IMPACT OF DISTRIBUTION CHANNEL STRATEGIES

IN DISTRIBUTION OF MANUFACTURING
INDUSTRIES
(A Case Study of Seven-Up Bottling Company Plc, Ilorin)

By:-

WAHAB SULIAT OMOLARA

HND/22/BAM/FT/353

A PROJECT SUBMITTED TO THE DEPARTMENT OF

BUSINESS ADMINISTRATION, INSTITUTE OF FINANCE
AND MANAGEMENT STUDIES, KWARA STATE
POLYTECHNIC, ILORIN.

IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR

THE AWARD OF HIGHER NATIONAL DIPLOMA (HND) IN
BUSINESS ADMINISTRATION
 CERTIFICATION
This research work has been read and approved as meeting
the requirement of the Department of Business Administration,
Institute of Finance and Management Studies, Kwara State
Polytechnic, Ilorin in partial fulfilment for the award of National
Diploma in Business Administration.

………………………………… ………………………….
DR. T. A. POPOOLA DATE
(Project Supervisor)

…………………….…........ …………………………
MR. BAKER S. A. DATE
(Project Coordinator)

……………………….……... …………………………
MRS AMOO A. A. DATE
(Head of Department)

……………………….……... …………………………
(External Examiner) DATE

ii...
 DEDICATION
I dedicate this project to Almighty God, the most Beneficent,
and the most Merciful, who has been the source of my strength
throughout this program.
I also dedicate to my beloved mother Mrs. LAWAL, whose
words of encouragement and push for tenacity ring in my ears, I
know I will never have boast of doing this work or perhaps
continuing in this course, but today, I can proudly say I am glad I
did. God in his faithfulness will make you reap the fruit of your
labour (Amin).

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 ACKNOWLEDGEMENT
To wise creator God, the kings of the universe, father of all
glory and honor, I am most grateful for your loving, kindness and
mercies you have lavished generously to me through this year of
stress and labor.
I also give my profound gratitude to my knowledgeable project
supervisor (Dr. T. A. Popoola), for his kind gesture, motivational
words, words of encouragement, time spent, patiently and energy to
make sure I get the best from the work and consequently from the
course. I pray may you never know sorrow, may joy never seize
away from you and your family.
To my mother Mrs. LAWAL, you remain the best mother sin
the world. God enrich you abundantly. To my brother, sisters and
all kids in the family, I love you guys, thanks to everyone for their
support, you remain the best ever in my life.
I give thanks to entire lecturers of this great Department of
Business Administration, starting from my H.O.D may Almighty
God mercy be upon you and reward you all abundantly.
To all my friends and coursemates, Jesubiyi, Temilola
Precious, Kemisola, Abisola, really enjoy the year and time spent
with you guys. I love you all, you guys are the real MVP.

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 TABLE OF CONTENTS

CERTIFICATION........................................................................................................................ii
DEDICATION.............................................................................................................................iii
ACKNOWLEDGEMENT...........................................................................................................iv
CHAPTER ONE..........................................................................................................................1
1.0 INTRODUCTION............................................................................................................1
1.1 BACKGROUND TO THE STUDY...............................................................................1
1.2 STATEMENT OF PROBLEMS....................................................................................5
1.3 OBJECTIVES OF THE STUDY..................................................................................5
1.4 RESEARCH QUESTIONS............................................................................................6
1.5 STATEMENT OF HYPOTHESES...............................................................................6
1.6 SIGNIFICANCE OF THE STUDY...............................................................................6
1.7 SCOPE OF THE STUDY..............................................................................................7
1.8 LIMITATION OF THE STUDY...................................................................................7
1.9 DEFINITION OF TERMS.............................................................................................9
CHAPTER TWO..........................................................................................................................9
2.0 LITERATURE REVIEW.................................................................................................9
2.1 CONCEPTUAL FRAMEWORK..................................................................................10
2.2 THEORETICAL REVIEW...........................................................................................14
2.3 EMPIRICAL REVIEW..................................................................................................15
CHAPTER THREE...................................................................................................................20
3.0 METHODOLOGY.........................................................................................................20
3.1 RESEARCH DESIGN..................................................................................................20
3.2 SOURCES OF DATA...................................................................................................20
3.3 POPULATION OF THE STUDY................................................................................21
3.4 SAMPLE SIZE AND SAMPLING TECHNIQUES..................................................21
3.5 METHOD OF DATA COLLECTION.........................................................................22
3.6 INSTRUMENT OF DATA COLLECTION................................................................23

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3.7 METHOD OF DATA ANALYSIS................................................................................23
CHAPTER FOUR......................................................................................................................24
4.0 DATA PRESENTATION, ANALYSIS AND INTREPRETATION..........................24
4.1 INTRODUCTION..........................................................................................................24
4.2 PRESENTATION, ANALYSIS AND INTREPRETATION......................................24
CHAPTER FIVE........................................................................................................................31
5.0 SUMMARY, CONCLUSION AND RECOMMENDATIONS.................................31
5.1 SUMMARY.....................................................................................................................31
5.2 CONCLUSION...............................................................................................................32
5.3 RECOMMENDATIONS...............................................................................................33
REFERENCES..........................................................................................................................35

