Effects of globalization on the development of domestic manufacturing industries in nigeria (a study of dangote flour mill plc)

Project Abstract

Globalization has significantly impacted the development of domestic manufacturing industries in Nigeria, with companies like Dangote Flour Mill Plc being a focal point for studying these effects. This research project aims to analyze the specific ways in which globalization has influenced the operations and growth of Dangote Flour Mill Plc and by extension, the broader Nigerian manufacturing sector. The study will employ a mixed-methods approach, combining both quantitative and qualitative data collection methods to provide a comprehensive analysis. The quantitative aspect of the research will involve analyzing financial data, production output, and market performance metrics of Dangote Flour Mill Plc over a specific period. This analysis will help in understanding how globalization has affected the company's financial standing, production efficiency, and market competitiveness. On the other hand, the qualitative component will focus on interviews and surveys with key stakeholders such as company management, employees, government officials, and industry experts. These qualitative insights will provide a deeper understanding of the non-financial impacts of globalization on the company and the sector. The research project will also examine the regulatory environment in which Dangote Flour Mill Plc operates, considering how globalization has influenced trade policies, market access, and competition regulations in Nigeria. Understanding these regulatory dynamics is crucial for assessing the opportunities and challenges that globalization presents for domestic manufacturing industries in the country. By focusing on Dangote Flour Mill Plc as a case study, this research will shed light on the broader implications of globalization on the Nigerian economy and industrial development. Overall, this study seeks to contribute to the existing body of knowledge on the effects of globalization on domestic manufacturing industries in developing countries like Nigeria. By providing a detailed analysis of the case of Dangote Flour Mill Plc, the research aims to offer insights that can inform policy decisions, business strategies, and future research directions in the context of globalization and industrial development.

Project Overview

<p> </p><div><b><p><b>INTRODUCTION</b></p><p><b></b></p><b><p>1.1 &nbsp; &nbsp;<b>BACKGROUND TO THE STUDY</b></p><p><b></b></p><b><p>Globalization could simply be described as the<br>integration of national economies through trade investment and financial<br>interaction. The concept of globalization began to thrive shortly after the end<br>of Second World War when the allies led by the united State decided to support<br>a world wide opentrading and investment system. The collapse of the Soviet Union,the<br>fall of the Berlin wall and anti-climatic end of the cold war aided the<br>emergence of the ascendancy of the globalization trend. This resulted in the<br>hurried marketizationand democratization of the former soviet states of Eastern<br>Europe and selective absorption into mainstream western Alliance system of the<br>hitherto to communist States. Beyond this however, globalization aided by<br>supersonic transformation in information technology integrated the world<br>through pushof free market economy as well as liberal democracy. (Olaleye,<br>2002).</p><p>Globalization has increased the volume of trade by the<br>developing nations in general and that of Nigeria in particular. The continuous<br>growth in. imports and exports is seen as evidence that countries are becoming<br>independent on global markets.</p><p>Globalization has also brought about revelation, in<br>technology. In fact one of the propelling agents is technology. There have been<br>developments of new and improved method of doing traditional things otherwise<br>called technological progress. The Banking sector more than any other sector is<br>the hardest hit (Olajide, 2002).</p><p><b>1.2 &nbsp; STATEMENT OF THE PROBLEM</b></p><p><b></b></p><b><p>There is wide spread of trade around the globe thereby<br>increasing the level of competition in the manufacturing industry globally. The<br>domestic manufacturing industry in Nigeria is faced with the problem of<br>competing with the developed countries who through globalization continue to<br>improve and advance on daily basis in innovationand in information technology.<br>The technological environments are moving at supersonic speed, Computers,<br>Telephones, Televisions and wireless forms of communication now are merging<br>into telecommunication both to create multimedia products and allow individuals<br>in the developed world to communicate with others, hereby improving manpower<br>skills, improving in method of production, efficiency and effectiveness of<br>business organization. Globalization has helped these developed countries to<br>achieve quality, quantity, price, durability, manpower skill, and etc. If the<br>domestic manufacturing industries fails to heed the lessons of globalization it<br>will be gradually whipped into line by the forces unleashed by globalization.