CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

The secret of economic prosperity of any developing country is to reduce excessive importation of consumer goods and protect its infant industries by creating market for its local products. Nigeria has a big market for any product manufactured within her territory like plastic, shoes, clothes, tiles, beverages and so on. Such products that are manufactured locally are referred to as “Made-in-Nigeria goods”. However, a new strategy should be devised on these locally made goods on meeting consumers’ taste in order to discourage demand for foreign goods. This will in no measure increase standard of living of people struggling for the means of livelihood (Alego, 1992). 

The wind of industrial evolution blowing throughout the world has created stiff competition and varieties for consumer goods. This has changed consumers’ perception on buying decision and forced them to spend a greater part of their income in ways markedly different from what took place in the past. Consumers want the advantages of affluence and the latest services that technology and business can offer (Achumba, 1998). 

The comparative advantage of foreign goods has been a challenge to manufacturers of locally made goods who peradventure have to compete with imported ones in the market might have to devise strategies to maintain a competitive advantage, in order to remain in the market. The important role of marketing in determining the success or otherwise of any organization cannot be over-emphasized notwithstanding the size of such an organization. The local manufacturers can replicate the giant stride recorded by foreign manufactured goods by establishing aggressive marketing campaign to drive out foreign goods competition in the country (Mbagwu, 1993). 

The increasing number of imported goods create stiff competition and dwindling consumer purchasing power, increasing awareness on the part of the consumers and a renewed emphasis by the consumers on the need to have values for their money have made new initiatives imperative in the Nigerian market to be a dumping site for all sort of foreign goods (Kotler, 1984). 

Product differentiation has however posed another challenge to manufacturer of locally made good in terms of price and quality, customer needs and company capabilities, interest in a competitive context since these factors converge to form the customers’ definition of value. Opportunities equally abound to compare the locally made goods with some imported ones available in the market (smuggled or otherwise) which are meant to satisfy similar purposes (Akingbola, 1999 & Oladele, 2006). 

Entrepreneurs may also be confronted with risks that may be social, political, economic or natural in the process of satisfying consumer needs. For bearing these risks, they legitimize their claim to both short-term and long-run profitability. Entrepreneurs look forward to government to provide a stable business environment that would minimize all the aforementioned risk factors. In recent past however, business enterprises in Nigeria have been facing turbulent environment that make marketing difficult, the end result being that most viable enterprises were either forced to wind while others are weakened as to warrant a great managerial ingenuity to reverse their gloomy state (Bilkey and Nes, 1982). 

Over the years, the country has been plagued with large scale under utilization of production capacity, erratic power supply that cannot be used for any meaningful planning purposes and a whole economy that cannot be forecasted. These can be attributed to lack of good management and leadership in the country as well as lack of vision and foresight. Since independence in 1960, a lot of changes had taken place in the country economically, politically and socially resulting in small and large firms going down the drain. Nigerian Government a bid to stem the tide of foreign domination of the nation’s economy, legislated Nigerian Enterprises Promotion Decree in 1994 in order to encourage favourable attitudes towards made-in-Nigeria goods. The rationale behind this policy was to reduce foreign dominance on the economy, encourage local retention of profits, and create employment opportunities amidst other objectives. (Akeredolu – Ale, 1975; Asaolu, Oladoyin and Oladele, 2005). It is against this background the study intends to examine critically factors that determine preference of foreign goods over made-in-Nigerian goods.

1.2 Statement of the Problem

Nigerian manufacturing sector is bedeviled by powerful forces, which have been threatening its existence. There is no gainsaying the fact that most of Nigerian manufacturing industries may close shop in the next decade if urgent step are not taken to reverse the visible progressive decline, in absolute and relative terms of the manufacturing mix (Sobowale, 1997). 

Nigerian’s continuous trade liberalization and increasing globalization of world trade has encouraged dumping of foreign goods in the country thereby causing stiff competition and difficulty for the marketing of home-made goods. This has forced Nigerian manufacturers to be enmeshed in a dilemma, borne out of ensuring long-term survival in an atmosphere of ever increasing product cost, and ever-decreasing consumer purchasing power (Akomolede and Oladele, 2008). 

  Moreover, the Nigerian consumer have developed a taste for foreign goods, visiting the market places one will notice how consumers regard foreign products as having a better quality than made-in-Nigerian goods. With the trade liberalization policy, the country has experienced unrestrained imports of all kinds of foreign goods. This has led to a very strong competition by both foreign and made-in-Nigerian goods, each seeking to gain a higher patronage from the Nigerian consumer.

The study is however poised to find answers to:

• How attitude of Nigerian affect Made-in-Nigeria goods?

• How the product quality affects consumers’ preference for foreign goods?

• What challenges confronting made-in-Nigerian goods?

• How the current and past trends of consumers’ attitude towards made-in-Nigeria goods.

1.3 Objective of the Study

The study is primarily concerned with attitude of Nigerians towards home and foreign goods. Specifically, the study intends to:

i. Investigate the attitudes affecting Nigerians towards made-in-Nigerian goods.

ii. Investigate significant relationship between products’ quality and consumers’ preference

iii. Examine challenges confronting marketing of made-in-Nigerian goods.

iv. Examine significant difference between the current and past trends of consumers’ attitude towards made-in-Nigeria goods.

1.4 Research Questions

i. Are there negative attitudes affecting Nigerians towards made-in- Nigeria goods?

ii. Is there any significant relationship between products’ quality and consumers’ preference?

iii. What are the challenges invo