Assessing the Role of Standard Distribution Process in the Reduction of Petroleum Scarcity (a Survey of Ebonyi State)
ABSTRACT
This study entered on the “Assessing the role of standard distribution process in the reduction of petroleum scarcity, a survey of Ebonyi state”. The objectives is to find out how effective, distribution can reduce petroleum scarcity in our economy. To determine the rate of sati9sfaction, of customers with present level of distribution and to know it petroleum reaches the consumers at the right time and at right quantity or assortment. However, to collect adequate data for this research study copies of a questionnaire were used as a research instrument. The simple, percentage technique was used for the presentation, analysis and interpretation of data. Also the statistical tool, which was used in testing the hypothesis, was the chi-square. Chi-square is applied when there are two research variable draw from independent samples. The actual sample size was determined with the use of “Bourley” formula as a statistical tool as well. Finally, recommendations were made, it all these are adhere to, there will be no problem of petroleum again in Nigeria.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Distribution is concerned with the art and science of determining requirement, acquiring, maintaining these materials (both finished and unfinished) in an operational ready condition in their entire life.
In the past, they regarded distributions as supportive and subsidiary but the huge amount of money expended on distribution services such as transportation, inventory and warehousing has made marketers to revert their original thought and accord distribution the importance position it occupies.
The soaring cost of energy and the periodic shortages of transportation fuels tend to spot-light on the need for standard distribution system in our economy. Over the years, management has made a giant strive in reducing production cost as well effected cost reduction in many areas of marketing. Physical distribution is now the target perhaps, the last frontier for cost reduction, typically, distribution started with products at the plant and then tried to find, how cost of reduction to get an areas.
Thus, distribution is of overwhelming importance in any discussion of marketing function. Distribution creates time, place (by means of transportation) in the full sense of the world distribution must involve movement of products.
According to Peter and Domelly (2004) channel of distribution as a combination of institution through which a seller markets products to the consumers. Market channel can be compared, with a pipeline through which water flows from a source to termuius marketing channel make possible the flow of goods from a product through intermediaries to a buyer.
In Nigeria, where we experience perennial scarcity of petroleum products in certain locations, the petroleum products marketing (PPMC) usually pump more of the products to such areas to bring down the skyrocketing prices and thus stabilize prices. It is the careful manage of warehousing (storage) and transportation that helps to a achieve this feat. The management is expected, to set quantifiable performance standards for each sub-system of the distribution process.
And effective and efficient physical distribution, system is expected to create cost cutting avenues in the system with the aim of reducing the overall distribution cost at Enugu by extension impact positively on the price of the product and how the petroleum product can reduces the scarcity in an area by short supply but higher prices and using movement of product to stabilize prices during acute scarcity in certain markets. It therefore follows that no organization can achieve a meaningful level of survival and sustainable growth in such a society without beefing up its customer services standard.
1.2 BRIEF HISTORY OF PETROLEUM PRODUCT
Oil was discovered in Nigeria in 1956 at Oloibiri in the Niger Delta after half a century of exploration. The discovery, the oil was burned to evaporate brine and product salt. By the 10th century extensive bamboo pipelines connected oil Nigerian National Petroleum corporation NNPC was established on April I. 1977 as a merger of the Nigerian National Oil, corporation, development of petroleum has been known throughout time. It was used in mortar.
Petroleum distribution in Gwagwalada for a period of 12 years (2000-2012) problem of allocation distribution and marketing petroleum 26 Aug 2013, the poor allocation and distribution, of petroleum product. A standard retail outlet must meet some marketing storage.
29 Aug 2013, the Nigerian National process, refines, distribution and market crude petroleum and to revamp the economy through the reduction of the amount. The pipelines and product marketing company (PPMC) is the product distribution aim of NNPC. PPMC is directly responsible for the comparative, case with which petroleum products are standard and distributed to all parts of the country, at a uniform prices. A phenomenon, which Nigerians have come to take products to sustain our industries run automobiles and for domestic cooking.
The process by which PPMC receives crude oil from the NNPC unit called the National Petroleum Investments Management Services (NAPIMS) PPMC then supplies the crude oil to the NNPC local refineries however, petroleum products are sometimes imported to supplement local product when the local refineries are unable to process enough for the country’s needs.
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1.3 STATEMENT TO THE PROBLEMS
The statement of this problem is all about thee reduction of petroleum scarcity, it has been observed that distribution has not be put at a proper place (effective practice) in the petroleum industry hence cases of petroleum scarcity arise often.
