I am currently in Ghana and evaluating a distributor network for a company in the telecommunication industry. Some key learnings from my trip to date:
Be aware of the distributor powerbase – competent distributors are key to most supply chains and collaboration is critical in expanding your footprint. However, distributors should not hold you and your decisions hostage. In emerging markets, even big distributors are likely to have limited reach in key regions and areas. Distance yourself from you current situation and ask yourself the following questions: If I have to start this business from scratch today, what would the selection criteria look like and which key areas and regions do I want to penetrate?
Take note of the evolution – too often supply chains in emerging markets just evolve without any strategic intend. Modern trade and retailing are expanding in Africa (maybe not as rapidly as Asia) and middle class consumers shopping patterns are changing. How will these changes in the market affect your business and are you taking the necessary steps to adapt to these changes?
Invest in people and partners – training budgets should not be limited to employees but must include strategic partners. Develop and invest in your partner base and they will grow with you. Training is gold in developing economies and will also go along way in building relationships.
Don’t be an evil gorilla – when it comes to your distributors in emerging markets, you are likely to be the 800 pound gorilla. Be transparent and handle them with the respect they deserve. There is a lot to learn from even the smallest of partners.