The Importance of Distribution Channels Specifically for Visakhapatnam Steel Plant - Research Proposal Example

Research Topic One of the main objectives of marketing is making available material in right form at right place. The distribution is contributed large in this area. So channel decisions refers to the managerial decisions on the selection of best routes or paths for moving goods from the produce to the consumer Channels of distribution are concerned not only with the physical movement of goods but also with the production selling and marketing control. The term channels of distribution are used to refer to the various intermediates that help in moving the products from the producer to the consumer. There are a variety of middlemen and merchants those acts as intermediates between the producers and consumers. Channels of distribution are the most powerful element among marketing mix elements. Many products, which were sound, died in their infancy because they never found the right road to the market. On the other hand by developing a sound distribution network and launching aggressive advertisement campaigns a company can carve out a rich for itself. A number of utilities are created by prompt ad efficient performance of the function of physical distribution channels of the function of physical distribution channels of distribution help movement of goods from one place to another and thus create place utility. They make it possible for the consumer to get the goods when he wants them and thus create time utility. They made it possible for the consumer the obtain goods at a price he is willing to pay and under conditions which being him satisfaction and pride of ownership and thus create possession utility. In this paper we will undertake an analysis of the effectiveness of distribution channels. Aim The aim of this research is to examine the importance of distribution channels specifically for VISAKAPATNAM STEEL PLANT. Objectives To review the literature about this issue up till now. To improve the awareness regarding the importance of distribution channels in marketing. Examine that companies adequately use the distribution channels in order to undertake. Literature review In order to understand the importance of distribution channels it is important to have knowledge what is a distribution channel? According to a definition given at About.com a distribution channel is defined as “An organised network of agencies and institutions which in combination perform all the functions required to link producers with end customers to accomplish the marketing task.” (About.com, 2008) A Marketing Channel Performs the work of moving goods from producers to customers distribution channel plays a very important role in achieving the marketing objectives of a company with the help of distribution channels. 1. Channels provide distributional efficiency to manufacturers. 2. Channel to supply products in required assortment. 3. Channels provide salesmanship. 4. Channels help implement the price merchandise the product. 5. Channels help implement the price mechanism. 6. Channels look after physical distribution and financing functions 7. Channels act as change agents generate demand. Manufacturers have many alternatives for reaching a market. They can sell direct or use one, two, or three level channels. Deciding which type of channel to use calls for analysing customer needs, establishing channel objectives, and identifying and evaluating the major alternatives, including the types and numbers of intermediaries involved in the channel. Including the types and numbers of intermediaries involved in the channel. The company must determine whether to distribute its product exclusively, selectively, or intensively, and it must clearly spell out the terms and responsibilities of each channel member. Effective channel management calls for selecting intermediaries and training and motivating them. The goal is to build a long-term partnership that will be profitable for all channel members. Individual members must be periodically evaluated against pre established standards. Channel arrangements may need to be modified when market conditions change. Marketing channels are characterised by continuous and sometimes dramatic change. Three of the most important trends are the growth of vertical marketing systems, horizontal marketing systems, and multi-channel marketing systems. All marketing channels have the potential for conflict and competition resulting from such sources as goal incompatibility, poorly defined roles and rights, perceptual differences, and interdependent relationships. Companies can manage conflict by striving for superordinate goals, exchanging people among two or more channel levels, co-opting the support of leaders in different parts of the channel, and encouraging joint membership in and between trade associations. Channel arrangements are up to the company, but there are certain legal and ethical issues to be considered with regard to practices such as exclusive dealing or territories, tying agreements, and dealers’ rights. (Kotler, 2000) Methodology Philosophy Research is a fact finding activity (Dominowski, 1980). The aim of primary research is to make known something previously unknown to human beings and to advance human knowledge by making it more certain or better fitting; the aim is discovery (Elias, 1986). Kerlinger (1970) uses more technical language to define it as the