Mutiat Dli Chapter 1-3 Corrected

8/4/2019 Mutiat Dli Chapter 1-3 Corrected

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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 ()

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Mutiat Dli Chapter 1-3 Corrected

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