Distribution Network Performance Measurement And Improvement (case Study On B.g.i Ethiopia)

Over the past decade, there has been an increasing emphasis on Supply ChainrnManagement as a vehicle through which firms can achieve competitive advantage inrnmarkets. In this research downstream part of a supply chain (distribution network) of therncase company (BGI Ethiopia) has been discussed. BGI Ethiopia is one of the biggest beerrnproducing companies in the country. Not so long ago the company has more than 50% ofrnthe market share when the annual beer producing capacity of the country was 5 millionrnhectoliters, though back then there was no strong competition for the company. Thernmarket share began to shift in 2011, when global giants Heineken and Diageo joined thernmarket, turning it into a show of force between global beer makers who have been takingrnchunks of the market. Even though BGI’s producing capacity has also increased to 4.3rnmillion hectoliters annually, the market share of the company has declined to 35.8%. rnWhile increased in production volume, the loss of the market share is linked to therndownstream segment of the supply chain (the distribution network). In the research, BGI’srndistribution network under the scope of Addis Ababa’s distribution network has beenrnassessed. In Addis Ababa alone, there are six main disruption agents for the company. Andrnthe performance of these agents is determining the competitiveness of the company. Thernperformance of the distribution network has been evaluated in accordance to SCORrnmodel, setting five performance attributes and each having their own metrics. Arnquestionnaire survey was distributed among the outlets of the case company and interviewsrnwhere made identify the KPI for the performance of the distribution network. The datarncollected from the questionnaires were analyzed using SPSS software. The research hasrnrevealed the KPI for each performance attribute based on the RII and a regression analysisrnwas made to see the effect of this KPI on the other metrics., pointing out that this selectedrnKPI has to be well managed for the better improvement of the distribution network whichrndirectly will improve the competiveness of the case company and increase its market sharernonce again. From the analysis, it has been concluded that perfect condition delivery hasrnbeen identified as the KPI for reliability of the distribution network, sourcing time forrnresponsiveness, distribution network adaptability with sub major distributers and outlets forrnthe agility, distribution cost for the cost metrics and material handling efficiency for assetrnmanagement efficiency. Finally, it is suggested that in order to enhance the performance ofrnthe distribution of the case company, the distribution network’s performance has tornimprove by: increasing the number of vehicles doing the delivery to reach the reliabilityrnissue, adding more main distributing agents to address the responsiveness attribute,rnadjusting adaptability and creating coherent flexibility making the network more agile,rnreducing distribution cost, improving material handling efficiency.

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