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INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Human life is complicated. Man does not possess enough instinct to do all the
things that are expected of him within the environment in which he lives. Business
is a human activity that occurs within the social framework, it involves a large
number of people, all of whom are of a social order.
A marketing oriented firm looks outward to the environment in which it operates
adapting to take advantage of emerging opportunities, and to minimize potential
threats. In this chapter we shall examine the general background information and
problem surrounding the subject matter of marketing environment.
According to W.J. Station: marketing is the total system of interacting business
activities designed to plan, price, promote and distribute understand the importance
of continuously monitoring and adapting to that environment.
Marketing environment according to Bunch and Houston (1985) is defined as "a
set of, diverse, dynamic and uncontrollable force that impinges on an organization
marketing operation and opportunities". However, marketing is concerned with the
identification of consumer needs and the various means by which such needs could
be satisfied. This is known as societal marketing.
The societal marketing concept holds that the organization should determine the
needs, wants and interest of target markets with satisfaction of the society's welfare
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needs. The societal marketing concept questions whether the pure marketing
concept is adequate in an age, of environmental problems, resources shortages,
rapid population growth; worldwide economic problem had neglected social
services.
The societal marketing concept calls upon marketers to balance three
considerations in setting, the marketing polices namely:
Consumer Satisfaction
Company Profit
Society Interest
CONSUMER SATISFACTION is been geared towards product brand loyalty
and institutional loyalty, which ushers in continuous marketing effectiveness. The
acid test of consumer satisfaction is the marketers' success in customer attraction
and customer retention.
Kotler (2003) when talking on customer attraction contend that customer will buy;
from the firm that they perceive offers the highest customer delivered value.
On customer retention, Rust et al (1992) identify three main approaches to value
building for retaining the trooping customer from all centers. The three approaches
are:
Adding financial benefit.
Adding social benefit
Adding structural ties.
While financial benefits are added through frequent marketing programs and club
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marketing. Social benefit involves customization and giving personal
specialization attention to individual clients rather than dealing with them
generally. Structural ties entails provision of special equipment forms for
maintenance records, order, payroll, and inventory.
Ducker (1982) opined "a healthy business cannot survive in a sick environment
that is why the macro marketing environment has to be studied and well analyzed
if the company wants to achieve its organization goals and objectives". The firm
looks into its macro environment i.e. the uncontrollable forces or external
environment in business activities.
Companies and their suppliers, marketing intermediaries, customer, Competitors
and public all operate in a macro environment of force and tread that shape
opportunities and pose threats to the effective and efficient performance of
business organization as well as achieving its goals. The effect of macro marketing
environment i.e. demographic, economic, natural, technology, politics and culture
on the business performance are analyzed and the extent of this can be used in
relation to Small Scale Industry. The knowledge of uncontrollable variables helps
an organization to identify and analyze new opportunities and threats. These
external environmental factors are static and residing, which are usually and
constantly changing.
Therefore, macro-marketing environment consists of the forces that are external to
develop and maintain successful transaction with the target market.
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1.2 STATEMENT OF THE PROBLEM
The Nigerian business environment, in particular, is full of complexities, fluidity,
uncertainties and instability. Many factors operates at cross purposes; many
decision are made which lack rationality; many steps are taken which defy good
explanations and lack factual basis; not to talk of governmental and macro-
economic policies which are made and reversed instantly. Change is an important
dimension of human and organization survival and growth. But change for the sake
of change, or changes that are blindly conceived and implemented, can be
detrimental to organizational growth and development
1.3 OBJECTVES OF THE STUDY
The primary goal of this research study is to achieve the following objectives:
To explore the process of scanning the marketing environment
To examine the significant role played by small and medium scale enterprise
(SMEs) in their survival
To educate small and medium scale enterprise (SMEs) about the importance
of marketing environment scanning.
To examine the extent to which small and medium scale enterprise (SMEs)
in Nigeria conduct marketing environment scanning.
To bring into sharper focus discipline, models, concepts and other aspects of
environmental analysis.
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1.4 RESEARCH QUESTIONS
The primary goal of this research study is to ask the following questions:
What are the processes involved in scanning the market environment?
What are the significant role played by small and medium scale enterprise
(SMEs) to survive?
To what extent small and medium scale enterprise (SMEs) in Nigeria
conduct marketing environment scanning?
What are models, concepts and other aspects of environmental analysis?