</p><p>Therefore, it is upon this premise that a study of this<br>nature is necessary in order to identify the effect of all afore mentioned<br>factors on the development of domestic manufacturing industries in order for<br>them to be able to compete globally.</p><p>1.3 &nbsp; &nbsp;<b>OBJECTIVES OF THE STUDY</b></p><p><b></b></p><b><p>The main objective of this study is to examine the effect<br>of globalization on the development of domestic<br>manufacturingindustry with Dangote Flour Mills PLC as a focus. This, in order<br>to achieve the above objectives, the following specific objectives will be our<br>guide.</p><p>1. &nbsp; &nbsp; &nbsp; To examine whether the development of<br>domestic manufacturing industries have effect on prices of goods and services?</p><p>2. &nbsp; &nbsp; &nbsp; To examine whether increase in the level<br>of competition with globalization have effect on prices of goods and service?</p><p>3. &nbsp; &nbsp; &nbsp; To examine whether organization output’<br>in, domestic manufacturing industry affect price?</p><p>4. &nbsp; &nbsp; &nbsp; To examine whether quality plays a role<br>in the acceptability of goods and services of domestic manufacturing companies<br>globally?</p><p>1.4 &nbsp; &nbsp;<b>RESEARCH QUESTIONS</b></p><p><b></b></p><b><p>In order to achieve the objectives of this study, the<br>following are the research questions:</p><p>1. &nbsp; &nbsp; &nbsp; Does the development of domestic<br>manufacturing industries have effect on prices of goods and services?</p><p>2. &nbsp; &nbsp; &nbsp; Does increase in the level of competition<br>with globalization have effect on prices of goods and service?</p><p>3. &nbsp; &nbsp; &nbsp; To what extent does organization output<br>in domestic manufacturing industry affect price?</p><p>4. &nbsp; &nbsp; &nbsp; To what extent does quality plays in the<br>acceptability of goods and services of the domestic manufacturing companies<br>globally?</p><p>1.5 &nbsp; &nbsp;<b>RESEARCH HYPOTHESES</b></p><p><b></b></p><b><p>To provide, answers to the research-questions the<br>following hypotheses will be tested.</p><p>1. &nbsp; &nbsp; &nbsp; Globalization has impact on the<br>performance of domestic manufacturing industries in Nigeria.</p><p>2. &nbsp; &nbsp; &nbsp; The development of domestic manufacturing<br>industries has effect on prices of goods andservices.</p><p>1.6 &nbsp; &nbsp;<b>SIGNIFICANCE OF THE STUDY</b></p><p><b></b></p><b><p>A study of this kind is expected to make theoretical and<br>practical contributions to manufacturing companies in Nigeria. Thus, Nigeria is<br>the most populous black nation in the world and the effect of globalization on<br>the country could be generalized for other countries in the sub-Sahara Africa,<br>so the effect of globalization process on Nigeria has a determinant effect on<br>other countries in Africa.</p><p>Also, it is hoped that this stud’ will provide<br>manufacturing companies an incite on how organizations, can cope in the<br>ever-changing, turbulent business environment in developing countries and how<br>organization activities can be organized in order to cope effectively with<br>opportunities and trend in the business environment.</p><p>Also, how to overcome industrial or economic recession<br>changes in social variables increase competition and technological advancement.<br>In addition, it is hoped that this study will help the policy makers to see<br>need to invest more in technology in a nation like Nigeria that encourages<br>small and medium enterprises scale (SMEs).</p><p>This study is also expected to prove to scholars and<br>imminent researchers, that it is possible to manufacture quality product in a<br>developing nation like Nigeria with Globalization.</p><p>Furthermore, for Business administration student who<br>aspires to become Managers manufacturing industries, itis expected that this study win expose them on how products can<br>be advertised and distributed in the global village without stress and with<br>less cost, thanks to globalization</p><p><b>1.7 &nbsp; SCOPE AND LIMITATIONS OF THE<br>STUDY</b></p><p><b></b></p><b><p>The basic premise on which this study is based is the<br>effect of globalization on the development of domestic manufacturing industries<br>in Nigeria with DangoteFlour Mills Plc as a case<br>study. The study covers representative numbers of the generality of the workers<br>in the organization. No special consolidation is given to sex, age and<br>Nationality in collecting data from the respondents.</p><p>The first set-back encountered in the course of carrying<br>out this research is the time limitation. The Nigeria academic environment has<br>been largely infected by irregularities and uncertainties and as such abnormal<br>academic calendar.</p><p>Another key limitation was that of finance. Since I do<br>not have a computer system. of my own I haveto pay to get the research work<br>typed out. Furthermore the fear of insincere response on the part of the<br>respondents even when a questionnaire is administered on them.</p><p><b>1.8 &nbsp; DEFINITION OF BASIC TERMS</b></p><p><b></b></p><b><p><b>Globalization:</b>&nbsp;Globalization could simply be described as the<br>integration of national economies through trade investment and financial<br>interaction</p><p><b>Manufacturing<br>Industries:</b>&nbsp;A<br>manufacturingindustry is an industry where goods are produced and they prepare<br>what is known as manufacturing account. A manufacturing account is basically a<br>list of cost relating to the production of goods (i.e. factory relation<br>expenses).