profitability.

3.      Ultimate Use: they are otherwise known as the ultimate consumer these are the potential buyer of a particular product or services.

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