1.5 FORMULATION OF RESEARCH HYPOTHESES
In order to arrive at a reasonable conclusion the researcher had put forward the
following hypotheses
Ho: Scanning the marketing environment is not an effective tool for
gaining competitive advantage
H1: Scanning the marketing environment is an effective tool for gaining
competitive advantage
1.6 SIGNIFICANCE OF THE STUDY
The macro-marketing environments are the uncontrollable variables that are
outside the enterprise which influence marketing management decision. The
importance of the study cannot be over emphasized. The success or failure of any
firm is determined by the success of the firm within its environment. This study is
important in the following sense:
i. It helps the management in adopting a stable policy for the establishment
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through an active study of the macro marketing environment and the
government policies.
ii. The study will aid business establishment in marketing and constructing
marketing management decision in a way to suit the nature of the
environments.
iii. Due to the changing nature, of business environments, the study will
enhance the adaptability and flexibility rate of the firm.
iv. The main aim of every establishment is to make profit this ispossible by the
in depth knowledge of the environment and effective business operation.
This project will provide information that will help an organization in
achieving this.
1.7 SCOPE OF THE STUDY
The central concern of this research study is impact of business environment on the
performance of small scale industry in Nigeria using Small and Medium Scale
Enterprise in Lagos Highland as a case study. These have effect on the operation of
a firm. The research will take conscious effort to study these marketing
environments as a whole; the macro marketing environments and its effect on
organization, including the impact of government policies on small scale business
performance. The discussion will be central to impact of business environment on
the performance of small scale industry in Nigeria with specific reference to
(SMEs) within Lagos Highland Local Government without dwelling extensively
on marketing strategy, branding etc.
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1.8 DEFINITION OF TERMS
MARKETING: Marketing is a management process responsible for identifying,
anticipating and satisfying consumer's needs and want.
IDEAS: Every marketing offering include a 'basic idea, "product and services are
platform for delivery some idea or benefit.
PRODUCT: Is' a set of benefit offered to customers to satisfy their needs. 1, 5
Also they are and thing, that can be offered; to market for attention, acquisition,
use or consumption that might satisfy a want or need.
SEVICES: Services are any activity benefits that are party offer to another that is
essentially intangible.
WANTS: Needs become wants when they are directed to specific object that
might satisfy the heeds. Wants are the form taking by a human need as shaped by
culture and individual personality
DEMANDS: Human wants that are backed up by buying power.
MARKETING; ENVIRONMENT: Marketing Environment is defined as set; of
diverse, dynamic and uncontrollable forces that impinge on an organization
marketing operation and opportunities (Bunch and Houston).
MARKETING CONTROLLABLES: They are set of controllable variables a
manufactures use to influence the buyers response in a given market situations.
MARKETING UNCONTROLLABLE: These are aspect of environment of
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marketing which cannot be influenced or controlled by the organization.
MARKETING INTERMEDIARIES: These, are channel members that aid the
company in promoting, selling and distribution of its goods and services to me
final consumers
ECONOMIC ENVIRONMENT: This is the economic condition in which if the
company operate within.
SUPPLIERS: These are firm and individual that promotes the resources and
materials needed by the firm to enhance it production.
DEMOGRAPHY: also know as population. Population is the total number of
people living in a particular area.
TECHNOLOGY: They are technological advancement in new society.
CULTURE: These are the customs and beliefs art, away of life and social
organization of particular country or group.
DISTRIBUTION: These are the physical transportation of raw materials from the
production point to the final consumer or place where they are needed through the
channel of distribution.
FACILITATORS: These are mainly the agents whose main focus is to facilitate
the operation of the firm.
ENVIRONMENT: This refers to all the surrounding conditions, norms and
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groups mat influence the growth and development of the firm
MANAGEMENT: These are group of people which are committed to the task of
ensuring that a number of diverse are performed in such a way that define
objectives are achieved.
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CHAPTER TWO
2.0 LITERA TURE REVIEW
It has been noted that different authors' processes different opinions and views on a
particular subject matter. Authors and marketing managers have repeatedly
emphasized on talk on outside view of their business. They have shown great
interest in the central issue of marketing environmental scanning as it affects
competitive advantage of an organization operating in a constantly charging
competition.
2.1 MARKETING ENVIRONMENT
Clearly, marketing success depends on developing and a sound marketing mix (the
controllable variable) adapted to trends and developments in the marketing
environment (the controllable variable). The marketing environment represents the
set of uncontrollable forces to which the company must adapt its marketing mix.
According to Kotler (2003) a companys marketing environment consists of the
actors for forces that are external to the marketing management function of the
firm and that impinge on the marketing managements ability to develop and
maintain successful transaction with its target customer.
The environment is made up of factors that are outside the control of the firm
which must be monitored in order to determine the appropriate step to take per
time.
