Impact of Physical Distribution on Customer Service: A Study of Pardee Foods Nigeria Ltd Ogun State
Chapter One
Objective of the study
This study aims at highlighting the importance of physical distribution in customer service a study of Pardee Foods Nigeria LTD Ogun state
To know the role of transportation in making the products available.
To examine whether warehousing assures time utility of consumable product.
To establish the effect of Pardee foods Nigeria LTD distributors on customer service level.
To determine the relationship between pardee foods Nigeria LTD distributors and customers service level.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
Definition of Physical Distribution
The growth in the importance of physical distribution has witnessed a corresponding growth in the number of associated names and definitions that are used. According to Rushton et al. (2010) some of the different names that have been applied include: physical distribution, logistics, business logistics, materials management, procurement and supply, product flow, marketing logistics, supply chain management, demand chain management and there are several more. There is no general name or definitive definition offered, because physical distribution can and do differ dramatically from one industry, company or product to another. So, these many terms are used interchangeably in literature and in the business world. According to Rushton et al. (2010) Physical distribution or logistics is concerned with physical and information flows and storage from raw material through to the final distribution of the finished product. They explained that supply and materials management represent the storage and flows into and through the production process, while distribution represents the storage and flow from the final 10 production point through to the customer or end user. They noted that a major emphasis is now placed on the importance of information as well as physical flows and storage, and an additional and very relevant factor is that of reverse logistics – the flow of used products and returnable packaging back through the system. Weiss and Gershon (2002) noted that, distribution describes all the logistics involved in delivering a company’s products or services to the right place, at the right time, for the lowest cost. Effective distribution provides customers with convenience in the form of availability (what, where, when – the right product, at the right place, at the right time), access (customers’ awareness of the availability and authorization to purchase), and support (e.g. pre-sales advice, sales promotion and merchandising, post-service repairs). 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 (Phillip Kotler and Armstrong ,2001). 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. According to Rushton et al. (2010) a supply chain consists of three types of entities, customers, a producer, and the producer’s suppliers. Supply chain management oversees and optimizes the processes of acquiring inputs from suppliers (purchasing) converting those inputs into a finished product (production) and delivering those products – or outputs to customers (fulfillments). The physical distribution systems say that all transporting, storing and product handling activities of a business and a whole channel system should be coordinated as one system that seeks to minimize the total cost of distribution for a given customer service level (Perreault et al., 2010). This systems approach to physical distribution management results in lower costs and better customer service which help to increase customer value and customer satisfaction.
Role and Importance of Physical Distribution in Marketing Strategy
Physical Distribution (PD) primarily is moving goods from origin to destination. Marketing strategy planning is based on meeting customers‟ needs better than the competitors. It seeks to 11 create a differential advantage within target segments by which a distinct competitive position relative to other companies can be established and from which profit flows. Delivering the right goods to the buyers at the right time and at the lowest possible cost is an important aspect of every good marketing program. Coyle et al. (2003) explain that Good logistics is business power …. because it helps build competitive advantage. At the end of the day if you cannot get your products to your customers, you will not stay in business very long. This is not to say that you do not need quality products and effective marketing. Both are obviously very important, but they must be combined with effective and efficient logistics systems for long run success and financial viability.
