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ABSTRACT
This project work examine the “impact of transportation cost on customer goods retail process”.
The
population addressed were the wholesaler each was drawn. Data were
collected using questionnaire that was distributed to the wholesales and
retailers of Afor Awkuanaw market (Garriki) in Enugu South Local
Government Area Enugu State whom the researcher believed were more
informed about the topic.
The data generated were analyzed using descriptive statistical tool, mainly frequency distribution with accompanying comments.
The major findings made include:
1. Cost of transportation affects agricultural goods retailers than manufacture goods retailers.
2.
Profit maximization was not always the desire for most dealers
particularly those who have retired and set no retail business in order
to avoid being ideal. The reported recommended that:
dealers should strive to procure goods from the one source in order to develop transporters.
CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
As life
started mankind begin to nurse the need for basic necessities of life
for physiological satisfaction as food, shelter, safety, among other
things.
At first man tried to provide the necessary things to satisfy
his needs to engaging in hunting, fetching some selected plants for
food and find shelter among tree shades as well as applying plants
leaves to cover his nakedness.
In the process of advancement man
learnt that he could not provide all his needs by himself. Then the
exchange process started. This began as an exchange of goods for goods
otherwise called trade by barter. The person who has a particular
product in excess of his need of that particular moment would look for
the person that has a need for his excess. Produce and at the same time
has the produce he lacked so that an exchange could take place.
So the earliest trading or buying and selling practices were done on retail basis through the barter process.
When
a common medium of exchange could monthly was inverted the practices of
trade by barter became less relevant in the exchange process. When
barter was in vogue buyers and sellers did not take a conscious account
of the cost and burden of carrying the goods around in search of a
market. As money became the means of payment even the service of
carrying marketable commodities tot eh market was paid for.
Price has
to be put on every commodity using money as the standard of
measurement. The seller in calculating the expenses of this business has
to add the cost of transporting product from the point of production to
the point of consumption.
In the ancient times, man used mostly the
bests of burden to carry his goods from the point of production to the
point of consumption, transportation nowadays has become more
sophisticated, convenient, and faster. Some of the mode of
transportation include transport on railway, motor vehicles on road,
ship, boats, canoes paddling though water and the airoplane flying I the
airway. The nature of production items of the order as well as the
location of the market and the type of the market will determine the
mode of transportation to employ. (Onyebunagu 1995).
Transportation is involved in every level of production and distribution until the product reaches the final users.
Industrial revolution came into place and led to increasing productive capacity.
Most
manufacturers and sellers want to enjoy the benefit of the economy
offered by large-scale production and distribution. They also aspire to
explore large markets and operate at competitive levels. They have to
manage costs and process to be able to operate with efficiency and
remains a float. In the Nigerian case, these distribution cost
specifically transportation costs are sometimes viewed as some of the
factors that account fro increasing prices of goods.
This study “the
impact of transportation cost on consumer goods retail prices”, a case
study of yam prices at the garriki market Enugu south L.G.A, Enugu State
will discover whether cost of transportation constitute significance
proportion of the price of consumer foods, particularly yams in the
Garriki market.
STATEMENT OF PROBLEM
There has been a continuous
increase in the price of consumers goods in Nigeria for many years now.
These price increases have been alleged to be as a result of increase in
the cost of raw materials, transportation, rent, capital and labour.
Among these variable, this study will attempt to determine the degree to
which cost of transportation affects process of consumer goods,
particularly this study tries to find out the following:
The
consumers allege that the increasing price are indication of the
profiting attitude of sellers. On their own side, the seller level the
blame of increasing prices on the increasing cost of input materials and
facilitating agents. The difficulty now becomes how to determine which
of the claims is the truth about increasing prices.
It has been
reported that the increasing price have confirmed to make many families
unable to fetch their three saure meals daily. The government, labour
and consumerists have show concern and made some efforts to bring the
price increase under control without making any tangible headway.
OBJECTIVES OF THE STUDY
The activities of
retailers in the market affect everybody in the society and most
consumers are dissatisfied with the rapid increase of prices of goods in
the market. This study is designed to:
i. Determine the effects of transportation cost on the prices of consumer goods particularly yam.
ii. Ascertain, if it is the desire for excessive gains that influence retailers infixing prices of goods.
iii. Find out what can be done to alleviate the problems of increase prices of consumer goods in the market.
RESEARCH QUESTIONS
The following research question are considered: -
1. Does cost of transportation contribute substantially to the price of yams?
2. Is it desire to make high profit that cause rapid price increase of yams in the market?
3. Have government efforts at reduction of prices helped to solve the problems of continuous price increase?
4. Does transportation cost lead to rise in the price of other category goods?
SIGNIFICANCE OF THE STUDY
This study will be of benefit to economic analysis who would want to trace the causes of inflation to their real sources.
It
will be of immense use to marketing and management experts who could
want some appropriate solutions to some of their marketing problems
efficiency.
It will be an interesting source of material for academicians doing research in retail pricing for yams.
It
will also be a useful piece of information for government in their
regulatory policies of price control and transport management.
It
will be a guiding tool for business people who are in the distribution
service because this work wil teach them how to control costs and make a
competitive pricing.
SCOPE AND LIMITAITON OF STUDY
For goods to reach
the ultimate consumers or final users the seller be he the producer,
wholesaler or retailer must get the appropriate transport to convey them
from point of sale to the point of buyer. This study intends to limit
itself to transportation of goods by retailers form their suppliers
(producer or wholesalers) to the point of sales of the goods or to the
final users in doing this, it will try to ascertain the effect of
transportation cost on the prices the retailer fixed for the goods.
The
commodity used for this study is “Yam”. The retail prices of yam study
is studied to be how they vary with costs of transportation. The market
located in Enugu South L.G.A Enugu State.
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