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 CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Distribution is the process of 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 at a profit. It is the
marketing function responsible for movement of products to the final users. It
could be said that production is not complete until the goods reach the final users
and for this to be accomplished, manufactured goods have to pass through
distribution channels. (Kotler and Amstrong 2001).
Regardless of how good product may be, it is of little use to customers if it is not
found at where he wants it and when he wants it. For simplicity, we will use the
term “Place” to refers to all the thing that go into providing time, place and
possession utilities that are needed to satisfy target customer just as we use product
to mean total product offered.
Place decision may be concerned with the location of marketing facilities
and the solution, use of marketing specification including transportation, storage
facilities, wholesalers and retails. There are many definitions of channels of
distribution some will be cited because each definition in its own way conveys a
bit about the concepts. (Borsodi, R. 1984).
Channels are methods or system that people use to get information or
communicate it to some specified set of people or individual. Distribution means
distributing something to some particular set of people. Channel of distribution is
an organized network of people or organization that performs all the marketing
functions and activities required in ensuring the movement of good from
manufacturers to consumers. (McCarthy, J. 1981).
1...
 Channels of distribution is also defined as the growth of intermediaries who
move good from producers to consumers channels are perceived by some group as
made up of intervening agents who facilitates sales. In our review, we shall define
channels of distribution as the path taken by the title ownership in moving goods
from producer to consumer. The Channels of distribution of consumer goods
therefore, in its most meaningful and simple form is the course taken in the
transfer of a commodity. This rate include both the manufacturer and the ultimate
consumer as well as anyone in between this kind of channels. Goods and services
cannot be marketed without the performance of market function. McCarthy, J.
(1981)
To understand this, one has to remember that marketing is the performance
of activities to facilitate exchange processes. Whenever we are talking of
facilitating exchange process, invariably we are thinking of channels of
distribution. It is importance to keep two things in mind.
1. Channels are coalition of marketing institutions (firms or agencies).
2. Collectively or independently performing marketing function
(Merchandising, promotion, physical distribution) in order to move
goods forms producer to target consumers.
This diagram suggested form of possible channels.

MANUFACTURER

WHOLESALER

RETAILER

CONSUMER
2...
 The first channel (manufacturer to consumer) is a direct channel of
distribution such channels are established when manufacturers sell through mail
order by catalogue or with their own field sales. E.g Aven Cosmetics. In another
channel, producers sell to retailers who in turn sell to consumer. This channel
represent the path taken by good handles by departmental stores.
The third channel is where wholesalers deal directly from the producers to
retailer who make the goods available to target consumer. That is the traditional
method where by goods have been distributed in many countries. It is still the
prevalent retailer such as clothing, specialist shop (hairstyle) drugs etc.
Other channel also provides different ways of reaching final consumer.
These channels suggest possible ways which has so many possible variations too.
The possible variation should not be seen as a competitive channel. Each should
be considered a separate possible channel to reach a particular target market.
Producers may adopt any one or more to these channels to have their goods reach
final consumer as large quantity as possible. But the channel chosen must deliver
goods and provide all the marketing functions.
Distribution channel strategies on its own, is a broad conception of how
resources are to be deployed to build a channel (or channels) linking the producer
to the consumer to insuring that the product and associated services are made
available to the target segment of the market. It concerned with efficient channel
arrangements that may be used to make goods and services available to
customers/users by deciding on which intermediaries and marketing channel
structures to be selected to move products in the most competitive and efficient
3...
manner to satisfy customer’s needs and wants. However, it is very important to
position the channel of distribution of lubricating products in strategic places
where users can get them and at the right time probably by using more effective,
efficient and strategic physical distribution pattern including well positioning of
field salesmen, institutional distribution system of products etc.
Distribution is the path through which goods and services traverse as they
go from producer to ultimate consumer. Also, marketing channels or marketing
intermediaries represent organized network of agencies and institutions which in
combination perform all the activities required to link producers with users and
users with producers in order to accomplish the marketing task. By delivering
products and their ownership titles to consumers at the right time, marketing
channels therefore, perform a special kind of service to society by generating time,
place and ownership utilities.
A sound physical distribution policies are therefore, important as a
guideline for companies effective and efficient performance in order to realize and
achieve the desired short and long run goals and objectives.
Many business organizations have come short of achieving their desired
goals and objectives even after producing high quality products. These
shortcomings have been attributed to improper, ineffective and inefficient channel
strategies as it relates to physical distribution of goods. The purpose of distribution
is to make goods to be physically available to the ultimate consumer at reasonable
prices. It is therefore; very imperative that the products are distributed in the most
efficient manner to reach the ultimate consumer whose patronage ensures the
survival of the organization. By so doing, the organization will enjoy consistent
high sales turnover and subsequently high profit delivery.

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1.2 STATEMENT OF PROBLEMS
An efficient physical distribution system makes it possible for a particular
geographical area to specialize in producing products for which it has the
appropriate natural resources, ultimate or to the advantage.
However, physical distribution policies of most product- oriented
companies in Nigeria have left - much to be desired in satisfying-the consumers
wants and needs.
This project work will endeavour to find out how distribution strategy
important to Seven-up Bottling Company organization in Ilorin, and proffer
solutions for improvement.
1.3 OBJECTIVES OF THE STUDY
The general objective of the study is to examine the distributions channel of
consumer goods and to be able to differentiate between the goods channels in
different form.
In order to achieve the company goals, the following objectives are:
1. To examine whether the physical distribution policies of the company are
being implemented along the line of set objectives.
2. To ascertain the extent the various channel strategies have helped to enhance
the company’s physical distribution problems.
3. To determine to what extent the sales department especially, has gone in
coping with short of delivery trucks, vehicles etc.
4. To proffer or recommend articulated solutions to the bottlenecks being
experienced by the Seven up Bottling Company Plc, in the physical
distribution of her productions within Ilorin.

