NET MARGIN AND EFFICIENCY AMONG BEEF AND CHICKEN SELLERS IN NJIKOKA L.G.A OF ANAMBRA STATE

CHAPTER ONE

INTRODUCTION

1.1 Background to the study

Nigeria is the largest livestock producer and trader in Central and West Africa, with over 16 million head of cattle and birds, much exceeding the populations of Niger, and Chad (Bernard et al., 2010). However, more current data indicates that there are 19.5 million heads of cattle and birds (FAOSTAT, 2017). Prior to recently, the majority of Nigeria's livestock production took place in rural areas, but advancement in husbandry and breeding for betterment has since gained significance.

Beef and chicken are highly valued as sources of protein in the diets of the majority of Nigerians, and their general acceptance for human consumption among the country's many ethnic groups makes them a viable solution to the country's pervasive protein deficiency problem (Bobola et al., 2015). Given the current state of technology, marketing and selling of beef and poultry has been demonstrated to be inefficient among sellers, indicating that there is still significant room for enhanced efficiency (Nwigwe et al., 2016).

Nigeria's inadequate protein supply is a problem brought on by the growing demand and supply imbalance for livestock products. Nigerians consume less than 9g of animal protein per person day, compared to about 50g per day in North America and Europe (Boland et al., 2013).

This is because the livestock sector is unable to meet the nation's demand for animal goods, which results in a massive loss of foreign exchange when livestock products are imported to close the supply-demand imbalance. The marketing of beef and chicken has received a lot of study interest.There are few details about the underlying causes of the size of the profits gained from selling beef and chicken especially in Anambra state.

Selling beef and chicken is a commercial activity that involves getting these items to consumers in both urban and rural regions (Omoruyi, et al. 2010). In any economic system, selling or promoting these things serves a variety of roles. One of the functions is to connect buyers and sellers, enabling exchange relationships and raising living standards which the aim of making net margin or profits.

Due to the distance between the producing areas and the main consumer markets, there are several intermediaries and stakeholders in the marketing chain, which results in a poor profit or low net margin for the sellers this as a result of cost of production.

This has resulted in higher transaction expenses, which would eventually raise the final retail price of chicken and beef. The poor, who often consume diets low in animal proteins, could become unable to get chicken and beef and its products due to the actions of intermediaries and stakeholderswhich has negatively impacted the profit (Mafimisebi, 2011).There are numerous intermediates and players in the marketing chain as a result of the fact that beef and poultry are mostly produced in northern part of Nigeria and consumed in the south (Adamu et al., 2005).

More concerning is the claim that the nation's national meat and chicken supply situation is serious and deteriorating, with beef and chicken alone making up around 70% of the overall national meat supply (Omoruyi et al., 2010). This has make it important to examine The relationship between net margin and efficiency among Beef and Chicken Sellers inNjikoka L.G.A Of Anambra State, Nigeria.

1.2 Statement of the Problem

There is a lack of regard to change the current trend of beef and chicken production and marketing, despite the multiple benefits that beef and chicken have for the socioeconomic well-being of the inhabitants of Njikoka and the country at large.There is further a lack of effective and efficient price determining mechanism in marketing of chicken and beef in Anambra, which has led to the negative impact on net profit margin of its sellers. Hence, this is demonstrated by the lack of standardized grading systems, weighing systems, and marketing strategies that will guarantee the pleasure of both producers and customers while selling and purchasing beef and poultry.There is also a dearth of market information about chicken and beef sellers. Therefore, it is based on this backdrop that the present study examine on net margin and efficiency among Beef and Chicken Sellers in Njikoka L.G.A Of Anambra State, Nigeria.

1.3 Objectives of the Study

The objective of the study is to examine net margin and efficiency among Beef and Chicken Sellers in Njikoka L.G.A Of Anambra State. Other specific objectives include:

1). To examine the impact of net profit margin on efficiency among chicken and beef sellers in Njikoka Local government Area.

2). To outline the determinants that influence net profit margin and efficiency among chicken and beef sellers in NjikokaLocal government Area.

3). To outline the problems experienced by beef and chicken sellers in the marketing of chicken and beef towards profitability in NjikokaLocal government Area.

4). To suggest modern methods of marketing of beef and chicken among traders in Njikoka Local government area that will ensure a better market system.

1.4 Research Questions

1) What is the impact of net profit margin on efficiency among chicken and beef sellers in NjikokaLocal government Area?

2) What are the determinants that influence net profit margin and efficiency among chicken and beef sellers in NjikokaLocal government Area?

3) What are the problems experienced by beef and chicken sellers in the marketing of chicken and beef towards profitability in NjikokaLocal government Area?

4)What are the modern methods of marketing of beef and chicken among traders in Njikoka that will ensure a better market system?

1.5 Hypothesis

HO: There is no significant impact of net margin on efficiency among chicken and beef sellers in Njikoka L.G.A

H1:There is a significant impact of net  margin on efficiency among chicken and beef sellers in Njikoka L.G.A

1.6 Significance of Study

This study would enable the researcher to pass their experience on the subject matter to

Small business: This research will benefit small business in the area of decision making and marketing of beef and chicken products in other to maximize profit

Government Ministries: This study will help the government in advising them the suitable programs to make towards small business in who are into beef and chicken businesses other to encourage it.

 Schools and students: This will serve as a medium for further research.

1.7 Scope of The Study 

The study would cover net margin and Efficiency among Beef and Chicken Sellers inNjikoka L.G.A Of Anambra State.

1.8 Limitation of the Study

The researcher was faced with the following constraints in carrying out this study:

Time: The time within the researcher is too short to carry on the detail study on this topic.

Resources: Another constraint of the researcher is financial resources to carry on the detail study of this topic.
Data: Another limitation to this study will be lack of data to make valid study on the research problem.

1.9 Operational Definition of Key Terms

Net Margin:The net profit margin, or simply net margin, measures how much net income or profit is generated as a percentage of revenue. It is the ratio of net profits to revenues for a company or business segment

Efficiency:Efficiency is the often measurable ability to avoid wasting materials, energy, efforts, money, and time in doing something or in producing a desired result. In a more general sense, it is the ability to do things well, successfully, and without waste.

Profitability:Profitability is closely related to profit – but with one key difference. While profit is an absolute amount, profitability is a relative one. It is the metric used to determine the scope of a company's profit in relation to the size of the business. Profitability is a measurement of efficiency – and ultimately its success or failure. A further definition of profitability is a business's ability to produce a return on an investment based on its resources in comparison with an alternative investment. Although a company can realize a profit, this does not necessarily mean that the company is profitable.