Customer service
Coyle et al. (1996) defined customer service as “an augmented product feature that adds value for the buyer. Regardless of how it is defined or perceived, customer services may be the best methods of gaining competitive advantage for many firms(Lambert,1993). It can be used to differentiate a firm‟s products, keep customer loyal and increase sales and profits (Tucker 1980, cited in Sharma and lambert,1994, p.50). LaLonde and Zinszer (1976) stated that customer service has three main components 1) an activity to satisfy customers‟ needs 2) a performance measure to ensure customer satisfaction and 3) a philosophy of firm wide commitment. LaLonde et al. (1988) defined customer service as a process which take place between the buyer, seller, and third party. The process results in a value added to the product or services exchanged. This value added in the exchange process might be short term as in a single transaction or longer term as in a contractual relationship. The value added is also shared, in that each of the parties to the transaction or contract are better off at the completion of the transaction than it was before the transaction took place. Thus, in a process view; Customer Service is “a process for providing significant value-added benefits to the supply chain in a cost -effective way”. Kyj (1987) defines customer service as the set of activities used by an organization to “win and retain customers.” The International Customer Service Association (ICSA) defines customer service as “those functions within a business that have customer satisfaction as their responsibility and provide that satisfaction through the fulfillment of sales order demand and/or information needs” (ICSA Certification). 12 Customer services is increasingly seen as fundamental for retail companies (Ellram et al.,1999), constituting the main output of logistics systems in supplier companies as well as the “place” component of their marketing mix (Stock and Lambert, 1992; Lambert,1994).
CHAPTER THREE
RESEARCH METHODOLOGY
INTRODUCTION
In this chapter, we described the research procedure for this study. A research methodology is a research process adopted or employed to systematically and scientifically present the results of a study to the research audience viz. a vis, the study beneficiaries.
RESEARCH DESIGN
Research designs are perceived to be an overall strategy adopted by the researcher whereby different components of the study are integrated in a logical manner to effectively address a research problem. In this study, the researcher employed the survey research design. This is due to the nature of the study whereby the opinion and views of people are sampled. According to Singleton & Straits, (2009), Survey research can use quantitative research strategies (e.g., using questionnaires with numerically rated items), qualitative research strategies (e.g., using open-ended questions), or both strategies (i.e., mixed methods). As it is often used to describe and explore human behaviour, surveys are therefore frequently used in social and psychological research.
POPULATION OF THE STUDY
According to Udoyen (2019), a study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitutes of individuals or elements that are homogeneous in description.
This study was carried to examine impact of physical distribution on customer service. Pardee foods Nigeria LTD in Ogun state form the population of the study.
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
INTRODUCTION
This chapter presents the analysis of data derived through the questionnaire and key informant interview administered on the respondents in the study area. The analysis and interpretation were derived from the findings of the study. The data analysis depicts the simple frequency and percentage of the respondents as well as interpretation of the information gathered. A total of eighty (80) questionnaires were administered to respondents of which only seventy-seven (77) were returned and validated. This was due to irregular, incomplete and inappropriate responses to some questionnaire. For this study a total of 77 was validated for the analysis.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
Introduction
It is important to ascertain that the objective of this study was to ascertain impact of physical distribution on customer service. In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in addressing impact of physical distribution on customer service
Summary
This study was on impact of physical distribution on customer service. Three objectives were raised which included: To know the role of transportation in making the products available, to examine whether warehousing assure time utility of consumable product, to establish the effect of pardee foods Nigeria LTD distributors on customer service level and to determine the relationship between pardee foods Nigeria LTD distributors and customers service level. A total of 77 responses were received and validated from the enrolled participants where all respondents were drawn from pardee foods Nigeria LTD in Ogun State. Hypothesis was tested using Chi-Square statistical tool (SPSS).
Conclusion
Basing on the findings, the researcher concluded that Pardee food distributors carry out physical distribution this is because they offer services such as warehousing, transportation, order processing, inventory control, customer service, packaging and material handling. These services directly affect customer satisfaction. The relationship between Pardee food distributors exists in terms of convenience, dependability timely delivery and effective communication. The service that is efficiently offered is customer service this means that there is need for the management to put more effort in the other services to enable them to reach the maximum level. Important to note is that the services offered by Pardee food distributors are not poor but they are optimal because most customers around Ogun state purchase the products of Pardee food distributors this is in relation to their competitors’ product
Recommendation
The company should deliver high physical distribution service as it is the most effective means of positioned in the market.
The company should focus on efficient delivery as it critical factors in the success of service-oriented business organizations.
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