HOW TO BE A COCA-COLA DISTRIBUTOR IN KENYA
Coca-Cola is the largest soft drinks manufacturer in the region that has managed to build a reputable brand for the past 7 decades.
The soft drinks giant started its operations in Kenya way back in 1948 along Industrial Area’s Addis Ababa Road and today has four branches namely Nairobi Bottlers, Coastal Bottlers, Equator Bottlers and Almasi Beverages Ltd which is a merger between Mount Kenya, Kisii, and Rift Valley Bottlers.
Considering the fact that Kenya is being ranked as one of the top 3 markets for Coca-Cola in Sub Saharan Africa, today we are going to look at some of the requirements one has to meet if they are interested to be a distributor of Coca-Cola products ( Sparkling Soft Drinks, Minute Maid Juice, Dasani water and Monster Energy).
*Story of Yasmin Kamir – Coca Cola distributor*
Yasmin Kamir is the owner of Eriza Investments Limited located in Ukunda which happens to be one of the leading Coca Cola distributors in the Coast region. However, she was not always a soda distributor, prior to this she used to run a small hardware shop.
Her journey to becoming a Coca Cola distributor started off in 2013 while she was still running the hardware. It was during her daily commute to and from work that she noticed that the people in her area did not have access to sodas which happened to be in great demand due to the hot coastal weather.
Spotting a business opportunity, she approached the person who used to distribute sodas in the area in a bid to know how she can get into the business. The individual intent on discouraging her from venturing into the business, told her that if she wanted to start, she needed to buy 150 crates of soda from him and that she would get be getting a profit of Ksh.10 per crate.
Despite the low margins, Yasmin saw an opportunity and she got a loan to purchase the crates and she started selling the sodas and due to the demand business was good.
After some time, she decided to visit the distributor in her area hopping to get better prices for the sodas that the ones she was getting.
Unfortunately, she found that the person whom she had been dealing with was the authorized distributor in the area so there was no way she was going to get a better deal.
However, as they say, every cloud has a silver lining in that during her visit to the distributor, she got to find out that he was struggling financially and could not be able to buy enough sodas from Coca Cola to meet the demand in the area.
This confirmed to her that indeed there was a good business opportunity in selling sodas. It was at this point that she decided to buy a pickup which she started operating with her husband where she assumed the role of a saleslady.
At this point business really picked up as she was able to serve the market that the official distributor could not satisfy.
In 2014, Nick Maina who was the Regional Manager for Coca Cola (which she didn’t know at the time) passed by her shop and asked for Ginger Ale, Fanta Strawberry, Soda Water and Club Soda.
Nick was pleasantly surprised that she had all these products yet their official distributor in Changamwe did not have them. The next time she saw Nick, he was in the company of top officials from Coca Cola who included the then C.E.O Mr. Ebrahim.
Nick had seen the potential in Yasmin’s business, and he urged the C.E.O to help her expand. Mr. Ebrahim must have seen Yasmin’s passion for her business due to the fact that he told her to come see him in his office the following day.
When she got to the office, Mr. Ebrahim reiterated his willingness to help her expand her business, but the only problem was that she did not have the resources needed to purchase more stock. It was at this point that Mr. Ebrahim asked her whether she had a title deed that she could use as collateral to access financing.
Luckily, she had a title deed, Mr. Ebrahim referred her to a bank manager who then issued her with a loan of Ksh. 1 Million to facilitate her expansion and this is when her business really kicked off.
Come 2015, due to her hard work, she was made a full distributor and if that was not enough, she was also given a new lorry on flexible credit terms by Coastal Bottlers to help her distribute the sodas. She was able to finish paying for the lorry in good time and even emerged as the best distributor in that region.
Her hard work paid off in that when a new region opened up, she was appointed as the official distributor and she was also given another lorry on credit to aid in distribution. She also bought a lorry from her proceeds because she could see that her business was growing and there was a need.
