The Citizen (Dar es Salaam)
The Citizen Reporter
9 May 2008
Soft drink maker Coca-Cola Africa says it is enhancing its distribution network to create more employment on the continent.
It says the new distribution network would create between 1,300 and 2,000 additional independent distribution businesses, between 5,300 and 8,400 new jobs and generate revenue of between US$320 million (about Sh368 billion) and US$520 million (about Sh598 billion).
The company's CEO, Mr Neville Isdell, says the firm will work with its bottlers to boost economic growth throughout the continent by investing in the expansion and upgrading of its distribution network of Manual Distribution Centres (MDCs).
Coca-Cola's MDC business model, which has been operational in the past five years, is based on independent local entrepreneurs in some African countries.
It has created new small businesses as well as jobs and increased skill levels, while rolling out in four East African countries.
Tanzania was specifically chosen for a pilot project that would investigate ways to further enhance the socio-economic impact of the distribution system.
"The Coca-Cola Company aims to support the development of sustainable communities, because without sustainable communities we do not have sustainable business," says the Coca-Cola Africa Business Unit President for East and Central Africa, Mr Nathan Kalumbu.
"The MDC model, which is currently being executed in a number of African countries, including Tanzania, has created new small businesses, new jobs and increased skill levels.
"It provides a powerful platform from which we offer entrepreneurial opportunities that open the door to job and wealth creation," he says.
The pilot project is being conducted in partnership with key bottling partner Coca-Cola Sabco, the Harvard CSR Initiative and the International Finance Corporation.
MDCs are managed by third party distribution centres.
Instead of trying to service thousands of small retail outlets with small drop sizes, the bottler distributes to carefully selected MDCs which sell Coca-Cola products exclusively.
Owners of the MDCs are actively supported and managed by the bottler who helps owners establish their operations.
This includes designing routes and methods of delivery as well as determining the frequency of delivery service required to maintain stock levels.
The key to the success of this approach is that MDCs are driven by entrepreneurs in touch with their markets while they receive ongoing support from the bottler and Coca-Cola.
The aim is to ensure that optimal selling conditions are maintained at the retailer level.
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