EFFECTS OF PHYSICAL DISTRIBUTION ON THE SALE OF CONSUMABLE PRODUCTS

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EFFECTS OF PHYSICAL DISTRIBUTION ON THE SALE OF CONSUMABLE PRODUCTS

Chapter One Introduction 1.1: Background to the Study

In today’s market, selling a product can be easier than delivering it to clients. Companies have decided on the best approach to store and transport their products and services so that they are available to customers in the appropriate quantity, at the right time, and in the right location.

According to Kotler and Armstrong (2010), Physical Distribution (marketing logistics) is the process of planning, implementing, and controlling the physical movement of materials,

finished items, and related information from the point of origin to the site of consumption in order to meet customer demand while being profitable.

Physical Distribution is the study of the physical movement of products from the point of production to the point of consumption. It is a system of trade activities that collects the products of individual producers and distributes them to diverse customers.

At a higher level, you cannot please customers unless the product provides physical distribution and has a stronger impact on the company’s success.

Physical distribution is a crucial aspect of marketing finished products or raw materials that are present or available at the point of use or consumption. This is accomplished by the actual movement of the items,

which includes transportation, storage (warehouse), and logistical information until they are consumed. Because consuming is the essence of production, physical distribution is critical to a company’s success.

The economic impact of physical distribution is huge because it accounts for the largest component of marketing costs; approximately 20% of every naira spent goes towards physical distribution, and this cost (physical distribution cost) varies dramatically from industry to industry. Every naira saved during physical distribution has the same impact on profitability.

Customers benefit from physical distribution because it makes things available in the appropriate place, in the right form, and at the right time. Marketing logistics includes order processing, inventory management, material handling, warehousing, and transportation.

1.1.1 Historical Background of the Study

Unilever was founded in 1929 by the merging of British soap manufacturer Lever Brothers and Dutch margarine firm Margarine UNIC, a merger that was based on the desirability of palm oil as a commercial raw material for both margarine and soap, which could be traded in huge quantities.

Unilever was once known as Lever Brothers. It was founded in Nigeria in 1929 as West African Soap Company Limited. It changed its name to Lever Brothers Nigeria Limited in 1995, and it is now one of the leading consumer goods producers, with subsidiaries in around 70 countries.

At the Annual General Meeting (AGM), the company’s management and shareholders agreed to change the company’s name from Lever Brothers Nig Plc to Unilever Nig Plc, which was effective January 2002. Unilever employs over 3,700 people across its four factories in Apapa, Isolo, Aba, and Agbara.

The head office and initial plant are located at No 15, Dockyard Road, Apapa in Lagos State, where the following items are manufactured.

– Soap: Asepso, Astial, Lifebuoy.

– Scourer – Vim.

– Personal Products: Close Up.

The Aba plant in Abia State was built in 1959, and it manufactures the following products:

– Ox, Key, and Sunlight laundry soap.

– Detergent: Blue, Omo, and Rim

The Agbara factory in Ogun State is an ultra-modern food factory built in 1985, producing

– Edible fat and oil, as well as a master line of products that serve as bakery confections for other culinary sectors.

– Tea and coffee: Lipton Yellow Label Tea, Bongo, Bon Café.

– Drink: Tree top selection of tastes.

– Bonillon: Royce Cubes

The cheese product factory is located in Isolo, Lagos State. It was formed in 1998 when cheese and Unilever Plc merged. The factory manufactures toiletries and cosmetics. It is worth noting that, despite its age, Unilever has a total plant capacity of approximately 190,000 per year and produces fewer than 52 brands of products.

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