THE EFFECT OF DISTRIBUTION PERFORMANCE ON MARKET SHARE; COMPARATIVE STUDY IN THE CASE OF HEINEKEN BREWERIES SC AND BGI ETHIOPIA

Abstract

The purpose of the study is to emphasizes on the effect of distribution performance on Market share; comparatively in the cases of Heineken breweries S.C and BGI Ethiopia in Addis Ababa region by considering order fill rate, planning, stock management, distribution capacity, distribution channel used by competitors, distribution flexibility, support of the company to distributors , coordination between the company and distributors, distribution regulation and communication between the company and distributors. The study was performed in quantitative and qualitative research approaches. To reveal the determinants of market share descriptive and explanatory research design were used. For selecting sample respondents’ probability sampling techniques was used for outlets and non-probability sampling techniques was used key informants by purposive and for beer distributors. The data analysis was performed by inferential and descriptive statistics. The total sample size was 231. Major findings of the study indicate that there is positive correlation between market share and distribution performance. However, distribution channel used by competitors have a positively correlated but statistically insignificant with market share. The study revealed that, the value of (R = 939a ) and (R2 =.881) obtained under the model summary part was statistically significant. The study concluded that the market share of breweries is significantly determined by those 10 independent factors. The study shows that the extent of distribution performance of BGI Ethiopia is better than Heineken breweries. Thus, Heineken breweries should grant loans with long period repayment for distributors to enhance the financial capacity distributors to invest more on warehouse facilities and trucks and BGI Ethiopia has to make adjustment on distribution policies and procedures which is currently became the major hinders in the flexibility of the distribution process.