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AN EVALUATION OF PRODUCT INNOVATION AS A STRATEGY FOR THE SURVIVAL OF MANUFACTURING FIRMS IN NIGERIA

ABSTRACT

This research work is to examine the effect of product innovation as a strategy for the survival of manufacturing firms in Nigeria, a case study of Ama Breweries (Nig) Plc Enugu. To carry out the research work Ama Breweries were uses as a sample which was drawn from zone. In the case of research useful on finding, good application were made which among other include good combination materials as the case may be and as it was recovered that it makes to help new product to look more attractive to the people made the product for. In the other hand, product innovation helps the firms to be competing on the newly available products with its competitors. It was also observed that a lot of factors contribute to the failure of the impediment to the success of product innovation which includes product labeling, packaging, branding and product positioning. Effect has been made to solve all these problem, however relevant information will be obtained from staff of Ama Breweries  industries and their distributors through questionnaire moreover, the analysis and data collection of the respondents. Finally, the summary of the findings will help the researcher to make recommendation on the best way to achieve company objectives through innovation.

CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND OF THE STUDY

Production innovation is important in any dynamic economy. It determines both the level of economic growth and standard of living of the citizens product innovation takes long to spread through the social system.

Most of the product in the market today have undergone changes overtime. Some that were in the market year ago have phased out with new product are introduced into the market on a continuous basis. When some existing company’s product enter decline stage there is need to carryout product innovation.

Furthermore, customers want new products and competitors must do their best to supply them these products. Competition has played a major role in encouraging Ama Breweries Nigeria Plc Enugu to carry out product innovation. This is because of the desire of the company to better its distinctive advantage over the competitors.

A company can add new product through acquisition and new products innovation. The acquisition route can take three forms. Ones the company can buy other companies, it can buy franchise or license from other company. In those case the company does not innovate new product but acquires the right to existing one.

However, Ama Breweries Nigeria Plc, had suffered much danger and uncertainties in product innovation. This danger are basically on the area of finance and human resource wastage without achieving success, in production of the product innovation which say that its either you innovate those basic factors not withstanding Ama Breweries Nigeria Plc recognized that they act to remain in business for considerable time.

Product innovation which is regarded as introduction of new product or modification of the existing ones either by changing the physically structure of the product or its package or the quality to meet the consumers need of Ama Breweries Nigeria Plc, Enugu and basic concern of this research work.

BRIEF HISTORY OF AMA NIGERIA PLC ENUGU

Nigeria Breweries Plc, incorporated in the 1946, is the pioneer and largest brewing company in Nigeria. Its first bottle of beer star large rolled off the bottling lines of its logos brewing in June 1949. Other Breweries were subsequently commissioned by the company, including Aba Brewery in 1963, and Ibadan brewing 1982.

In September 1993, the company acquired its fifth breweries, sited at Ameke in Enugu State. Ama Breweries is the largest breweries in Nigeria and of the most modern worldwide operation. Enugu brewing were discounted in 2004, while the company acquires a malting plant in Aba in 2008.

In October 2011 Nigeria Breweries acquired majority equally interest in Sona system  associates business management limited (Sona system) and life breweries limited from Heineken N.V this followed Heineken acquisition of controlling interest in five breweries in Nigeria.

Sona system is two breweries in Ota and Kaduna, life breweries in Onitsha have now become part of Nigerian Breweries Plc. Together with the three brand, Goldberg, Larger, Malta Gold and life routine of the Lager.

Nigeria Breweries Plc, now has eight operational breweries from which its products are distributed into all parts of Nigeria, in addition to the malting plants in Aba and Kaduna.

The company has profound of high-quality brands including Star Larger (1970) place larger, legend extra stout (1990) Abu extra stout, however larger (October 2011), Star life Larger (February 2014), pale large. Ace passion apple spark (December 2014), Alcohol free drinks.

Maltina (1997) in three variation, namely: Maltina classion, Maltina strawberry and Maltina pineapple: Maltina sip-it (200% in Tetrapala, Amstel Malta (1994), fayrouz in pear and pineapple (2006) Climax energy Malta Gold (October 2011).

Most of the products are in returnable bottles and all products are available in cans Fayrouz is also P.E.T bottles.

The company head office are located in Lagos.

1.1     STATEMENT OF THE PROBLEM

In any competitive market enough, the marketing practitioners is often faced with ordering of how to determine the nature of demand for his product in a given market segment. In view of this, a lot of problems came up to plan for product innovation which include:

    i.        Inadequate Capital: Inadequate capital has been major problem of Ama Breweries Nigeria Plc, in trying to plan product innovation, it was observed that product innovation requires a lot of capital since a lot of planning has to be made and the management of Ama Breweries Nigeria Plc was unable to provide the capital required. However, this is difficult for the company to innovate.

  ii.        Inadequate time for the planning of the product innovation is another factor that militate against the success of the company in an effect to innovate their product. However, the allocation by the management for the planning of product innovation is usually very short which makes it difficult for them to achieve the objective product innovation.

iii.        Inadequate Information on product innovation is also another factor that render product as a life wire of every organization planning activities, the organization cannot do without accurate and timely information. However, the organization may be abstained from the company customer, sales people and from the competitor’s activities. In view of this company it was unable to obtain the necessary and required information that will help toward product innovation.

1.3  PURPOSE OF THE STUDY

1.     The main primary aim of the research work is to defined certain variable usually associated with products and to enhance their effectiveness and to ensure the survival of indigenous manufacturing firms in Nigeria with Ama Breweries Nigeria Plc Enugu as case study.

2.     To inform the management of product innovation and how it constitutes as a strategy for the survival of Ama Breweries Nigeria Plc.

3.     To see how product innovation can be used as means for bearing competition.

4.     It is also important to mention that one of the objectives of the study is for Partial Fulfillment of the Award of National Diploma (ND) in this Institution.

1.4  SIGINFICANCE OF THE STUDY

This project work is conducted to inform the management of Ama Breweries Nigeria Plc about the need of the appraisal for product innovation and how it can constitute a strategy for their survival in the competitive market.

In another development, this project work will enlighten students especially student of the National Diploma (ND) in the Institution of higher learning, the need for appraisal of product innovation as a survival of firm.

1.5  RESEARCH QUESTIONS

1.     Does your product have life cycle?

2.     Why is the adequate understanding of the product life cycle important to present and future marketing managers? 

3.     What are usually responsible for the high failure rate of new products in the marketers?

4.     How can the life cycle of a product be properly managed?

1.6  SCOPE OF THE STUDY

This study covers only renewed companies within Enugu Urban Area. No outside manufacturing companies irrespective of their experience and capacity in manufacturing are stated in this study except for reference purpose.

For these renewed manufacturing companies, this study is structured to consider product strategy only. Therefore all activities were being centered on Ama Breweries Nigeria Plc.

1.7  DEFINITION OF TERMS

Following terminologies are hereby operating defined as the used in this study for a better reading and general compression of this research report.

Packaging: This is the process of putting a general product into shaped and sequential view to make it more attractive and easily portable.

Product: Product is anything that can be offered to a market for attention acquisition or consumption. It includes physical objects (e.g. car).

Industry: Industry according to Oxford Dictionary (1996:411) is the whole firms dealing in the same kind of product.

Target market: This is the most viable and attractive segment of the market wants to offer satisfaction through his or her product.

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