Distribution Decisions

By tying up with existing facilities, CCI (Coca Cola India) managed to score on the distribution aspect by making its brand, Kinley available throughout the country which gave credence to its rising market share in India. The below diagram represents a typical chain of manufacture to distribution of Kinley, the brand for packaged drinking water of Coca Cola India. The company follows the same chain for all its product. Because of the presence of its strong brand like Coca Cola, Thums Up, Sprite, Limca, etc. it makes it easy for the company to market as well as distribute Kinley through the same channel.

CCI has a wide and well managed network of salesmen appointed for taking up the responsibility of distribution of products to diverse parts of the cities. The distribution channels are constructed in such a way that the demand of customers is fulfilled at the right place and the right time when it is needed by them.

Direct distribution: In direct distribution, the bottling unit or the bottler partner has direct control over the activities of sales, delivery, and merchandising and local account management at the store level.

Indirect distribution: In indirect distribution, an organization which is not part of the Coca-Cola system has control on one or more of the distribution elements (Sales, delivery, merchandising and local account management)

Merchandising: Merchandising means communication with the consumer at the point of purchase to convey product benefit, value and Quality. Sales people and delivery personnel both have this responsibility. In certain locations special teams who go into business locations to specifically merchandise our products.

DISTRIBUTION ROUTES

The various routes formulated by CCI for distribution of products are as follows:

Key Accounts: The customers in this category collectively contribute a large chunk of the total sales of the Company. It basically consists of organizations that buy large quantities of a product in one single transaction. The Company provides goods to these customers on credit, payments being made by them after a certain period of time i.e. either a month or half a month.

Examples: Clubs, fine dine restaurants, hotels, Corporate houses etc.

Future Consumption: This route consists of outlets of Coca-Cola products, wherein a considerable amount of stock is kept in order to use for future consumption. The stock does not exhaust within a day or two, instead as and when required stocks are stacked up by them so as to avoid shortage or non-availability of the product.

Examples: Departmental stores, Super markets etc.

Immediate Consumption: The outlets in this route are those which require stocks on a daily basis. The stocks of products in these outlets are not stored for future use instead, are exhausted on the same day and might run a little into the next day i.e. the products are consumed at a fast pace.

Examples: Small sized bars and restaurants, educational institutions etc.

General: Under this route, all the outlets that come in a particular area or an area along with its neighboring areas are catered to. The consumption period is not taken into consideration in this particular route.