The role of standard distribution process in this scenarios to ensure the availability of petroleum. Every where a affordable prices, but because distribution is not effectively practiced, the problems of petroleum scarcity arise, prices of goods and services increased frequenctly, in the economy due to this problem, thereby making things difficult for people. Petroleum products distribution in Gwagwalada for a period of 12 years (2000-2012) period of scarcity of fuel to sell at higher prices. This is done through the process of law of demand and supply. Problems of allocation distribution and marketing problems resulting sometimes, in petroleum product outgages inflated consequence, reduction of price of products for the benefit and exemptions or price controls with the aim of all which petroleum product play a major role. Different forms, these include grants, tax reduction of making petroleum products available to cushion the effect of channel oil.
1.4 OBJECTIVES TO THE STUDY
The objective of this study are to see how effectively distribution can reduce petroleum scarcity problem in our economy. Most organization does not apply distribution effectively, which problems are bound to occur. At the end of this research study, one will be able to understand the following,
- The problem associated with petroleum scarcity in Nigeria.
- To determine the effect of distribution in the reduction of petroleum scarcity in Nigeria.
- The proper solution to the problem of petroleum scarcity in Nigeria
- The reason why petroleum arise in Nigeria
- To analyze the present distribution systems with the aim to assessing its level of efficiency
1.5 RESEARCH QUESTION
The research question for this work will based on the following:
- How is the role of standard distribution in the reduction of petroleum product scarcity in Nigeria?
- To what extent does a good channel of distribution help?
- Will there by any improvement to the problem of petroleum in Nigeria?
- Does distribution bring about customers satisfaction?
- Do you think distribution can enhance the effective, delivery of fuel products to where they are needed by customer?
- Does vehicle breakdown affect the distribution of product?
1.6 RESEARCH HYPOTHESIS
This work is based on the following hypothesis
Ho: Distribution does not lead to enhanced sales
Hi: Distribution enhances sales
Ho: Distribution does not play any significant role in reduction of petroleum scarcity in Nigerian
Ho2: Distribution plays a significant role in the reduction of petroleum scarcity in Nigeria.
1.7 SCOPE AND LIMITATION TO THE STUDY
The research centre on assessing the role of standard distribution process in the reduction of petroleum product scarcity. The research was able to find out some constraint that may course inability of the organization to carried out their objective and some of this problem are to be seen as vehicle breakdown, consumer unsatisfaction, with the product.
However, the work is limited by the following, constraints.
Time Constraint: The time allowed for the work was limited. The research was to be completed within semester, coupled with numerous, academic activities thus, the research was constraint from going deeper in the research.
Communication Means and Finance: All these problems set a great limit to analysis of the data to be covected.
1.8 SIGNIFICANCE TO THE STUDY
Significance of the study tells how the society will benefit form this study. How organization will benefit from this study. The research study will be of great benefits to the management, of NNPC and other oil companies or the unions who engage in the production and distribution of petroleum product in Nigerian.
To look out for possible ways of curbing petroleum, scarcity problem. It will be beneficial to independent petroleum marketers in their business life and for any body that may wish to carry our further research or develop part of it.
Distribution gave way of consumer satisfaction, and well being of the society. Therefore its importance cannot be over looked.
1.9 DEFINITION OF TERMS
Distribution: The broad range of activities concerned with efficient movement of finished products from the end of the production like for the final customer and flow of raw materials, form their source of supply to the product line (O.G Anunwa 2008).
INVENTORY MANAGEMENT
Kotler and Armstrong (2004) identified that inventory, management affects customer satisfaction greatly. As such, manager must maintain the delicate balance between buy on the order carrying too much inventory results in higher than necessary inventory carrying cost and stock obsolesce.
ORDER PROCESSING
This is the ability of department being able to prepare orders before they go out of the warehouse, e.g physical distribution beings with a customer, order. The order department prepares multicopy invoices, loading forms, payment and dispatches them to various departments.
WAREHOUSE: A warehouse may be defined as a place, where good are stored. Thus, it could be said that warehousing perform the marketing function of scouring physical goods between the time they are produced to the period of their consumption. Thus it provides time utility. (O.G. Anunwa 2008).
MARKETING CHANNEL: This is set of independent, organization that involved in the process of making a product or service available for use or consumption by the consumer or business user.
Communication: It is the process through which information, facts, intentions, attitude, emotions and idea e.t.c. are transmitted by the sender and understood by the receiver (Kootz 1980).
