The effectiveness of route-to-market distribution strategy to fast moving consumer goods industry, carbonated soft drinks category, case of SBC Tanzania Limited - Pepsi

Massawe , Michael Emanuel Karau (2014) The effectiveness of route-to-market distribution strategy to fast moving consumer goods industry, carbonated soft drinks category, case of SBC Tanzania Limited - Pepsi. Masters thesis, The Open University of Tanzania.

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Abstract

Effective distribution has become a big challenge to Fast Moving Consumer Goods especially carbonated soft drinks manufacturers. SBC Tanzania (Pepsi bottler) shifted from direct selling to indirect selling model operating through the appointed distributors; termed as route-to-market model. The objective of this study was to assess the effectiveness of this strategy to FMCG – carbonated soft drinks category as implemented by SBC Tanzania Dar es Salaam Plant specifically investigating the stock availability/stock norm maintained by distributor, examining how effective is just in time stock supply, determining the extent to which customer service has been improved and examining the extent to which market feedback has been improved. Stratified sampling of 50 respondents consisting of SBC Sales team and distributors was selected; using both qualitative and quantitative research approach in data collection. Questionnaires, interview, observation and documentary review were the tools used in collecting data before analysing them by SPSS. Findings showed that route-to-market was somehow effective; market feedback was immediate, customer service was improved, and stock was available but not across the range. There were discrepancies noted on having enough warehouses, price was escalated by distributors’ salesmen, territories were not fully served and utilised as a result sales volume was not satisfactory leading into lost market share, decreased profits, and low products visibility in the market. It was recommended that the company should recheck its RTM strategy’s checklist from distributors appointment to adhering to the Key Performance Indictors set for mutual goals achievement.

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