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This include the state of economy which determine the level of
i. Primary demand
ii. Level of saving
iii. Credit families
iv. Inflation
v. Spending patterns.
Other factors include technology, politics, competitors, suppliers and
intermediaries' customers that influence industrial buyer decision. Marketers can
do little or nothing to stimulate demand since it's the state of the economy that
stimulates this.
Moreover, .these variables involves a sort of a chain reaction in which one factor
affect the other i.e. the economy outlook is made up of purchasing power and
spending patterns which in turns depend on the level of income. The same thing
applies to' the technological state, political terrain and competitive climate; all of
which affect buyer's decisions. As a result of this, there should be proper
monitoring of these factors to determine; how the buyer will react and what they
can do to the problem and change threats to opportunities. This may involve a little
effort of SWOT analysis, as this will provide a good basis for decision-making.
MARKETING CONCEPT: It acknowledges that a business geared to serve the
needs and requirements of consumers will achieve a better result over a longer
period than a company whose executives are so motivated towards the satisfaction
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of consumers the customers that buy the product of the company. They however
help the organization to carry out its task or function,
SUPPLIER: Company to produce goods and service uses it to describe business
firms who provide raw materials needed. For example: Nigeria bottling company
uses carbon dioxide (gas) water as their major resources which are supply by the
suppliers. Suppliers play a tangible role in the activities of any marketing of an
organization. Marketing executive needs to watch price trends of their key input.
Marketing managers are equally concern with supply availability, supply
shortages, labor strikes and other events that can prevent fulfilling delivery
promises.
MARKETING INTERMEDIARIES
These are firms that help the company in promoting selling and distribution of its
goods to final consumer. This include physical distribution firms i.e. those that
helps the company in stocking and moving it from its original location to their
ware house, marketing - services, agencies i.e. the firm that help in advertising, the
company's product through media and marketing constructing firms and financial
intermediaries, includes banks credit company, insurance company and other
institution that help finance the marketing organization.
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CUSTOMERS
A company links itself with suppliers and middlemen so that it can efficiently
supply appropriate product and services to its target market which include:
a. CONSUMER MARKET: organization and individual that buy goods and
services for personal consumption.
b. INDUSRIAL MARKET: Organization and individual that buys goods and
services needed for producing other products and services for the purpose of profit
making and achieving other objectives.
c. RESELLER MARKET: Organisation that buy goods and services in other to
resell them at a profit.
d. GOVERNMENT MARKET: Government and non profit agencies that buy
goods and services in order to produce,-public services or transfer these; goods and
services to other in are in need of it.
e. INTERNATIONAL MARKET: A company or buyers found abroad including
foreign consumers, producers, and resellers and foreign and government.
2. COMPETITIVE ENVIRONMENT
A company rarely stands alone, on its effort to serve the market but is matched by
a lot of similar effort on the part of other. A company's marketing system is
surrounded and affected by a lot of competitors. These competitors have to be
identified, monitored and captured in order to maintained customer loyalty.
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The competitors of particular firms can be classified into:
i. GENERIC COMPETITION: this is a product that is different in nature
but for the same uses e.g. what I want to use to improve cycle or bike? These
three mobile means are agencies to compete in transportation, a car, an aero
plane, and a bus.
PRODUCE FROM COMPETITION: This is a product with different character,
but of the same uses.
BRAND COMPETITION: - They are enterprises that product similar in products
with the firm, it is essential that the marketing manager studied the cost structure,
pricing policy, promotional strategy and distribution methods adopted by other
competing firm which might influenced its operation.
3. PUBLIC ENVIRONMENT
Firm has to study whether the public welcome its product or not, its method of
doing business because the action of the company affect the interest of other
groups and the groups become significant public and it is define as any group that
has an actual or potential interest or impact on a business: abilities to achieve its set
objectives. A company can take concrete steps to manage successful relations
department to plan constructive relations with various publics. Six types of public
are identify below.
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i. GENERAL PUBLIC: This is the totality of the public that surrounds the
firm while general public does not act in an organized way toward the
company, the public image of the company affects its patronage.
ii. INTERNAL PUBLIC: A company internal public includes blue colour
workers, managers, and the aboard of trustee. Large companies develop
newsletter and other forms of communication to inform and motivate its
internal public. When employee felt; good: about their company this positive
attitude spills over to external public.
iii. LOCAL PUBLIC: That is every company faces publics such as
neighborhood resident and community organization.
iv. FINANCIAL PUBLIC: Those are financial institution, banks, investment
house, and stock brokerage firms, insurance companies that affect the
company's ability to obtain funds. The organization mostly seeks, the
confidence of the groups by issuing up to date annual report that financial
questions and managing money conservatively.
v. GOVERNMENT PUBLIC: Companies need to take government
development into account in formulating market plans. Government
regulations and intervention in business is common nowadays. Safety of
products, truthful advertising and fair pricing has been things of concern to
government through appropriate ministry or government.