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1.4 RESEARCH QUESTIONS
i. Does the physical distribution policies of the company one being
implemented with the set objectives.
ii. What are the various channel strategies that helped to enhance the
company’s physical distribution problems?
iii. Does the sales department of the company cope with short of delivery
trucks vehicles?
iv. What are possible solutions to the bottle necks being experienced by the
Seven-up bottling company?
1.5 STATEMENT OF HYPOTHESES
Ho: The physical distribution policies of the Seven-up Bottling Company have not
encouraged consumer loyalty of the company’s product.
Hi: The physical distribution policies of the Seven-up Bottling Company have
encouraged consumer loyalty of the company’s product.
Ho: The sales department programmes to satisfy both existing and prospective
customers are not adequate.
Hi: The sales department programmes to satisfy both existing and prospective
customers are adequate.
Ho: The chosen channels of physical distribution have not affected the consumer
patronage of the company’s products.
Hi: The chosen channels of physical distribution have affected the consumer
patronage of the company’s products.
1.6 SIGNIFICANCE OF THE STUDY
This research work is very significant because of it contributes to the field
of knowledge, in finding ways of improving the physical distribution policies of
Seven-up Bottling company in Ilorin.
6...
 Additionally, the research work would appraise the significant role of
distribution channel strategies policies of the Seven-up Bottling Company Plc, in
Ilorin as to know whether it has been adequate to the company’s most target
audience.
The findings and recommendations of this research work if adopted by
Seven-up Bottling Company Plc, in her physical distribution policies will reduce
some costs and enhance her distribution activities above her competition.
Management of soft drinks companies and the Seven-up Bottling Company
plc, in particular can adopt these findings as a guide in formulating their physical
distribution polices for their companies.
Academically, further research could be carried out to widen the intellectual
horizon of people, and also, improve the physical distribution policies of the
Seven-up Bottling Company Plc, and other Soft Drink Bottling Companies in
Ilorin and beyond.
1.7 SCOPE OF THE STUDY
The scope of this study is only limited to the Ilorin Metropolis as being
covered by Seven-up Bottling Company. Perhaps the most obvious point to note is
the fact that this study is selective. Therefore, it takes a global view of distribution
channels strategies for consumer goods, since the goods produced go through
some process of distribution and enhances distribution channel. It is pertinent to
point out therefore, that this resulted only to the examination of distribution
channels of consumers goods.
1.8 LIMITATION OF THE STUDY
In any human endeavour, there are always some constraints and this
research work is not an exception.

7...
a. It was the intention of the researcher to cover other products but for the limited
time given for the study.
b. Closely related is the problems of inadequate fund to finance the research which
limited the scope of research to only the Seven-up Bottling Company Plc in Ilorin.
c. Limited published data on the topic was equally a constraint. In fact, much has
not been written in this field in which case, the researcher wrote using other
published material.
d. Accessibility to some key officers for interview was nearly impossible as the
secretary deliberately refused the researcher entry. Others claimed they were not
authorized to expose official secrets.

8...
1.9 DEFINITION OF TERMS
Distribution: This is the process of planning, implementing and controlling the
physical flow of materials, final goods and related information from point of origin
to points of consumption to meet customer requirements at a profit.
Distribution Strategy: This is the efficient channel arrangements that may be
used to make goods and services available to consumers by deciding on which
intermediaries and marketing channel structures to be selected to move products in
the most competitive and efficient manner to satisfy customer’s needs and wants.
Distribution Channel: This is a set of firms and individuals that take titles in
transferring titles to a particular goods as it moves from the point of production to
the points of consumption
Distribution Centre: This is a large, highly automated warehouse designed to
receive goods from various plants and suppliers take orders.
Product: This is anything of value offered to a market for attention, acquisition
and consumption that may satisfy needs.
Customer: This is the bonfide buyer of a product that makes repeat purchase from
time to time.
Consumer: this is individuals who purchase for personal or domestic
consumption.

CHAPTER TWO
2.0 LITERATURE REVIEW
INTRODUCTION
This chapter reviews related empirical literature on the subject matter. The
relevant literature will be reviewed under the following outline: the conceptual and
9...
theoretical framework of the study. The presentation on this literature now
follows:
2.1 CONCEPTUAL FRAMEWORK
2.2.1 THE CONCEPT OF DISTRIBUTION CHANNEL STRATEGY
Distribution Strategy refers to the flow of procedures from the products
from the production points to the consumption points. According to the American
Council of Distribution Strategy Management.
“Distribution Strategy is a term employed in manufacturing and commerce
to desirable the broad range of activities concerned with efficient movement of
finished products from the end of the production line to the beginning of the
production line.
These activities include foresight, transportation, warehousing, material
handling, material handling, protective packaging, inventory control, plant and
warehouse site section, order processing market forecasting and customer services.
Another author puts it that; “distribution strategy is an integrated set of
activities that deal with managing the movement of products within firms and
through marketing channels”.
Artman and Clacy (2001) viewed distribution strategy as a small business
to expand their cost cutting efforts beyond their historical focus on production to
encompass physical distribution activities. This they made an article entitled
marketing myopia in the Harvard business review, in which he addressed the
fundamental question, why do firms and indeed whole industries grow to position
of great power influence and their decline.
Production is not the ultimate means of satisfying consumer needs or wants.
Even in the production era where consumers were induced to buy goods at a firm
or company determination. Yet, distribution was very important as at then. This is
10...
supported with the fact that finished goods produced in question have to move
from processing point to the point of consumption. (Malhotra, 1996).
For a firm to achieve its objective, finished goods have to move to where
they are more needed, this depends on strategic policies of an organization may
adopt to suit plans, that, is rely there are always variation on distributing pattern
this attributed from the concept of authorities in defining the term distribution as:-
Distribution is the movement of goods and services from the point of
production and the finished product to the final or ultimate users. This process
occurs in two distinct ways: firstly, the raw materials from its source to the factory
where it will be processed into finished goods and secondly these finished goods
to the users. To provide later with convenient means of obtaining the product
he/she wishes to buy. This essentially, is the function marketing distributing
channels the path that goods and title to them follow from producer to consumer.
In moving goods to convenient location channel provide time, place and
ownership utility.
Time – Production available when consumers want to buy. Production and
distributing obstacle are greatly reduced seriously under a system of job order
production. In this system consumer places an order and return several week or
month later to claim the finished product and a few marketing risks. However,
except for major purchase of installation with unique specification and large
government contract, few products are purchased on a job order basis.
Place utility: Product available where consumers want to buy. Products in the
manufacture custody are of no use to the consumer, since few consumers are
willing to seek out the manufacturer, thousands retail stores have been established
to provide goods in location convenient to consumers. This store along with