In 2018, due to her good performance in the areas that she had been appointed as a distributor, she was also given the Ukunda area to manage thus expanding her business.
Since 2013, Yasmin’s business has grown in leaps and bounds in ways that she could not have imagined, and she gives all the credit to Coca Cola for aiding in her journey. That is from giving her vehicles on credit at a time when she could not afford to buy a new vehicle for her business to giving her stock worth over 10 Million on credit which have all aided her to be the successful business lady she is today.
*Capital*
To be a coca cola distributor, one must be able to raise a startup capital of between 3 million to 5 million Kenyan Shillings. You should also be able to obtain a bank guarantee of 2 million Kenyan Shillings.
*Computer Literate*
One must be or have staff who are computer literate so as to be able to compute stocks and sales reconciliation.
*Storage*
This is an important aspect in any business, especially if you plan to be a distributor. You will need a place to store your products after buying them in order to make the distribution easier. In this case, you will need a warehouse facility comprising a minimum of 2000 Square feet storage.
*Target Market*
You will be required to state your target market? Where are you going to be distributing the products? It is very important to state where your market interest lies.
*Commitment to Nairobi Bottlers limited Code of Business Ethics*
A number of business ethics are explained in the coca cola website which falls under the Nairobi Bottlers Limited. The rules include:
Protect the environment. Conducting business in ways which protect and preserve the environment.
Child labor. Supplier will comply with all applicable local and national child labor laws.
Provide safe and healthy workplace. Maintain a productive workplace by minimizing the risk of accidents, injury, and exposure to health risks.
Forced labor. Supplier will not use forced, bonded, prison, military or compulsory labor.
Abuse of labor. Supplier will comply with all applicable local and national laws on abuse of employees and will not physically abuse employees.
Demonstration of compliance. Supplier must be able to demonstrate compliance with the supplier Guiding principles at the request and satisfaction of The Coca Cola Company.
Work hours and wages. Compensate employees relative to the industry and local labor market. Operate in full compliance with applicable wage, work hours, over time and benefits laws, and offer employees opportunities to develop their skills and capabilities and provide advancement opportunities where possible.
Freedom of association and collective bargaining. Supplier will comply with all applicable local and national laws on freedom association and collective bargaining.
*Other requirements are:*
You must demonstrate strong sales/ general business expertise with a proven track record, including door to door selling.
You must be passionate about high performance and growth.
You must be a dedicated and committed entrepreneur for the foreseeable future on a full-time basis.
You must provide copies of certificate of incorporation, memorandum, relevant details of the application and KRA pin certificate.
Able to have distribution vehicles with adequate carrying capacity as stipulated by the Nairobi Bottlers Limited.
You should have an application letter which should be enclosed in an envelope together with all the required documents.
*Applications should include:*
Application Letter
a. Copy of Certificate of incorporation, memorandum and Articles of the Applicant and PIN Certificate
1. State the working capital and level of bank guarantee available
2. Market of interest
Applications should be enclosed in a SEALED envelope and addressed to:
Country Sales and Marketing Manager
Nairobi Bottlers Limited
P.O. Box 18034-00500,
Nairobi, Kenya.
*Finally*
As we always tell you, there’s no marathon race that has ever been won by those who did not start the race. If you like the idea discussed above and you have what it takes to actualize it…then don’t wait to start…just do it.
Also don’t forget to join our training on *WINES & SPIRITS BUSINESS*
A lot of Kenyans drink alcohol. There are huge profits to be made in this business.
And you can easily confirm this by peeping into the latest wines and spirits wholesale prices in Kenya and then comparing the prices that wholesalers give retailers and the average retail prices.
Actually according to my source, the minimum profit you can make per bottle is Ksh.30 so do your math considering that you are dealing with fast moving goods.
Wholesalers even make more because they are able to move bigger volumes.
by
Timothy Angwenyi
Business Consultant
Justine Nyachieo
Business Man & Mentor
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