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vi. CITIZENS/ACTION PUBLIC: These are local public interest group like
consumer association and other groups. These interests group activities may
impede in facilitating the firm operation. The complaint must be
diplomatically handled. A good public relation department is desirable to
handle such issues.
Lastly, it would be a mistake for a company to leave public relation in the hand of
the public relation department. All the organization employees are involved in
public relation, from-the chief, executive officer who makes headlines in the press
to the financial, who addresses the; financial community.
4 GOVERNMENT ECONOMIC POLICIES AND ITS EFFECT ON A
BUSINESS ORGANISATION
The economic environment in which an organization functions is extremely
complex; it is one of the macro factors impinging on the performance and
operations of an organization in which it operate. A firm performance is greatly
influenced by the economic policies of the government, operating within it and
dynamic business fluctuation that tends to follow a cyclical composed of strategies.
The economic cycle according to Omotosho et al comprises:
1. Recession
2. Depression
3. Recovery
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4. Prosperity.
No marketer can disregard the economic climate in which one's, business function,
for the type, direction and intensity of firms, marketing strategy depend upon it. In
addition, marketer must be aware of the economy's relative position in the business
cycle, how it will affect the position of the particular firm. This requires the
marketers to develop accurate forecast of future economic activity.
By necessity, marketing activity differs with each stage of the business, cycle.
During prosperous time consumer are usually willing to buy than when they are
economically threaten. However, the economic condition is significant forces,
which affect the marketing system. The major economic trends are examined as
follows:
1. Inflation and Deflation: Other economic factors that critically influence
marketing strategy are inflation and deflation. Inflation occurs in an
economic sector of a country when the price level rises as a result of
reduction in purchasing power of the consumer. This happen when too much
money pursues little quantity of goods. Inflation affects performance of
business organization in the sense that the purchasing power of the public
will be too small compare to the high cost of the goods in the market.
Government makes use of deflationary policies in this case when there is too much
money in the circulation and thereby tries to reduce it. Moreover, deflation also is
the situation where there is too much money in the system. In this case, theeconomy sectors of the country experiences enough money in circulation i.e. the
purchasing power of consumer raises compare to that of the inflation i.e. the
consumers are able to spend, their income more on products of the firms and this
consequently has direct or indirect effect on the performance of organization.
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2. Level of Income: The level; of income of individuals, firms, and
organization determines what such buyers will purchase. If the level of income of a
consumer increases definitely it will have positive effect on the sales of the
manufacturer. Also, the lifestyle of a consumer depends greatly on how such
person spends his income and its all depend on the income level.
3. Borrowing Power of Consumer/Lending Rate of Banks
In the case of economic depression, the opportunity to borrow is narrowed down
because in this case the country economy is undergoing a high level of exchange
rate in the foreign exchange. Where their opportunities are given, the cost of the
credit or rate of interest is rather too high and this remains the business of
manufacturers of durable items where credit facilities are essential to setting.
2.3 SWOT ANALYSIS
SWOT is an acronym for Strength, Weakness, Opportunities, and Threat. Cole
(2003) opined that situation analysis is a technique for matching organizational
strength and weakness with environmental opportunities and threats, to determine
the organization right need or position. Strategic planners have many ways to scan
the environment for opportunities and threats. They can study the following; Shift
in economy, Recent innovations, Growth and movement among competitors,
Market treads, Labor availability and Demographic shifts Environment
opportunities and threats must be sorted out carefully. In order to do this
effectively and efficiently, the firm must define its business correctly, identify its
target customer and then carry out a SWOT analysis which will take stock of the
existing situation and thereafter a decision on the type of product or type of
marketing strategy to adopt.
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ANALYSIS OF SWOT
In SWOT analysis, a company needs to detect the various factors that affect their
opportunities at the micro and macro levels and to use the appropriate strategy at
the right time. This enables the company to face challenges which will lead to
development.
According to Oyeniyi (2000) SWOT involves two basic groupings which are:
1. INTERNAL
2. EXTERNAL
Internal t is made up of strength and weaknesses. External is made up of
opportunities and threats.
1 STRENGTH AND WEAKNESSES
INTERNAL SWOT: It is one thing to detect alternative opportunities in the
environment; it is another thing to have the necessary competence to succeed in
this opportunity. Each business needs to evaluate its strengths and weaknesses
periodically.