11...
vending machines mail order catalogues, and telephone sales, are a means of
convenient supply of product to the consumer.
Ownership utility: Exchanging title of product. Marketing channels also provides a
means for title to be transferred from manufacture to buyer. The purchaser or
buyer can obtain physical possession of and title of the product at the store. The
authority BOONE AND KURTZ has propounded the later.
However, some authorities also define distribution in number of ways.
Oliver said distribution in marketing must be noticeable to enable exchanges in the
physical movement of product from producer to consumer or in locating service
points. While Good ridge define it as the business of transferring goods from
producer and manufacturer to consumer. Distribution is said to be the focal point
of all business activity without distribution all other operations (production finance
and the like) become meaningless.
Also Moden defined distribution as the link between production or supply
and consumption. Another authority Marcus, refer distribution as the network of
channel, and institutions that facilitate the marketing exchange that consist of three
basic channel with number of modifications manufacturer (processor)Consumer,
processor – retailer – consumer and manufacturer- wholesaler – retailer –
consumer.
Nigeria authority Nwokoye also view distribution as a task to make goods
physically available to buyer. Nevertheless Philip define distribution as the process
of physical handling of goods, passage of ownership and most important from the
stand point to marketing strategy to the buying and selling negotiation between
middlemen, producers and consumers.
2.2.2 CHANNEL OF DISTRIBUTION

12...
 Products do not simply fall into the hands of those who want or need them.
In fact, there can be no buying and selling if there is no system of distribution
because the function of distribution is to move goods from producers to the
consumers.
2.2.3 CLASSIFICATION OF DISTRIBUTION CHANNEL
Company decisions regarding the type of distribution channel are
considered in two structural systems: vertical and horizontal.
In the vertical structure there are a number of dependencies between
companies. Several decisions about the quantities of different levels of a flow
streams are made here. The horizontal structure determines the number and type of
intermediaries on specific levels.
In distribution channel a number of intermediaries is important who
participate in the transfer of goods and property rights to it from the producer to
the final client.
Each of these participants becomes another level in the distribution channel and
their number determines the length of the channel. The vertical structure of
distribution channels and its length is defined for example by following
determinants:
 Customer;
 Features of a product;
 The financial capacity of an enterprise that is making the decision;
 Organizational and legal conditions for distribution.
An enterprise, which is cooperating of intermediaries, faces a choice of one
of the three systems with different levels of surveillance powers to the channel by
the company:
 Corporate,
13...
 Contract,
 Conventional.
A corporate system is being used by organizational units during phases of
creation and development. In this case the producer is an owner of the channel
system, which relies only on him. It is a vertically-oriented system in which the
producer is obliged to provide financial and human capital.
2.2 THEORETICAL REVIEW
This study is based on certain relevant theories that form the backbone of
ideas which provided the super structure that culminated in the development of
research questions.
THEORY OF DISTRIBUTION CHANNEL
Distribution is traditionally the fourth element of the Marketing Mix, also
called place, preceding product, price and promotion. Distribution channels are the
intermediary organisations or channels that a product passes through before it is
consumed or used. Typically, these organisations are marketing or selling
specialists and use economies of scale to bring success. In a context of industrial
or consumer products, manufacturers differ on how they distribute their products
to the consumer. Some of them distribute intensively (using a lot of
intermediaries) or exclusively (directly to the consumer) (Bucklin, 1966).
The structure of channels requires a set of strategic decisions (lyanda,
1990): The first decision determines the appropriate intermediary type, e.g.
wholesaler, retailer, franchise, broker, direct sales force.
The second is distribution intensity that is, how many intermediaries to
include and number of levels of a channel structure.
The second strategic decision in a channel, distribution intensity, is a key
element of the channel strategy (lyanda,, 1990, Fulmer, Gerhart, and Scott, 2003),
14...
and often dictate all the channel structure influencing the type of intermediary, the
coverage of the market, and the kind of distribution (direct or indirect).
DEPOT THEORY
The flow in the distribution channel has been explained using parallel
model, model postponement and speculation under Depot Theory. How fast do
flows move to overcome separations and match a seller’s small segment of supply
with a buyer’s small segment of demand? According to Aspin wall’s (1958) Depot
Theory, goods move toward consumption at a rate established by the final
consumer’s need for replacement. As detailed in Aspin wall’s (1958) Parallel
Systems Theory, replacement rate is inversely related to gross margin, services
required, search time and consumption time. Thus, knowing replacement rate
provides knowledge of the other characteristics determining rate of flow.
SYSTEM THEORY
Physical distribution can be viewed as a system of components linked
together for the efficient movement of products. Using a system approach to
describe physical distribution, the components include; customer service,
transportation, warehousing, order processing, inventory control, protective
packaging and materials handling. These components are interrelated, hence:
decisions made in one area affect the relative efficiency of others. For example, a
small business that provides customized personal computers may transport
finished products by air rather than by truck, as faster delivery times may allow
lower inventory costs, which would more than offset the higher cost of air
transport. Viewing physical distribution from a system’s perspective can be the
key to providing a defined level of customer service at the lowest possible cost.
2.3 EMPIRICAL REVIEW
Channel Differentiation and Performance
15...
 Filipe, Chris and Arnaldo (2003) have examined exploratory evidence of
channel performance in single versus multiple channel channel strategies. Their
study contributed to theory by clarifying the relationship between the number of
channels and channel performance, along with the relationship between channel
strategy and product type and company size. The study sought to answer the
question: what is the impact of the number of channels on the performance of the
entire channel system? The financial services industry was selected for the study,
since multiple channels are common in the distribution of these products. Cross
sectional research design was adopted and the study collected information on the
channel channel strategies used by 62 organisations using questionnaires (Filipe et
al., 2003).
The study revealed that the very appealing benefits that can be generated by
a multiple channel strategy, namely sales growth and a more balanced source of
revenues, have to be balanced against some of its drawbacks, which may include
lower profitability and a less reliable service (Filipe et al., 2003). The authors
recommended that more attention should be directed to investigate the drivers of
multi-channel channel strategies which this study aims to achieve. While the study
by Filipe et al. (2003) was based on banking sector, the study that informed this
paper focused on manufacturing industry in Kenya that deals in both products and
services.
Niels, Pier and Jon (1999) have investigated the distribution channel
channel strategies in Danish retail banking. Their study aimed to answer the
question: what distribution channel channel strategies does this development offer
the retail banks and which of them do they actually pursue? The descriptive survey
research was utilized. Niels et al. (1999) collected data from the 70 largest banks
in Denmark as registered by the Danish Supervisory Authority of Financial Affairs
16...
(DSAFA, 1997). The distribution channel channel strategies and other marketing
mix elements were measured by the items in a five point Likert-scale was used (1
= strongly agree to 5 = strongly disagree). The findings revealed that most banks
pursue the multiple channel strategy (Niels et al., 1999). Retail banks had the
electronic channels and especially the Internet are new distribution channels that
offer less waiting time and a higher spatial convenience than traditional branch
banking and they are therefore attractive to a large and quickly growing segment
of bank customers (Niels et al., 1999).
Niels et al. (1999) recommended that the relevant customer segments
should be identified and that attempts should be made to predict the development
of their sizes. They also recommended that competitor actions be described in
order to estimate the intensity of rivalry for different customer segments. This
paper examines the impact of channel differentiation strategy on organizational
performance in the manufacturing industry. Only one firm, Sameer Africa was
used in the study unlike 70 largest banks in Denmark used by Niels, Pier and Jon
(1999).
Amara (2012) has studied the effect of marketing distribution channel
strategies on a firm’s performance among commercial banks in Kenya. The study
objectives were: to establish the distribution channel strategies adopted by
commercial banks in Kenya and to determine the relationship between distribution
channel strategies adopted and the performance of the bank. The study adopted a
descriptive survey research design. The population of the study was all the forty-
three commercial banks operating in Kenya. The study used both primary and
secondary data to be collected through questionnaires. The study found that the
branch network, electronic banking and multiple distributions were used by the