systematic, controlled, empirical and critical investigation of hypothetical propositions about presumed relations among natural phenomena. The research philosophy depends on the way we think about the development of knowledge and this thinking affects the way we do search (Saunders 2000). Whilst undertaking the research, a clear understanding of research philosophy is essential. Easterby-Smith et al (1997) identify three reasons why the exploration of philosophy may be significant with particular reference to research methodology: Firstly, it can help the researcher to refine and specify the research methods to be used in a study, that is, to clarify the overall research strategy to be used. This would include the type of evidence gathered and its origin, the way in which such evidence is interpreted, and how it helps to answer the research questions posed. Secondly, knowledge of research philosophy will enable and assist the researcher to evaluate different methodologies and methods and avoid inappropriate use and unnecessary work by identifying the limitations of particular approaches at an early stage. Thirdly, it may help the researcher to be creative and innovative in either selection or adaptation of methods that were previously outside his or her experience. Two views about the research process dominate the literature: positivism and phenomenology which have an important part to play in business and management research (Saunders, 2000). Positivism is founded on the belief that study of human behaviour should be conducted in the same way that as studies conducted in the natural sciences. On the other hand phenomenology is concerned with the understanding human behaviour from the participant’s own frame of reference (Hussey and Collis, 2003). Positivistic paradigm Phenomenological paradigm Tends to produce quantitative data Tends to produce qualitative data Uses large samples Uses small samples Concerned with hypothesis testing Concerned with generating theories Data is highly specific and precise Data is rich and subjective The location is artificial The location is natural Reliability is high Reliability is low Validity is low Validity is high Generalises from sample to population Generalises from one setting to another Figure 1: Features of the two main paradigms (Hussey and Collis, 2003) As the research philosophy depends fundamentally on the research question (Saunders 2000), the phenomenological philosophy has been chosen in this paper. This choice originates from that researcher’s topic/question that aimed to investigate how sufficient is information provided in annual reports for shareholders in order to make their investing decision. In this specific research, -related to the question- the author will collect data and develop a theory as a result of data analyses rather than developing a theory and test it afterwards. Qualitative versus Quantitative primary research TECHNIQUES Qualitative techniques stand in contrast to quantitative techniques, the main difference being that quantitative techniques involve numerical data whereas qualitative techniques involve more abstract information. Data collected using qualitative techniques do not generally lend themselves to statistical analysis whereas quantitative techniques do (Veal, 1997). A mixed methodological approach will be used in this research, because mixing methods enables the insufficiencies of both qualitative and quantitative methodologies research design to be overcome and can assist with data collection and data analysis (Jennings, 2001). According to my total survey I had find out different type of dealers and wholesalers opinions. In that most of the dealers and wholesalers expresses that there is no proper supply of the products and assistance and discounts were not providing properly. The sample size will be 150. Interviews will be conducted in coastal districts of Andhra Pradesh only. The primary data will be collected with the help of the questionnaire designed and developed for their purpose. Secondary data will be collected from previous records and company booklets. The sampling methods used will Non-probability and in the convenience sampling will be selected. The analysis and interpretation will consist of percentage method and chi-square test. Section 6: Timetable of Activity: Gantt Chart: Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Proposal accepted References About.com, (2008). Definition: Marketing Channels, available at http://marketing.about.com/od/marketingglossary/g/channeldistdef.htm Dominowski, R, L, 1980. Research Methods. Prentice-Hall Easterby-Smith M., Thorpe R. & Lowe A., 1997, Management Research: an Introduction, London, Sage Publications. Elias, R. (1986). The politics of victimization: Victims, victimology and human rights. New York: Oxford University Press. Hussey R., Collis J., Business Research, 2nd Ed. 2003, Palgrave Macmillan Jennings, N. R., (2001). An agent-based approach for building complex software systems. Communications of the ACM, 44 (4) 35–41. Kotler, P., (2000). Marketing Management, Millenium Edition, Prentice Hall. Kerlinger, F, N, 1970. Foundations of behavioural research. New York: Holt, Rinehart and Winston. Saunders M, Lewis P, & Thornhill A, 2000., Research Methods for Business Students, 2nd Ed. Pearson Education Limited. Veal, A, J, 1997. Research Methods for Leisure and Tourism: A Practical Guide. Chatham, Kent, Pearson Education Limited. Read More