The following factors can form the basis of analysis of strength and weaknesses:
i. Company's reputation
ii. Market share
iii. Quality reputation
iv. Service reputation
v. Profitability level
vi. Promotion effectivenessvii. Price suitability
viii. Level of sales
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2 OPPORTUNITIES AND THREATS
EXTERNAL SWOT: An organization marketing opportunities is an attractive
arena in which the competitive advantage. These opportunities should be classified
according attractiveness and the success probability that the company will have
with each opportunity.
A threat can be seen as a challenge posed by an unfavorable condition in the
environment that would lead in the absence of purposeful marketing action to the
erosion of the organization position.
The various identified threat should be classified according to their seriousness and
probability of occurrence. Major factor consider in this regard are the external
uncontrollable variables which are
A Economy
B Demography
C Technology
D. Politics
E Competition
F Income
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2.3 MACRO ENVIRONMENT AND ITS EFFECT ON BUSINESS
ORGANISATION
The macro-marketing environment comprises the actors and forces that are
external to the marketing management function of the firm and that infringes on
the marketing management ability to develop and maintain a successful business
within its target market.
It is also defined as the totality of the institution and force that are externally and
potentially relevant to the firm activities. The marketing macro environment
comprises of the non- controllable actors and forces in response of which an
organization designs there marketing strategies. Jim (1973) emphasized that the
firm cannot control these external forces.
A company marketing system operates within the framework of force that
constitutes the system environment. These are forces either external or internal to
the firm. STANTON (1964) opined that external forces generally cannot be
controlled by the firm. The first sets are "TASK" environment and the second are
called 'MACRO' which cannot be influenced by the organization and they include
technology, economy, political and legal, socio cultural factors.
These forces represent "uncontrollable" which the company must monitor and
respond to. The environment consists of forces infringing on the company
marketing system and are generally uncontrollable by the management. These are
six forces which are POLITICAL, ECONOMIC, SOCIAL, CULTURE,
TECHNOLOGY AND DEMOGRAPHY.
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2.3.1 THE POLITICAL ENVIRONMENT
Laws enacted at the Federal, state and Local Levels as well as independent
regulatory services exercise a lot of influence on the, marketing activities of a firm.
Price Control Decree 1970, Resale price maintenance and Food and Drug Decree
1974 and other regulatory measure affecting advertising, packaging and
distribution system. Marketing decisions are typically affected in a variety of ways
by developments. This part of the environment is composed of laws, pressure
groups and government agencies all of which exert some, sort of influence and
constraint on organizations and individuals.
The amount of legislation affecting business has increased steadily over the past
two decades. This legislation has been designed to achieve, a number of purposes
1. Protecting Companies from each other by means of Laws such as the
Restrictive Trade Practices Acts (1956 and 1976) and Fair Trading Act
(1973) all of which are designed to prevent unfair competition.
2. Protecting consumers from unfair business practice which brought about
consumerism. Consumerism according to Kotler and Armstrong (2001) is an
organized movement of citizens and government agencies to improve the
rights and power of buyers in reaction to sellers.
Traditional buyer's right include
a. The right not to buy a product that is offered for sale.
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b. The right to expect the product to be safe.
c. The right to expect the product to perform as claimed
Comparing these rights, many believe that the balance of power lies on the seller's
side. True, he buyer can refuse to buy. The buyer has too little information,
education and protection to make wise decisions when facing sophisticated sellers.
Consumers advocates call for following consumer right:
a. The right to be well informed about important aspects of the product.
b. The right; to be protected against questionable products and marketing
practices.
c. The right to influence products and marketing practices in ways that will
improve the quality of life.
3. Protecting society at large from irresponsible business behavior, which leads
to ENVIRONMENTALISM. Environmentalism is an organize movement of
concern citizen and government to protect and improve people's living in the
environment. Environmentalist is not against marketing and consumption
they simply want producer to operate with more care for the environment.
They feel marketing system goals should not be to maximize consumption
or consumer choice, or consumer satisfaction but to maximize life quality
plus life quantity, which is equal to life quantity and equality of consumer
goods, services and idea plus the quality of the environment.
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It is important therefore that the marketing planner is aware not only of the current
legislative framework, but also of the ways in which it is likely to develop and
how; by means of industry pressure group and lobbying of parliament, the
direction of legislation might possibly be influenced so that it benefits the
company.
2.3.2 ECONOMIC ENVIRONMENT
The main economic factors that have implications for marketers are:
a. Income,
b. Inflationary pressure
c. Savings and consumer expenditure patterns
A. INCOME
People alone do not make a market; they have to have some money to spend.
