An Appraisal of Vertical Marketing System of Medical Drugs Distribution in Abia State, Nigeria

Abstract

The study attempts to assess the channel performance of the vertical marketing system of drugs distribution in Abia State of Nigeria and the extent channel members’ satisfaction with the channel linkage can facilitate co-operation among members. Two research questions were raised to guide the study. Two hypotheses were formulated for testing. A sample of 300 respondents, comprising 30 licensed drug manufacturers/ importers, 49 wholesalers, 74 Retailers, and 147 Customers was selected from a population of 1200 respondents. Questionnaires were administered and completely retrieved. Interviews were held with some licensed distribution channel members. Data were analyzed using Z-test at 0.05 level of significance and 4 degrees of freedom. Findings revealed low performance of the vertical marketing system of drugs distribution and the statistical insignificance of the channel members’ satisfaction with the channel linkage in relation to facilitating co-operation among members. The manufactuturers should provide assistance to other channel members in training / retraining of personnel to enable them understand the total channel concept. They should extend credits provisions to other channel members while the wealthy distributors should make substantial financial deposits available to manufacturers to enable them attain economies of scale in production. These recommendations, among others, would enhance channel performance, improve channel members’ satisfaction with the channel linkage and induce the cooperation of members.

Keywords:  Vertical Marketing System, Channel Performance, Channel Members’ Satisfaction, Dysfunctional Conflict, Metrics and Brand Equity.