17...
banks (Amara, 2012). The marketing distribution channel strategies results to
increased sales, market share and profits.
It, therefore, recommended that the commercial banks should adopt those
marketing distribution channel strategies that ensure the performance of the bank
is improved and do away with those which adds costs so that the banks can
compete effectively with the others (Amara, 2012). Like the previous, the study
was carried in banking sectors while the current one used manufacturing sectors.
For the purpose of reliability and acceptability of the findings, the study targeted
one firm within the manufacturing industry instead of sampling some firms within
Kenya Association of Manufacturers. In addition, the study used interview with
top management to supplement the questionnaire for in depth information on how
the firm utilized channel differentiation in order to gain competitive advantage.
Kalubanga (2012) sought to examine how multi-channel distribution
operations affect a firm’s performance. The research question was, “what is the
effect of multi-channel distribution on a firm performance. A cross-sectional study
approach was used together with the quantitative and qualitative research designs.
A sample was determined scientifically from a study population of senior and
junior staff engaged in sales and distribution, and distribution agents, wholesale
and retail using the Krejcie and Morgan scientific table for determining sample
size. Data was collected using a self-administered questionnaire and analysed
using statistical measures obtained using SPSS (Statistical Package for Social
Scientists). The study findings showed that efficiency in distribution nodes support
overall firm’s performance; multi-channel distribution management practices have
an effect on the performance of a firm (Kalubanga, 2012).
While the Kalubanga (2012) focussed on multi-channel distribution
operation, the study that informed this paper examined differentiation channel
18...
used in distribution by the Sameer Africa (K) Limited and the study adopted
correlational research design. This encompassed the relationship between multi-
channel product distribution and financial performance of manufacturing entities
and how multi-channel product distribution companies should organize themselves
to attract and retain more customers.
Gabrielsson (1999) has investigated the sales channel channel strategies for
international expansion as a means of compensating for constantly decreasing unit
prices and margins in the personal computer (PC) industry operation in the
European Union market. The author describes and analyses the development from
single (direct or indirect) to multiple (dual or hybrid) sales channel strategy for
international expansion. The methodology used was a qualitative research strategy.
The study conducted a longitudinal multiple case study consisting of 20 top
management interviews related to four cases. The results revealed that through
partnerships with strong and leading partners, multiple channels provide a way for
these firms to expand rapidly to global markets while maintaining control over
their marketing (Gabrielsson, 1999). The study recommended that multinational
companies should adopt hybrid sales channel. The study by Gabrielsson (1999)
used a case study research design in the European Union Market while the study
that informed this paper adopted correlational research design as the study sought
to find the relationship between channel differentiation strategy and performance
of Sameer Africa (K) Limited.

19...
 CHAPTER THREE
3.0 METHODOLOGY
Research methodology is simple the process of arriving at dependable
solution to problem through the planned and systematic collection, analysis and
interpretation. The chapter of the study deals with the method used in collecting
data for the study. It describes in details research methods used instrument for
collecting data. Also, it reveals how sample size was chosen from the population.
3.1 RESEARCH DESIGN
Research design is the master plan. It is framework which specifies the type
of information to be collection, the source of data and data collection procedure,
research objectives and type of research.
These are various methods used in research design:
i. Descriptive research.
ii. Experiment research.
iii. Survey research.
iv. Export facto research.
For the study for this study is survey because it is a social science research
method
3.2 SOURCES OF DATA
An interview as a method of data collection involves the asking of a set of
question by the researcher. And is a year to face method of data collection which
involves some conservation or dialogue between these two (2) parties will centre
basically around could not question to answer in conjunction with the subject
matter. During this process, 30 questionnaires were distributed in order to arrive
and get validity response from the company as well as their customers, which