Income should be analyzed in terms of its distribution and how it is spent.
Personal Income refers to income from wages, salaries, dividends, rent, interest
and business activities. When all personal, federal, state and local taxes and non
tax payments such as union deduction is deducted, it equals disposable personal
income Disposable personal income less expenditures for food, clothing,
household utilities, local transportation, rent, house mortgage payment if any debt
payments and insurance equals discretionary purchasing power.
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The marketer is interested in the discretionary purchasing power because it is a
more sensitive indicator of; the ability of a consumer to purchase non-essential
items. The total purchasing power is a function of current income, price, savings
and credit availability.
B. INFLATIONARY PRESSURE
Inflation makes consumers to be sensitive to price. Consequently, the consumers
search for Opportunities to save money by resorting to buying cheaper brands in
larger or economy sizes and from relatively inexpensive outlets and performing
some of their service by themselves.
C. SAVINGS
Consumers' expenditures; are significantly influenced by their post savings and
access to credit facilities. Most working class in Nigeria holds their savings in me
form of bank savings .accounts, insurance, stocks etc. Although the inflation rate
has reduced to the purchasing power which can be used to supplement the current
income.
D. CONSUMER EXPENDITURE PATTERNS
Marketers would realize that as people's incomes change they should expect some
shifts in the relative demand for various categories of goods and services. It is the
responsibility of a marketer to learn more about the particular type of shifts. Within
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the majority of small and medium sized firms, the economic environment is
typically seen as a constraint since ability of a company to exert any sort of
influence on this element of the environment is difficult. The shift can be identified
as:
1. An increase in real income growth
2. Continuing inflationary pressures.
3. Changes in the Savings and Debt ratio
4. Concern over levels of the third world debt.
5. Different consumer expenditure patterns.
In an economy environment marketers invariably need to take account of the
following areas:
a. Patterns of real income distribution
b. Patterns of saving and debt
c. Expenditure patterns
d. Inflationary and deflationary pressure
2.3.3 DEMOGRAPHIC ENVIRONMENT
Demographic environment is the size, structure and trends of population that exert
the greatest influence on demand. Demographic environment is said to the greatest
influence on a business because of the following:
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There is a strong relationship between population and economic.
The absolute size of the population that acts as the boundary condition
determining potential or primary' demand.
Marketers are keenly interested in the size and growth rate of population in
different cities, regions and nations, age distribution and ethnic mix, educational
levels, household patterns and, regional characteristics and movements. The
followings are the major demographic trend and their implication on marketing
plan.
I AGE DISTRIBUTION: Apart from the total population, the distribution
population into age group has revealed to business activities well so that
different items and services are required by different age group.
A population consisting of mostly teenager will favor a company that
produces confectioneries, modern footwear and school uniform
ii. SEX DISTRIBUTION: - If the population of female is greater than that of
the male, female product will be manufacture and will be on great increase.
For instance, high rate of female population will favor Coca Cola Bottling
Company because most of the men are avoiding the intake of sugar.
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iii. POPULATION GROWTH: - The sales of coca cola products depend on
number of people available in a particular area.
iv. EDUCATIONAL LEVEL: - A population that consists of highly educated
and rich people will result in increase in demand for elite goods.
A variety of other significant demography shift have taken place throughout
the world, all of which need to be reflected in the planning process.
1. An explosion in the world population from 4.4billon in 1998 to 6.2 billion in
the year 2000. Significant opportunities will be generated as a result of this
explosion both domestically and internationally.
2. A slow down in birth rates in many of the developed nations. Many families
today, for example are, opting for just .one child and this has significant
implication for variety of companies.
3. An ageing population as advances in medical care which allows people to
live longer.
4: Changing family structure as a result of ; Later marriage, Fewer children,
increase divorce rates, More working wives, and An increase in the number
of career women
5. Higher levelof education and an increasing number of families in what has
traditionally been seen as middle class.
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6. Geographic shift in population and, the emergence of a north south divide
characterized by radically different level of; economic activity and
employment.
7. A growth in the number of people willing to commune long distance to
works, and an upsurge in the opportunities for; telecommuting whereby
people works from home and interact with colleagues via, computer
terminals.
2.3.4 NATURAL RESOURCES ENVIRONMENT
Natural resources tell us how wealthy a country is. If the major portion of its
wealth for example is from agriculture, it may include an unstable market
economically because of fluctuation in the world prices for agricultural. The same
may be true also of minerals. They are all raw materials and subject to fluctuate in
the world market and they do not provide enough employment to people. The
marketing implication is many. Firm that rely on these minerals face substantial
cost increases since they must keep searching for substitute minerals or other new
sources of supply. This is very necessary considering the fact that some of these
natural resources are either finite or non-renewable while others are infinite such as
water and air.
