Distribution Strategy of ACI Nutrilife Rice

bran oil, Bangladesh

Prepared By
Md. Zahid Ul Islam
Student of International Business
University of Dhaka

1. What is distribution?
Distribution is one of the four elements of the marketing mix. Distribution is the
process of making a product or service available for the consumer or business user
who needs it. This can be done directly by the producer or service provider, or using
indirect channels with distributors or intermediaries.

2. Distribution strategy
Distribution Strategy is a strategy or a plan to make a product or a service available
to the target customers through its supply chain.
On a macro level, there are two types of distribution:

i. Indirect distribution
ii. Direct distribution

2.1 Indirect distribution: it is a chain of intermediaries through which a product

moves in order to be made available for purchase by a consumer. An indirect
channel of distribution typically involves a product passing through additional steps
as it moves from the manufacturing business via distributors to wholesalers and then
retail stores. These are ACI rice bran’s distribution strategy:

Distributor/
Manufacturer Retailer Consumer
Wholesaler
 Push strategy: A channel partner term that is used to describe how products
and services move through channel partners to the consumer. A push strategy
uses marketing channels, such as trade promotions, to "push" a product or
service through to the sales channel. It includes convincing them to stock ACI’s
product. Also, ACI conducts various promotional activities to connect with the
retailers. Mostly, ACI provides ricebran oil to retailer and retailer sells it to
customer.

Manufacturer Retailer Consumer

 Pull Strategy: A pull strategy involves the manufacturer promoting their product
to the target market to create demand

Manufacturer Consumer

They are selling ACI rice bran oil to their consumer by ACI logistic Swapno and E-
Bazar.

Also ACI rice bran oil uses several promotional mixes to create demand in the
market:

I. Providing discount
II. Free gift
III. Major event sponsorship

2.2. Controlling & maintaining the distribution chain in ACI

ACI divided Dhaka city into three different zones. Which are zone A, zone B and
zone C. These three zones controlled by a sales manager. Each zone controlled by
a zone sales manager (ZSM). They collect data from Area sales manager (ASM) and
provide them to sales manager (SM). ZSM and ASM are the most important persons
who lead the team strategically. They set the strategy along with upper level
management and implement those with the association of Sales representative (SR)
and Territory sales officer (TSO). They have a target and try to fulfill the target
strategically. After a time period they evaluate the sales volume and take further
decision accordingly.

SR is the person who receives the order from the retailers. Responsibility of SR is
the most important part of distribution strategies. First, they start to visit the market
and offer their products to retailers. If retailers need those products, he gives order to
him. Also, SR presents trade offer (if trade offer is available) to retailer like “Buy 4 5
liter of rice bran oil get 1 liter of soyabean oil free”. Beside this, they provide gifts to
their valuable customers (retailers).

TSO’s responsibility starts after taking order from SR. TSO is the person who is
responsible to deliver the ordered product according to shop’s address. Also, TSO
collects money from the retailers.

It is important to deliver the product in time. Sometimes, the retailers need to stock
product based on customer excessive demand but unfortunately he did not get the
product in time. So, it causes loss to the retailers. That’s why TSO must be punctual
about time and session.

2.3 Direct distribution: A distribution system is said to

be direct when the product or service leaves the producer
and goes directly to the customer with no middlemen
involved. They directly sell to their customer by park
campaign on Friday and Saturday. People who are health
conscious they come to the park for morning exercise.
They also sell ACI pure brown atta, ACI pure multigrain
atta, ACI pure aromatic rice. These are also good for
health.

Moreover ACI directly sell to their consumer through a campaign ‘Edible oil at fair
price’ which occurs for a month. They sell rice bran oil, sunflower oil, soybean oil at
distribution price. They set a van for a month, customize it move around to potential
areas of Dhaka city and sell oil at fair price.