20...
comprises of production department, managers, sales manager, the customer and
the public that consume the product time to time.
Questionnaire
A questionnaire is a body of information seeking question around inform of
structural interview on a questionnaire delivered by hand due to distance between
the researcher and the sample size, the mall questionnaire on a questionnaire
delivered by hand was used to get more fact from some selected respondents from
the marketing department, purchasing department of the company. Through this
source of data collection and information 30 questionnaires were sent out and 20
of them returned in order to acquire some information about the 7up Bottling
Company.
Observation
Observation has to with watching the question operating in a particular area
as they are being carried out in respect of the subject matter or under study. The
researcher were able together some fact from external people who came to visit
Nigeria Bottling Company for business purpose.
3.3 POPULATION OF THE STUDY
The researcher population companies for all customers and potential
customers of 7up Bottling Company Ilorin, over ten million we have people live in
Ilorin, out of that ten million we have seven million people drinking coca-cola. A
total sum of 100 people was randomly selected in larges due to large number of
population. Therefore a simple size of 30 respondents were questioned and used
for the analysis.
3.4 SAMPLE SIZE AND SAMPLING TECHNIQUES
A sample size is precisely part of all population and procedure for drawing
samples from a population, sampling and able the researcher to estimate the
21...
population characteristics, since there are similarities among the element that
enable the study to take place. Few of these elements will give the researcher
sufficient knowledge of what is obtained in the entire population.
Sampling is cheaper and enables a through work; it also helps to obtained
result, so this study will make use of profitability sampling method. This is where
sampling items or object is choosing randomly and where every items or object in
the population is given equal and independent chance of being included in the
sampling. A sampling size of 240 questionnaire were choosing by the researcher
when be the basis of analysis of our statistical data in chapter in chapter four.
In this survey, questionnaire were administered to respondents out of which
and were not required, the respondents cut across both sex, the different age
groups that make up the labour force and different educational qualification
stratified random simply was used in serving emergency of a more representative
sample. The distribution was done randomly between departments at different
level of operation. The questionnaires were administered and out of this two
hundred and forty were completed and returned representing 100% response rate.
Participants: Those who will participate in this study must meet these criteria:
Inclusion criteria: Both young and adults with the age range of 18-30 years and
50 years about that are currently workers of SBC Ilorin, Kwara State, will be
allowed to participate in this study. Both female and male staffs have equal rights
to participate in the study. For this study, the simple random sampling was used,
since it is very appropriate to the research. It gives each member equal chance of
being selected or chosen.
3.5 METHOD OF DATA COLLECTION
In gathering data for this study, questionnaire would be used in collection
of data from respondents.
22...
 Questionnaire is a set of designed and arranged question is any readable or
accessible to be distributed to the respondents the questionnaire used certain close
ended question in which the respondents choose from various options. Also,
questionnaire consist structural question formulated to enhance good response
from respondents will later be analyzed.
3.6 INSTRUMENT OF DATA COLLECTION
Research instrument is a device for collecting data, method that can be used
for collecting data include;
i. Questionnaire
ii. Personal interview
iii. Observation
For this research work, questionnaire will be use for data collection which is
going to be 30 on attaining organization objective through motivation, case study
of 7up Bottling Company, Ilorin.
3.7 METHOD OF DATA ANALYSIS
The researcher presented and analysed the data for the sake of easy
understanding so as to generate findings or solution to the impending problems.
The data would be analysed by the researcher in order to create meaning
pictures for the presentation and analysis of data, but there are many ways by
which data can be presented and analysed.

23...
 CHAPTER FOUR
4.0 DATA PRESENTATION, ANALYSIS AND INTREPRETATION
4.1 INTRODUCTION
To analyse the data collected, this chapter is divided into two sections,
questionnaire administration and test of hypotheses. These sections are hereby
presented in a chronological sequence In line with the research objectives,
questions and hypotheses.
4.2 PRESENTATION, ANALYSIS AND INTREPRETATION
It was viewed that age differences of the respondents will be considered in
the distribution of the questionnaire. This was based on the assumption that there
is relationship between age and interest in the level of appreciation. The Table
below summarizes the distribution or respondents by age and sex.
TABLE 4.1 SEX AND AGE DISTRIBUTION OF RESPONDENTS
Age Range in Years FEMALE MALE TOTAL
18-30 yrs 10 12.5 20 12 30 2.25
31-40 yrs 35 43.75 80 48.9 115 47
41-50 yrs 30 37.5 50 30 80 32.65
51 and above 80 100 165 100 245 100
Source: Questionnaire Survey, (2021)
In table 4.1 above, a summary of the distribution of questionnaires by age
consideration was tabulated. The table indicate that 80 questionnaire were
administered on men. Further, the analysis of sex and age distribution revealed
that 80 out of 245 subjects, representing 32% were female, while the remaining
165 (68%) represented the male.
TABLE 4.2 TOTAL NUMBERS OF RESPONDENTS
Respondents SBC No of copies No of Usable Response Rate (%)
24...
 plc Public Administered Copies Retrieved
MGT Staff 85 80 34.70
Distributors 80 80 32.65
Consumers 80 80 32.65
Total 245 240 100
Source: Questionnaire Survey, (2021)
Table 4.2 above, shows the total number of respondents of this research
study. Out of a total of 240 subjects, 80 were the SBC Plc MGT & Staff, while 80
each were the SBC Plc Distributors and consumer respectively.
Furthermore, out of the. 245 questionnaires distributed to the three
segments of respondents, 240 were retrieved and found usable. This means 98% of
the questionnaires distributed were usable.
TABLE 4.3: KNOWLEDGE OF THE DISTRIBUTION CHANNEL
STRATEGIES OF SBC PLC
Response Respondents Percentage

Manag. Staff/ Distribution TOTAL

consumers
NO % NO % NO %
YES 120 100 120 100 240 100
NO - - - - - -
TOTAL 120 100 120 100 240 100
Source: Questionnaire Survey, (2021)
Table 4.3 above, indicates that both Internal and external publics of SBC Plc
distribution channel strategies of SBC Plc.

