indirect distribution in Subsaharian Africa

or how can commercial performance go together with informal economy

Developing a commercial activity in an African emerging country means betting on difference, braving contrasts in every way (human, geographical, cultural, political, social, commercial…). An ambitious strategy aiming at covering all the targeted markets will rely on a multichannel distribution system, made of direct sale and indirect distribution channels.

Indirect distributors, efficient close-by relays for a rapid setting-up and an optimal coverage.

Over an heterogeneous and contrasting continent with cultural differences and specific commercial usages, added value of local partners can be easily proven. Thus, they contribute to help the operator to:

Overcome and deal with internal constraints and emerging countries’specificities.

Thus, we should note the paradox of the African economy in which authorities highly intervene and yet must face a side of the economy that is beyond any social and economic policy and thus state control. This informal and inescapable economy consists of jobs unrecognized by employers, badly paid, not protected and often undertaken by women and even children… In addition, consumers with specific profiles and needs require a suited approach (illiteracy, very low income, cultural multiplicity and heterogenousness, religious and tribal influence, population youthfulness…)

Achieve a good market coverage thanks to the often endless sprawl of networks

Which could not be implemented by the operator due to the lack of time and means. Therefore, even if most of the population is concentrated in industry areas in constant growth (main towns), the sub-area and its wide non-urban areas where many communities are sporadically spread out, still represent a significant market which is to be considered in spite of being not very accessible (infrastructure not enough developed, communication networks not widely deployed, communication means often limited and collective…). With the help of one or several local partners, it shall be easier and quicker to reach and cover all the territory. Besides, the operator will thus have a wider consumer panel so as to gather prospects/customers’ expectations, measure customer’s satisfaction, develop its activity notably thanks to a real recognition of African specificities (community influence, strategic role of the ‘word-ofmouth’, importance of the hierarchy respect in social relationships...).

Make savings at different levels and reduce commercial and financial risks

a partner already established with a well-developed portfolio will enable the operator to benefit from prospecting and implementation costs cut and from a short delay in the takeover of presales or after-sale requests, thus unloading the direct marketing channels or the operator’s customer services. Moreover, as risks are being shared between the different partners, the operator will be less sensitive to the impact of some events such as orders and cash fluctuations particularly from retailers…

A network of partners structured and motivated for a better performance

Organization and recruitment process.

Distributors’recruitment will rely on tender and precise specifications. Recruitment and agreement conditions should be clearly defined and expressed to homogenize calls for applicants, ease the selection and avoid any misunderstanding or even disputes. Then, the operator should make real efforts with training (at technical and commercial levels), leading and putting efficient commercial tools at the disposal of partners to ensure their good skill level and high quality of service.

Granted discounts and payment methods.

The business model will favour cash payment at collection of goods by the distributors. Calculations for discount allocation will rely on clearly determined quantitative and qualitative criteria.


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