The Impact Of Informal Distribution Channels On Breweries Export Development

The supply chain management for breweries and production lines in the alcoholic beverage industry is a key area of focus for many companies.It is today amongst the hardest sectors to optimize as the data can be somewhat the issue.Indeed,the production and the distribution model of beer impacts directly their production forecasts and inventory levels,thus their performance and efficiency.The production is linked to the company’s sales volumes and the quality of the stability of those channels in order to grow steadily and control all metrics.Informal channels,also known as parallel market,are a challenge for brand owners and their international scale operations.The literature review concentrated its research on existing facts about informal channels,brewery export strategies,supply chain models and brand value creation methods of breweries.This paper describes and analyses through in-depth interviews of breweries,traders,wholesalers and more the processes used in the supply of beer through informal channels and the impact it generates on the brand and the operation processes.The study has been able to find that the parallel market is a profitable sales channel and an efficient distribution channel for a brewery or any beer brand but only in the short-term as an opportunistic approach.While looking at the long-term,the consensus is that a brand should put all efforts to not be present in informal channels as it is not sustainable and hurts brand value.The particularity of this chosen subject is the difficulty to estimate how choosing to sell goods through the wrong sales channels can have implications for a brewery both financially and qualitatively speaking.By analyzing inventory forecasts levels,production inefficiencies,export price strategies and consumer expectations,it has been possible to better situate the areas of negative impact.This thesis sums up 3 main results for the research questions that are first the supply chain implications,the sales performance aspect and the beer brand reputation to finish.All of them with unique consequences and benefits.