25...
TABLE 4.4: PERCEPTION (FEELING/IMPRESSION) ABOUT SBC PLC
DISTRIBUTION CHANNEL STRATEGIES
Response Respondents Percentage

Internal Publics/ External public TOTAL

NO % NO % NO %
POSITIVE 100 84 90 75 190 79.5
NEGATIVE 10 8 90 17 30 12.5
DON’T KNOW 10 8 10 8 20 8
TOTAL 120 100 120 100 240 100
Source: Questionnaire Survey, (2021)
Table 4.4 above, shows that the SBC Plc publics have positive perception
about the distribution channel strategies. This can be buttressed by the fact that a
total of 190 respondents, representing 97.5%gave their affirmation to the above
assertion.

26...
TABLE 4.5 DISTRIBUTION POLICIES BEING IMPLEMENTED ALONG
THE LINE OF SET OBJECTIVES
Response NO of Respondents Percentage

Internal Publics/ External public TOTAL

NO % NO % NO %
YES 80 67 70 58 150 62.5
NO 30 25 35 29.5 65 27
DON’T KNOW 10 8 15 12.5 25 10.5
TOTAL 120 100 120 100 240 100
Source: Questionnaire Survey, (2021)
Table 4.5 above indicate that the distribution are implemented along the
line of set objectives. This can be proved by the fact that a total of 150
respondents, representing 62.5% gave to the above assertion.
TABLE 4.6: VARIOUS PROBLEMS DISTRIBUTION USED BY
SBC FOR TACKLING DISTRIBUTION
Response No of Respondents Percentage

Internal Publics/ External public TOTAL

NO % NO % NO %
Multiple distribution 8 7 5 4 13 5.5
Selective distribution 8 6.5 21 18 29 12.5
Exclusive 4 3.5 4 3 8 3
All of the above 100 83 90 75 190 79
None of the above - - - - - -
TOTAL 120 100 120 100 240 100
27...
Source: Questionnaire Survey, (2021)
Table 4.6 above, shows that the company’s distribution channel strategies
use in tackling their distribution problems. And this can be proved by the fact that
a total number of 190 respondents, representing 79% agreed to the above
assertion.
TABLE 4.7: EXTENT GONE BY SALES DEPARTMENT IN COPYING
WITH SHORT DELIVERY OF TRUCKS.
Response No of Respondents Percentage

Internal Publics/ External public TOTAL

NO % NO % NO %
Very great extent 45 37 25 21 70 29
Great extent 55 46 75 62.5 130 54
Little extent 22 16.5 20 16.5 40 17
TOTAL 120 100 120 100 240 100
Source: Questionnaire Survey, (2021)
Table 4.7 above indicate that SBC Plc has gone to a great extent in coping
with the short delivery trucks. This dill be buttressed by the fact that a total
number 130 respondents, representing approval to the above assertion.
TABLE 4.8: PHYSICAL DISTRIBUTION POLICIES OF SBC PLC HAVE
ENCOURAGED CONSUMER LOYALTY
Response Variable No of Respondents Percentage

Internal Publics/ External public TOTAL

NO % NO % NO %
YES 100 92 115 96 225 93.75
28...
 NO - - - - - -
Don’t Know 10 8 5 4 15 6.25
TOTAL 120 100 120 100 240 100
Source: Questionnaire Survey, (2021)
Table 4.8 above, indicates that the physical distribution policies of SBC Plc have
encouraged consumer loyalty. And this can be buttressed by the fact that a total
number of 225 respondents, representing 93.75% gave their affirmation to the
above assertion.
TABLE 4.9: IF THE CHOSEN CHANNELS OF PHYSICAL
DISTRIBUTION HAS AFFECTED THE CONSUMER PATRONAGE OF
THE PRODUCTS
Response No of Respondents Percentage

Internal Publics/ External public TOTAL

NO % NO % NO %
YES 45 37.5 30 25 75 31.25
NO 60 50 80 67 140 58.34
Don’t Know 15 12.5 10 8 25 10.41
TOTAL 120 100 120 100 240 100
Source: Questionnaire Survey, (2021)
Table 4.9 above, shows that the SBC Plc chosen channels of physical
distribution have made an impact on the consumer patronage. And this can be
buttressed by the fact that a total number of 140 respondents, representing 58.34%
gave their affirmation to the above assertion.

29...
 CHAPTER FIVE
5.0 SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 SUMMARY
Based on the data analysis and. interpretation, the researcher arrived at the
following findings:
 The Management & Staff and Distributors of SBC Plc are knowledgeable of
distribution channel strategies of SBC Plc;
 NBC Plc Internal and External Publics (Management & Staff and
Distributors/Consumers) have positive perception about the distribution
channel strategies of SBC Plc;
 The distribution policies of SBC Plc are implemented along the line of set
objectives;
 The various distribution channel strategies used by SBC Plc for tackling
distribution problems include; multiple distribution, selective distribution and
extensive distribution channel strategies;
 The SBC Plc Distribution Department has gone to a great extent in coping with
short delivery of trucks;
 Physical Distribution policies of SBC Plc have encouraged their consumers
loyalty;
 There is adequacy in SBC Plc Sales Department programmes for the
satisfaction of existing and prospective customers;
 The SBC Plc chosen channels of physical distribution have made impact on the
consumer patronage

30...
5.2 CONCLUSION
The importance of distribution towards attainment of the company’s
marketing goals and objectives cannot be overemphasized. In fact, some
authorities are the backbone of marketing and commerce and that is why
marketing has been synonymous with distribution. Thus, an effective distribution
strategy is as important as product itself. This goes to support the view that for
effective and efficient distribution to occur, product and all other departments
necessary to enhance the satisfaction of customers’ need must work as a team.
Having seen the benefits or rather, the crucial role an efficient physical
distribution system can play, it then become imperative that the Seven-up bottling
Company Plc should maintain and even improve on the existing physical
distribution policies. This will enable the company to be in a better position in a
more efficient manner which will then enhance its repeat purchase/patronage
motive / objective.
The Seven-up Bottling Company will continue to be a clear leader in soft
drink manufacturing by employing a planned, coordinated and controlled physical
distribution system to serve her distributors and consumers in every nook and
cranny in Enugu metropolis.
The Seven-up Bottling Company will therefore, benefit more to continue
with the present distribution policies of mass/intensive/multiple, selective and
exclusive. With such well defined and coordinated organizational physical
distribution channels the company will continue to be clear leader in soft drink
manufacturing.

