CHAPTER ONE

1.1  BACKGROUND OF STUDY

Every business firm is involved in series of relationships. The consumer is at the end of this relationship chain. This relationship is facilitated by Marketing. There are four major tools employed in Marketing and they include Product, Price, Promotion and physical distribution.

A guiding philosophy in marketing, the marketing concept. Which proffers a systematic co-ordination in a firm’s relationship with consumer, demands the satisfaction of customers and profitable sales volume. In striving to ensure customers satisfaction with the right product, marketing activities become very important because the product will have to be priced, promoted and moved from point of manufacturing to point of sale. Thus the strategic role of marketing activities cannot be taken lightly.

In the bakery industry, there are relatively large numbers of firms found within the South Eastern States. The chairman Bakers’ Association of Imo State indicates that Bakery firms in the state have good products and a large pool of consumers waiting to be reached.

The competitive environment in the industry is helping the acquisition of new technology, new bakery machines and design.

11

The industry is operating in a social environment, which is characterized by preference for products manufactured outside the local environment.

This characteristic has had tremendous effects on the fortunes of the industry.

The political environment is not left out because the industry is believed not to encumber by severe legislations and tax regimes.

The umbrella trade union, Master Bakers’ Association ensures and maintains smooth relationship with governmental authorities.

The role marketing plays is satisfying the needs of consumers is very important. It is not limited to satisfying consumers’ psychological need; it also provides them with most desirable products at a profit. This task of satisfying consumers’ need involves the effective and efficient carrying out basic marketing activities. These marketing activities include activities related to the product itself, distribution, communication or promotion and pricing.

The Bakery industry is a developing industry and so requires well-programmed marketing activities to move forward. A negligence of these or their haphazard application may result to slower growth or even stagnation.

1.2  STATEMENT OF PROBLEM

Bread is a basic food consumed daily by a large number of people. It is sold in neighborhood retail shops and some specialized bread shops.

12

Since it is a staple food, it requires wide distribution for the products to get to the consumers.

Bakers make snacks including meat pies, doughnuts, burgers, biscuits, recu1rement on not only efficiency but on strategic flexibility also. Such flexibility is very important in the planning, execution and maintenance of marketing activities. This project is designed to investigate the bakery industry in the south Eastern States, how bakers operate, the products they produce, price and distribute.

Exploratory research reveals that the industry is plagued with the problem of low market coverage, with the attendant low profitability. The crucial problem in this study therefore is to identify and evaluate the marketing activities of the bakery industry in South East States with the aim of determining their strength and weakness in this aspect of their operation.

1.3 OBJECTIVES OF THE STUDY

The objective of the study intends to state the intention of the researcher to accomplish feasible task. This indicates the direction of the research work. Objectives of this study include:

1)          To find out the nature of bakery products available in South Eastern States

2)           To find out the pricing activities going on in the firm.

3)          To find out the modes of distribution used by these firms.

4)           To find out the promotional activities that the firms perform as part of their marketing activities.

13

1.4 RESEARCH QUESTIONS

1.  What is the nature of bakery products available in South Eastern States?

2.  What are the pricing activities going on in the firms?

3.  What are the distribution activities that are carried out by the firms?

4.  What are the promotional activities that the firms perform as part of their marketing activities?

1.5 RESEARCH HYPOTHESES

HO1: There is no relationship between product shapes or nature and business success

Hi:   There is a relationship between product shapes or nature and business success.

Ho2: There is no relationship between distribution modes and levels of sales.

Hi:   There is a relationship between distribution modes and level of sales.

1.6 SIGNI FIANCE OF THE STUDY

The primary significance of this study is to increase the body of knowledge as to the application of relevant marketing activities towards achieving stated company’s objectives/goals.

It is expected that this research effort would broaden the level of understanding as to how marketing activities are

14

undertaken by bakeries towards the enhancement of increased sales/profitability.

Further more, this research effort will go in depth into available literature and make additional contribution and recommendations where necessary.

The research is expected to be of immense benefit to firms in the industry and consumers of bakery products. It is not only going to answer the research question so as to address the problem statement, it will also result to specific benefits accruable from well-formulated and programmed marketing activities.

Also, it is expected that the result of the study will lead to better product offering, which means that the consumers will have product with higher utility available to them. Beyond these, it is expected that the findings will lead to more economic utilization of society’s resources, which no doubt will amount to higher competitiveness in the economy and reduction of macro economic problems.

1.7 SCOPE AND LIMITATION OF THE STUDY

This means the boundary of the study. It is the area in which the research intends to operate, concentrate and extends its operational tentacles. This means the area where the researcher cannot exceed during the research study.

In this research work, the researcher could not exceed the boundary of studying the marketing strategies adopted by the

15

bakery firms located within the Southern part of the country, with reference to the Eastern States. The distribution strategies is also another vital aspect of this study, modes of the distribution strategies adopted by each bakery firm analyzed in details.

In order to allow for in-depth analysis, this research work will be limited to bakery firms located within the South-Eastern States; Enugu. Anambra, Imo, Abia and Ebony States. Findings May not necessary hold true for industrial practices in other geographical zone, because o:’ differences that may exist in culture, religion and environmental factors. This research is also focused on the marketing activities of these bakery firms located within the South Eastern zone.

1.8 DEFINITION OF TERMS

1.  Not-so-Responsive Financial Environment:- This term describes the unwillingness of financial institution to extend credit facilities to bakery firms.

2.  Financial Public:- This includes all financial institutions that bakery firms enter into transaction which includes; banks, finance houses, insurance companies etc.

3.   Dynamic External Factor:- This describes all the variables that affect the operation of the bakery industry but are outside its control and world; financial, political, social, economic and business (competition) environment.