WINNING WITH DISTRIBUTION EXPERIENCE FROM THE FAST MOVING CONSUMER GOODS SECTOR

Dr. Andrews. A. Akolaaaakolaa@yahoo.com

Outline

• Fundamentals of FMCG• The Critical Role of Distribution• Experiences from the Beverage Industry• Designing Channel Structures • Selecting Channel Partners • Leveraging and Motivating Channel Partners• Measuring Distribution Effectiveness

The Distribution Titan

Where it all begins!!!!

Delivering Convenience to the consumer

WHAT THEY HAVE IN COMMON??

The 6 fundamentals of fast moving consumer goods

• Most frequently bought • Item are mostly small in value• Slim margins • Normally not a shopping product/Routine • Mass market and a numbers game• Can’t survive without intensive all Ps

Basic Role of Distribution

• Route to market(RtM)• Route to Consumer(RtC)• Availability and Convenience • Right condition and service • Right pricing• Financing

Extended Role of Distribution

• Partners for growth• Source of competitive advantage • Brand ambassadors in the market place • Source of market intelligence • The vehicle for innovation deployment

Experiences from the Alcoholic Beverage Industry-

• Very competitive with varying SKUs • Special marketing requirements/short life spans• Legislations and controls• Sin products• Complex product from bottling to consumption• Unethical marketing practices( lock outs)• Price elasticity

How can one win the war in fmcg?

D CompetitiveQ

Beverage Gaining V

P Advantage P

Quality DistributionVisibilityPersuasionPromotion

Distribution on and off trade‘be there or be trashed’

• Channel management• Route management

QUALITY in Distribution ‘differentiate or be deprioritized’

• COLD• GLASSWARE • RIGHT TASTE

MAINTENANCE

Visibility in distribution channels‘BE THE FOCUS OR BE FORGOTTEN’

Win the visibility war!• In bar• Outdoor• Back bar• Souvenirs • Branding

Persuasion in Distribution ‘be present or be pushed out’!

• The right personality• The right attitude• Unrelenting • Always around• Understand the industry end to end•

Modern trademanagement

Promotions in Distribution Channels- be top of mind or be through mind

• Activations• Consumer loyalty

programmes • Taste testing and sampling

• Activations sample

Designing Channel Structures

•Intensive or selective? •Direct or indirect? • Type of product • The corporate objective as of the time• Level of industry of competition • Consumer needs and requirements • Cost implications • Final price implications

Selecting The Right Channel Partners

• Financial resources• Capacity • Capability• Hungry for success attitude• Willing to dirty their hands

Leveraging Channel Partners for Competitive Advantage

• Feedback looping • New product launches• Product mix sales plans• High margin focus plans• Volume driving plans

Channel Partner Relationship Management

• How does it work?- The Guinness Experience

• Partnership for growth programme to build capacity

• Appointment of distributor relationship managers• Appointment of sales representatives • Van Sales Men management• Managing conflicts

How do we Motivate Channels Members for Performance

• Guaranteed Good margins• Loyalty schemes• Super support programmes(set up support,

training, etc)• Travels and site visits • Guaranteed supply • Annual conferences and performance awards

How to Measure Distribution Effectiveness

• Weighted distribution• Numeric distribution• Out of stock ratios• Stock cover days management • Store keeping unit management

End

• Thank you