The deterioration of the nature environment is a major global concept. In many
cities, air and water pollution have reached dangerous levels. Most marketers need
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to be aware of the threats and opportunities associated with four trends in natural
environment, the shortage of raw materials, the increase population, level and the
charging role of governments.
2.3.5 SOCIO CULTURAL ENVIRONMENT
Culture is the man-made part of environment. People in a given culture or society
holds different beliefs and values. These beliefs and value are not of equal
importance. Those ones to which they attach more importance can be called their
core beliefs and values. In a society, the set of core beliefs and values has a high
degree of resistance. Most people for example believe in the existence of God, the
education of the children and in getting married. These beliefs are responsible for
specific attitudes behaviors found in everyday life.
Thus, core beliefs and values are passed on from generation to generation through
the parent child interactions and are reinforced by government, religious
organization and schools.
2.3.6 TECHNOLOGICAL ENVIRONMENT
The major dramatic force shaping peoples live is technology. Technology had led
to such wonder as penicillin, open-heart surgery, and birth control pill. It has
released such horrors as the hydrogen bomb, nerve gas and machine guns. It hasalso released such mixed blessing as the automobile and video games.
New technology has major long run consequences which are not always
foreseeable. The contraceptive pill for example, led to smaller families, more
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working wives and larger discretionary incomes resulting in higher expenditures
on vacation travel, durable goods and luxury items.
Technology has a tremendous effect on consumers' life styles and consumption
patterns. Technology causes consumers to shift their spending from goods which
have been on the market for a long time to newer items. For example, mere is a
considerable shift from black and white television to colored television and from
fan to air conditioning as a result of technological innovations.
To achieve the organizational goals marketer must pay attention to the following:
The accelerating paces of technological change. Toffler (1970) makes
reference to the accelerative thrust in the invention, exploitation, and
diffusion of new technologies. An ever-greater number of ideals have been
developed, and the time period between their development and
implementation is shortening.
Unlimited innovation Opportunities with major advances being made in the
area of solid-state electronics, robotics, material science and technology. Higher research and, development budgets particularly in countries such as
Japan.
A concentration of effort in the industry on minor product improvement that
is essentially defensive, rather than riskier and more offensive major product
advances.
The greater emphasis upon the regulation of technology change in order to
minimize the undesirable effects of some new product upon society.
Marketers should monitor the trends in technology, the pace of change, the
opportunities for innovation, Varying Research and Development budget and
increased regulation.
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2.4 THE EFFECT AND IMPACT OF TASK ENVIRONMENT
This consists of the actors in the company's immediate environment that affects the
company ability to serve its customers. This environment needs to be examined
because they are the microenvironment of marketing and they broadly divide into
three.
They are
i. Task environment
ii. The competitive environment
iii. The public environment
2.5 TASK ENVIRONMENT
The task environment consists of institutions, which are the company suppliers,
marketing intermediary of the company and
CHAPTER THREE
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3.0 RESEARCH METHODOLOGY
This chapter will take us through the different methods used in collecting data for
the research study. It will also present a detailed account of the materials and
methods employed for data collection of the research study. This chapter will focus
on research design such as the research method and sampling method to be used,
source of data, research instruments, details of the test conditions and the scoring
method.
3.1 RESEARCH DESIGN
Research design is the procedure that guides the investigation in the process of
collecting and analyzing the data, necessary to help identify or react to a problem
or opportunity such that the different between the cost of obtaining various level of
accuracy and expected value of the informational associated with each level of
accuracy is maximized (Tull and hawking (1987). It is the basic plan which guides
all the phases of the research project. For the purpose of this research work, survey
research method is will be used.
3.2 STUDY POPULA TION
The population of this study covers the entire Small and Medium Scale Enterprises
in Lagos State
3.3 SAMPLING TECHNIQUES AND SAMPLING SIZE
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Sampling techniques is the method of picking sample from the population, that is,
the method of selecting sample from the universe or the total population under
study, which will be used for the survey. It will be too cumbersome to work with
the entire population, so sampling techniques help to select the sample out of the
working universe. The total number of Small and Medium Enterprises to be
reached is sixty (60). Some enterpreneurers will be interviewed orally to obtain
information on positional strategy, sales figures and promotion costs.
3.4 METHOD OF DATA COLLECTION
This deals with the technique used in collecting or gathering data from different
sources of data.
SOURCES OF DATA
There are two major sources of data, and from which data were elicited for the
purpose of this research. The data for processing information in this research work
will be gotten from both primary and secondary data.