</p></b></b></b></b></b></b></b></b></b></b></div><b><b><p><b>Development</b>: Is a process of improving the economy of a country by<br>increasing the amount ofbusiness activities.</p><p><b>Technology<br>Development</b>: It is a process<br>of using advanced scientific mechanism in an industry to improve it<br>productivity.</p><p><b>Manpower</b>: All the people who are available to do a particular job<br>or to work in a particular place.</p><p><b>Management:</b>&nbsp;Is the art and science of getting done through other<br>people using both human and non-human resources.</p><p><b>Performance:</b>&nbsp;The degree of efficiency and effectiveness with which<br>organizational objectives are achieved. Thus efficiency and effectiveness are<br>the determinants of performance in the study.</p><p><b>Strategy:</b>&nbsp;The unified comprehensive plan that the enterprise<br>develops to achieve its objective.</p><p><b>Enterprises</b>: This is any commercial undertake that is either<br>publicly owned orcontrolled. The word is<br>used interchangeably with organization in this study.</p><p><b>Company:</b>&nbsp;Is an association of a number of person carrying on<br>business for the purpose of a monetary gain, although there are other companies<br>that are deliberately non-profit making.</p><p><b>Business<br>Environment:</b>&nbsp;This is the sum<br>total of the physical and potentially relevant to the organization goals<br>setting and goal attainment which are taken directly into consideration by<br>members of the organization when making business decision and plans.</p><p><b>1.9 &nbsp; HISTORICAL BACKGROUND OF THE<br>CASE STUDY:</b></p><p><b></b></p><b><p>Dangote Flour Mills Plc commenced operations in 1999, as<br>a division of Dangote industries limited. One of Nigeria’s largest and fastest<br>growing conglomerates. Following the strategic decision of DIL unbundled its<br>various operation, Dangote flour Mills Plc was incorporated in January, 2006.<br>The restructuring was completed in January, 2006 when the federal High court<br>sanctioned a scheme of arrangement where in all the assets, liabilities and undertakings<br>of the erstwhile Flour division of OIL were transferred to Dangote Flour Mills<br>Plc. From an initial installed capacity of 500 MT per day at its Apapa mill, Dangote<br>flour has expanded rapidly by opening in quick successions, Three other flour<br>mills in Kano (2000), Calabar (2001) and installed capacity of 5000 MT per day<br>but three of them were subsequently expanded<br>resulting in a total installed capacity 5000MT per day distributed as follows:</p><p>Apapa &nbsp; &nbsp; &nbsp; – &nbsp; &nbsp; &nbsp; 1000 MT per day</p><p>Kano &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; – &nbsp; &nbsp; &nbsp; 1500 MT per day</p><p>Calabar &nbsp; &nbsp; &nbsp; – &nbsp; &nbsp; &nbsp; 1000 Mt per day</p><p>Ilorin &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; – &nbsp; &nbsp; &nbsp; 500<br>MT per day</p><p>These expansions were in response to a growing national<br>demand for the flour and flour based products in<br>addition to the company’s drive for increased market share. Thus from a<br>modest beginning, the company has grown to become one of the industry leaders<br>within a six year period.</p><p>The company has 2 wholly owned subsidiaries, namely</p><p>i. &nbsp; &nbsp; &nbsp; Dangote<br>Agro sacks limited</p><p>ii. &nbsp; &nbsp; &nbsp; Dangote<br>paste Limited</p><p>In line with DIL’s business philosophy of establishing a<br>document presence in any sector it operate in these subsidiaries occupy<br>leadership position in their respective industries.</p><p><b>BUSINESS:</b></p><p><b></b></p><b><p>The company is in the business of flour milling,<br>processing and marketing of branded flour its product portfolio comprises of<br>the following:</p><p>i. &nbsp; &nbsp; &nbsp; Bread<br>flour</p><p>ii. &nbsp; &nbsp; &nbsp; Pasta<br>semolina and</p><p>iii. &nbsp; &nbsp; Wheat<br>offal’s (bran’s)</p><p><b>FLOUR MILLING<br>TECHNOLOGY AND PROCESS</b></p><p><b></b></p><b><p>Technology</p><p>In order to transform wheat into high quality flour the<br>deployment of state of art plant and equipment as well as technical expertise is critical DFM’s mills across the country<br>equipped with the latest flour milling technology available in the world. All<br>mills were purchased installed and commissioned by world renewed milling<br>equipment supplies. The butter Group of Switzerland (Buhler)</p><p><b>DANGOTE<br>FLOUR·MILLS GROUP OVERVIEW</b></p><p><b></b></p><b><p>Despite the fierce competition, DFMremains a significant<br>player in the flour milling and associated products industry.</p><p>Dangote Flour Mills Plc was incorporated in, 2003 with<br>its registered office at 8 Rycroft Road, off Liverpool Road, Apapa, Lagos.</p><p>Dangote flour mills PLC entered into management and<br>technical services agreement dated 2nd January, 2006 with Dil. The<br>Agreement is for an initial period of 5 years subject to termination by either<br>party in accordance with the terms of<br>the agreement.</p></b></b></b></b></b></b><br> <br><p></p>