A Study on the Problems and Prospects of Marketing Industrial Products

A Study on the Problems and Prospects of Marketing Industrial Products

Chapter One of A Study on the Problems and Prospects of Marketing Industrial Products

INTRODUCTION

BACKGROUND OF THE STUDY

This research work is on the topic: problems and prospects of marketing industrial products in Nigeria. This work is centered on some selected production companies in Enugu metropolis. The researcher decides to use Emenite Nigeria Limited, Alo Aluminum and Ozomac Company as her case study. These manufacturing companies specialized in the production of roofing materials and other building materials. These companies are located in Enugu urban of Enugu State. Emenite Nigeria Limited is located in Emene industrial Layout Enugu. Alo Aluminum Company is located along Abakaliki expressway Emene Enugu while Ozamac Construction Company is located at Trans Ekulu Enugu. Emenite is a franchise firm that is owned by Etex group. This company has its corporate headquarters in Belgium. Emenite uses 60% of local raw materials in its production. At its conception, the company was nothing but only a roofing sheet factory. The prevailing situation now is from a mere roofing sheet industry to a fully building materials manufacturing company. The Alo Aluminum and Ozomac construction companies are Indigenous companies. They make use of 100% local raw materials in their productions. They started as mere roofing sheet companies, before they fully graduated into building material production companies.

These companies have their distributors located in some places in Enugu. These companies facilitate their performance with good distribution channel, availability of genuine products and efficient after sales services.

EVOLUTION OF MARKETING

Marketing is an old and a new profession. Marketing is old in the sense that, since the beginning of man, exchange or trade has been in existence.

The advent of barter system coupled with the concept of division of labour and the ensuring of specialization gave rise to the production of surplus.

People started making more than they need of certain products, so trade (change), which is the heart of marketing became inevitable. Marketing started evolving in earnest when small producers began to manufacture their goods in large quantities in anticipation of future orders, middlemen with their institutionalized channels then appeared on stage to facilitate the communication of buying and selling of the resultant increased output. The desired impetus was given marketing by the industrial revolution, which brought with its mechanization and consequent search for mass marketing.

The newness of the course marketing, lies in the fact that marketing is now scattered in such fields as selling advertising, pricing, production, design packaging, branding and physical distribution. These areas are major concern of marketing.

The advent of specialized sales department helped to a considerable extent in resolving the organizational predicament of market expansion. There was problem of communicating with the customers, but manufactures were compelled to shift certain marketing functions to the middlemen. Initially goods and services were sold to retailers, who eventually resold them to final customers.

INDUSTRY AND MANUFACTURING BACKGROUND

The history of Industrial development and manufacturing in Nigeria is a classic illustration of how a nation could neglect a vital sector through policy inconsistence and distributions attributed to the discovery of oil. The near total neglect of agriculture has denied manufactures and industries their primary source of raw materials. The absence of locally sourced inputs has resulted in low industrialization.

Today, the Nigerian industries and manufacturing sector account for less than 10% of Nigerian’s GDP, with manufacturing capacity utilization remaining below 35% for the most part for the cast decade.

Players in the Nigerian industrial and manufacturing sector can be classified into four groups; multinational, national, regional and local. Apart from the multinational operators, most of the players have disappeared in the last two decades, due to unpredictable movement policies, lack of basic raw materials most of which are imported.

Some of the constraints faced in this sector Include:

§ High interest rates

§ Unpredictable government policies

§ Non-implementation of existing policies

§ Lack of effective regulating agencies

§ Infrastructural inadequacies

§ Dumping of cheap products

§ Unfair tariff regime

§ Low patronage

Globalization and liberalization pose challenges to the Nigerian industrial sector. The impact of these global protections, increase focus on product quality and increase expenditure on research and development. The prospects of manufacturing in Nigeria are bright given the nations nascent democracy, a market size of over 120 million people, rich mineral and other resources size of the West African market as well as cheap and abundant labour. Developing Nigeria’s industrial sector requires the concerted efforts of government and the private sector to create an environment that would encourage investments, primarily by Nigerians as firm basic for attracting and sustaining foreign investment in the sector. A fully developed industrial sector world provides a firm basis for sustainable economic growth and development.

The most pronounced objectives of most business ventures is profit making. This objective is achieved when the products and services get to the final users or customers at the right place right time and right price. The reason is that firms depend on the customers for the sale of their products. Marketers are no longer in doubt as to whether their products are needed in the market place, but are interested in knowing the problems that associate with the marketing of industrial products. The study of problems and prospects of marketing industrial products allows marketing managers to develop an insight into what lies behind the problems and prospects of marketing industrial products in Nigeria. Also knowing the cause of the problems and solutions are important.

Firms in building material industry like Emenite, Aluminum and Ozomac construction companies etc. want to know those problems that associate with marketing of industrial products. The pressing need and task facing the manufactures and marketers of industrial products is to find out the factors or variables that exert the greatest problem in marketing industrial products.