31...
5.3 RECOMMENDATIONS
Based on the above findings, the researcher therefore, recommends the
following measures to make the prevailing physical distribution policies of the
Seven-up Bottling Company Plc, Ilorin more effective.
1. For effective and efficient distribution system to take place, there must be a
corporate planning of all the departments concerned. Transport, sales,
production, marketing and purchasing should all work as a team to plan how
customers can be satisfied best without bottlenecks.
2. More powers or authority should be given to the depots managers to allow for
effective operation instead of a highly centralized system of management. This
will enable them to use their own initiatives whenever the need arises, instead
of sticking to the rigidly established guidelines.
3. The company should device a more effective and efficient way of monitoring
the activities of their distributors. Establishing more depots to allow for direct
dealings with the real consumers can do this. The various managements should
also provide management services such as training, inventory management
study, as well as sending sales people to help develop the marketing
programmes (display arrangements, location decisions and so on) for the
distributors. This will help the distributors to maintain the required inventory
as well as operate efficiently. Furthermore, disciplinary measures such as
terminating their distributorship rights or curtailing their quota should be meted
to erring ones
4. There should be positive and clear out approach for appointing distributors of
which honesty, integrity and code of ethics be developed for distributors.
Educational backgrounds should also form part of the qualifying criteria for
appointing distributors.
32...
In summary, it is envisaged that the present physical distribution policies of the
Nigerian Bottling Company in Enugu metropolis will improve if the above
recommendations are implemented.

33...
 REFERENCES
Borsodi, R. (1984): The Distribution Age; New York: Appleton and coy.
Clerk, FE. (1922): Principles of Marketing; New York: The Macmillan Company.
Daucla, O.A. (1979): Business Times, February 6.
Ejioffor, N. (1979): The Business of Hoarding in Marketing In Nigeria, Edited by
J.O. Onah; London: Cassel Ltd.
El-Rufai, N.A. (1984): New Nigerian Newspaper January27 Ezeaku, 1. C. (1980):
Commerce for the Certificate Year,
Enugu: Fourth Dimension Publishing Co., Ltd.
Frank, S. (2000): Quantitative Techniques for Management Decision; Boston:
Houghton Mifflin ltd.
Ifezuca, AN. (1990): Basic Marketing; Enugu: ABIC Publishers Ltd.
Ikeagwu E. (1998): Groundwork: of Research Methods and Procedures; (UNEC):
Institute for Development Studies.
Kotler, P. (1980): Principles of Marketing, 5th Edition; London: Prentice
International, Inc.
Kotler, P. (1980): Marketing Management, 2nd Edition; New York: McGraw hill
Inc.
McCarthy, J. (1981): Basic Marketing: A Managerial Approach, (7th Edition);
Homewood: III Irwin

34...
 QUESTIONNAIRE
Dear respondent
I am a student of the Department of Business Administration,
Institute of Finance and Management Studies, conducting research
on “Impact of Distribution strategies in Manufacturing Industry” a
case study of Seven-up Bottling Company Plc, Ilorin.
I am hereby request that you help me answer the following
questions with honest and I assure you that all information
supplied by you shall be used only for academic purpose and shall
be kept confidential.

Yours faithfully,
LAWAL DAMILOLA ZAINAB

Instruction: please (√) the answer you consider appropriate.

The questionnaire will be in two parts. Section A & B.
PART A
1. Sex (a) male ( ) (b) female ( )
2. Age (a) 18-30 years ( ) (b) 31-40 years ( ) (c) 41 – 50 ( ) (d) 51
and above ( )
3. Marital status (a) single ( ) married ( ) (c) divorced ( )
4. Occupation (a) student ( ) (b) business person ( ) (c) civil servant
( ) (d) others ( )
5. Education (a) SSCE ( ) (b) ND/OND ( ) (c) BSC/HND ( ) (d)
Others ( )

35...
 SECTION B
6. Does the physical distribution policies of the company one being
implemented with the set objectives? (a) Yes [ ] (b) No [ ]
7. What are the various channel strategies that helped to enhance
the company’s physical distribution problems? (a) satisfactory
[ ] (b) unsatisfactory [ ]
8. Does the sales department of the company cope with short of
delivery trucks vehicles? (a) Yes [ ] (b) No [ ]
9. What are possible solutions to the bottle necks being
experienced by the Seven-up bottling company? (a) Positive [ ]
(b) Negative [ ] (c) Don’t Know [ ]
10. Perception (feeling/impression) about SBC plc distribution
channel strategies (a) Positive [ ] (b) Negative [ ] (c) Don’t Know [
]
11. Various problems distribution used by SBC for tackling
distribution? (a) multiple distribution [ ] (b) selective distribution
[ ] (c) exclusive [ ] (d) all of the above [ ] (e) none of the above [ ]
12. Extent gone by sales department in copying with short
delivery of trucks? (a) very great extent [ ] (b) great extent [ ] (c)
little extent [ ]
13. Physical distribution policies of SBC plc have encouraged
consumer loyalty (a) yes [ ] (b) no [ ]
14. If the chosen channels of physical distribution has affected
the consumer patronage of the products? (a) yes [ ] (b) no [ ]

36...