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SALES VOLUME IN A MANUFACTURING INDUSTRY (A CASE STUDY OF PROMASIDOR NIGERIA LIMITED, LAGOS)

ABSTRACT

This research work examined the Effects of Promotional Tools on Sales Volume In a Manufacturing Industry with special reference to Promasidor Nigeria Limited, Lagos. The method used is survey approach which gives room for primary data-questionnaire while the sampling technique adopted is simple random sampling techniques in which all members of the population has equal probability and independent chance of being selected. One Hundred (100) questionnaires were administered as sample drawn from the entire staff of Promasidor Nigeria Ltd. All the questionnaires were retrieved giving 86% response. Three hypotheses were formulated and tested. The data extracted were presented on table using percentage and hypotheses were analyzed using chi-square analysis. Findings from the study shows that the choice of promotional tools affects sales volume of the organization. It was recommended that during festive period, organizations should take full advantage by developing an effective and efficient sales promotion campaign that can arouse the consumers awareness, thereby leading to greater purchase of their products. In conclusion, effective implementationof promotional tools lead to increase in sales volume and invariably higher profits and improved organizational performance.

CHAPTER ONE

INTRODUCTION

1.1      BACKGROUND OF THE STUDY

The business environment has affected the financial and commercial activities of business organization as a whole, which has resulted in decline level of sales and profitability. In view of this facts, many business organization are therefore involved in different type of measure such as sales promotion in order to increase their sales and also to remain in business since there is doubt that without adequate sales promotional tools, most of the business objective will not be reached.

The effect of promotional tools on sales volume cannot be over emphasized. Promotion ­which is among the 4p of marketing mix is essential in running of any organization. Due to the increase acceptance of sales promotion by firms as a very important element of the promotional mix and its expenditure also being on the rise, it has become very import to examine whether promotional tools is actually making any impact on the volume of sales. This paper specifically evaluates the effect of promotional tools on sales volume with special reference to Promasidor Nigeria Limited.

1.2      STATEMENT OF THE PROBLEM

Inspite of the tight definition of sales promotion as an essential means of creating awareness of the product existence and characteristics and also the positive, psychological associations that can enhance the buyer satisfaction which add to the real value of the company's offering, little attention is being given to it by many business sectors in the country and they rarely promote their sales to the fullest.

Many firms pay little attention to sales promotion since they feel they can sell their product with little or no promotional activities. Likewise, many firms could not afford the huge cost of the promotional programmes, would entail and despite the effects of sales promotion, there had been insufficient research and decision modeling devoted to it. In addition, there is an established negative perception of many firms as regards the cost of business promotion especially those whose benefits are not early and immediately reached.

Also, adequate records of sales and promotional cost are always neglected and some sales promotion programmes are introduced at the wrong time, which will therefore hinder the level of sales and profitability of the firm and thereby render sales promotions less important in the community and the country as a whole.

1.3      PURPOSE/OBJECTIVES OF STUDY

The purpose of this study is to examine the effects of promotional tools on sales volume in manufacturing industries with special reference to Promasidor Nigeria Limited, Lagos.

The objective of the study is:

1.     To examine the relationship between sales volume and promotion tools

2.     To investigate if consumers really benefit in sales promotion

3.     To examine if promotion tools influence consumer purchase behaviour

4.     To determine if advertising is the most effective promotion tool to increase sales volume

5.     To find out if Promotion tools have significant effect on sales volume

6.     To identify the implications of defective sales promotion in anorganization

7.     To examine the main factors that affect sales promotion?

1.4      RESEARCH QUESTION

This study tends to investigate and provide answers to the following questions.

1.     Is there any significant relationship between sales volume and promotion tools?

2.     Do consumers really benefit in sales promotion?

3.     Does promotion tools influence consumer purchase behaviour?

4.     Is advertising the most effective promotion tool to increase sales volume?

5.     Does Promotion tools have significant effect on sales volume?

6.     What are the implications of defective sales promotion in anorganization?

7.     What are the main factors that affect sales promotion?

1.5      STATEMENT OF HYPOTHESES

To provide answer to the research questions arising from this study, the following hypotheses are postulated.

Hypothesis One

H0:      There is no significant relationship between sales volume and promotion tools.

H1:      There is significant relationship between sales volume and promotion tools.

Hypothesis Two

H0:      Advertising is not the most effective promotion tool to increase sales volume.

H1:      Advertising is the most effective promotion tool to increase sales volume.

Hypothesis Three

H0:      Promotion tools has no effect on sales volume of an industry.

H1:      Promotion tools has effect on sales volume of an industry.

1.10   SIGNIFICANCE OF THE STUDY

It is a fact that sales promotion has a great impact in business organization. This study therefore intends to determine to a great extent the impact of sales promotion in business organization.

Because of the important role of sales promotion, this study will therefore make a useful improvement upon the performance of business and how their level of sales and profitability can be improved.

This project will be of immense value to future researcher who might intend to carry out a research on this particular topic. It will also help to highlight how individual who may set up their own business in future to carry out their business in an effective way.

1.7      SCOPE OF THE STUDY

This study is limited only to the effect of promotional tools on sales volume with special reference to Promasidor Nigeria Limited.

The research work will be limited to library/desk research and also face-face interviews will be conducted with some marketers so as to collect enough information to make the research a successful exercise.

1.8      LIMITATIONS OF THE STUDY

The limitation of this type of writing cannot be over­ emphasized, there are a number of limitations that could prevent smooth study activities or even discourage the completion of independent study. The basic expected limitations includes;

·        Uncooperative Attitude of the respondent

·        Non-Availability of essential records

·        Financial Constraints and short time pace

1.9      DEFINITION OF TERMS

The terms to be given operational definitions to are:

SALES PROMOTION: Sales promotion can be defined as a broad label that applies special kinds of sales accelerating activity not necessarily classed as advertising and direct selling.

BUSINESS: Business can simply be defined as the totality of all economic activities that are undertaken in the process of producing and distributing goods and services for the purpose of making profit.

ORGANIZATION: Organization is defined by Robine (1987) said an organization is a consciously coordinated social entity with a relatively identifiable boundary, that function on a relatively continuous basis to achieve a common goal or set of goals.

ADVERTISEMENT: Advertisement is any paid form of non-personnel presentation and production of ideas, goods or services by identified sponsor

PRICING: Price means the amount of money paid by the buyer to the seller of the product or service.

PUBLICITY: This is a non-personal communication or presentation of an ideal product, service or a cry that is not paid for by an identified sponsor.

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