CHAPTER ONE

BACKGROUND TO THE STUDY

1.1   INTRODUCTION

1.2

1.3 Statement of the Problem

         In a bid to house a competitive edge over another in the fast food industry, competitors applying different marketing strategies to win the marketing battle. Some develop their strategy by reducing the prices to have a greater share of the market while others develop their strategies on product quality and this has resulted into great problem facing the sector.

In the same vein, different government lines, federal, state and local government of the industry has significantly affected their operations and the burden of high taxes/levies on the operators falls back on the consumer who pay higher prices for the fast food consumers.

Furthermore, the rising cost of condiments in the preparation of fast food has a negative impact on the consumer who ahs to pay high prices in order to consume fast food.

In addition, rising cost of acquiring accommodation to start a fast food business ahs significantly affected the operators of this industry as increasing cost of accommodation are been paid for indirectly by the consumer of fast food. Finally, the huge financial resources expand on promotional activity of fast food has contributed to increase their cost of operation.

This study hopes to offer meaningful solution to these problem in later chapters. This is the essence of research report.

1.4 Aims and Objectives

         The aim and objective of this study is to measure the extent to which advertising has influenced in the consumption of fast food. The following are the aims and objectives of the study.

     1.         To examine the service offered by fast food business operators.

     2.         To know the promotional tools or techniques adopted by the sector under study.

     3.         The effect of advertising on the consumption of fast food.

     4.         The factor(s) that influence customer to a choice of a particular shop.

     5.         To ascertain the effect of advertising on company’s sale volume.

1.5   Research Questions.

          In order to provide a direction for this study, the following research questions have been formulated.

     i.         What service do fast food operators offer?

  ii.         What promotional mix element do fast food firms use?

1. What is the relationstihip between the sale promotional mix element used and the expected sales volume?

 iv.         What is the relationship between the quality of services offered by fast food business operators and sales volume?

At the end of this work, possible answer must have been found for this. This is the essence of this research work.

1.6   Research Hypothesis

          For the purpose of this study, the following hypothesis has been formulated. Hence these sets of null and alternative hypothesis have been put up by the researcher in order to lest their validity or otherwise.

   1.         HO:   Advertising does not help in informing and persuading consumers to purchase fast food product.

HI:    Advertising helps in persuading and informing customers to purchase fast food product.

   2.         HO:   Advertising does not help to increase sales volume and profitability of fast food product.

HI:    Advertising helps to increase sales volume and profitability of fast food product.

   3.         HO:   There is no relationship between advertising expenditure and Mr. Biggs net profit.

HI:    There is a relationship between advertising expenditure and Mr. Biggs net profit.

1.7   Scope of the Study

The scope of this research work is limited to Mr. Biggs fast food product and its activities. For clarity purpose, this research study covers the following:

The relationship between the role of advertising on consumption of fast food and profitability of Mr. Biggs. This includes the relationship as could be observed right fromthe inception of the business.

The role of advertising plays on the consumption of fast food and net profit of the organization.

The study also covers such area as the role of advertising on other competing fast food businesses.

Finally, the research work is limited to sample opinion of the staff of Mr. Biggs of Asaba, the dealers and consumers in Asaba metropolis.