PRIMARY DATA
These are data collected for specific research or study. They are data that are newly
gathered and released by person or organization that collected them and they relate
to the problem at hand.
This research work will involve questioning a few enterpreneurers who are
considered knowledgeable enough in the matter of business environment and
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performance of small scale enterprises. All these will be carried out through
questionnaire.
SECONDARY DATA
Secondary data refers to those data that are already gathered and available. These
data are already available because they were collected for some other purpose
other than the present problem/research study.
Textbook, Journals and information from the internet on this topic which have
been collected by some experts and pasts studies will be used for this research
work to get firsthand knowledge on the research problem or study at hand.
3.5 METHOD OF DATA ANALYSES
In this research study, all data collected were analyzed effectively using the
following methods.
i. The frequency.
ii. The percentage and
iii Chi-square statistical technique for the analysis
Finally, in the analysis of the postulated hypothesis the chi-square test technique
will be employed efficiently to analyze the data collected since it is the basic
statistical procedures, which measures the extent of difference between such
variables being discussed in the research study.
The formula for calculating the chi-square is this,
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2 = (O-E)2
E
where O = Observed frequency
E = Expected frequency
REFERENCES
Allen, Peter (1973) Revised Edition Japan, McGraw Hill, Inc.
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Atoyebi O.A, Oyeniyi T (2000) Principle of Marketing 2nd Edition, New York,
Prentice Hall
Cilles G.B, (1981- 2000) Marketing 3rd Edition, H.C. Limited
John canton (1969) Mar kef ins 3rd Edition, Ejon Publishers
Heaper W.M (1'975) Operation Research. ill Edition H.C. Limited
Kotler Philip (1991) Marketing Management Analysis Planning Implementation
and control, W Edition, Eagle wood Cliff, Prentice Hall Inc.
Markin R. J. (1979) Marketing John Willey & Sons Inc.:
Onah O.J. (1980) Marketing in Nigeria. London Macmillan Press Limited.
Stantons J.W (1981) The theory of the growth of the firm Revised Edition.
Wilson R. M. & C. Gilligan Strategic Marketing Management planning,
implementation and control, 2nd Edition. Sheffield Hallam University.
Akin A.I Research Methodolosv and Project Reporting in Business Environment
Sagamu Ogun State. His Glory Prints Production.
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University of Lagos
Distance Learning Institute
Business Administration
September, 2011
Dear Respondent,
My names are RUFAI MUTIAT BOLATITO a bachelor of Science of Business
administration of University of Lagos, Akoka, Lagos.
I am conducting a research study on the topic: Effect of Nigeria business
environment on the performance of small scale industry in Nigeria.
Kindly therefore assist in completing this questionnaire.
Please, note that your response will be held in confidence and be used solely for
the purpose of this study.
Thanks for your co-operation.
Yours faithfully,
RUFAI MUTIAT BOLATITO
Researcher
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QUESTIONNAIRE
This research is a mere academic exercise geared towards improving knowledge. It
is urged that the findings and recommendations from this study will be of immense
benefit to the marketing Department of Manufacturing Organization and other
Business.
Instruction: Please tick as appropriate the most suitable option to the following
questions.
1. SEX: Male ( ) Female ( )
2. AGE: 20- 30 ( ) 31 - 40 ( ) 41 - 50 ( ) 51 and above ( )
3. EDUCATIONAL QUALIFICATION:
WASSCE/GCE/NECO ( ) ND/NCE ( )
HND/BSC ( ) MBA/PROFESSIONAL ( )
4. DEPARTMENT: Marketing ( ) Accounting ( )
Customer service ( ) Personnel ( )
5. LENGTH OF SERVICE 1-5 ( )6-10 ( )
11-20 ( ) 21 and above ( )
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SECTION B
1. Is marketing environment a major tool for the survival of your organization?
Yes ( ) No ( )
2. Do you think that marketing environmental scanning is effective in gaining
competitive advantage? Yes ( ) No ( )
3. Do you think that through marketing environmental scanning your company
has been able to create business for your products? Yes ( ) No ( )
5. Have you any effect of environmental scanning on the performance of your
company? Yes ( ) No ()
6. Do you really think that environmental scanning has effect on the
performance your company? Yes ( ) No ( )
7. Has the company noticed any positive effect of environmental scanning on
your company position in the marketplace?
Yes ( ) No ( )
8. Do you think environmental scanning has any effect on the sales volume of
your company? Yes ( ) No ( )
9. Is marketing environmental scanning necessary in the process of strategic
management and business development?
Yes ( ) No ()