RC Cola shares blueprint for a successful dealership
MANILA, Philippines - Most old timers in the beverage industry list the following indispensable components in the successful dealership of a soft drink brand: capital, warehouse, routing trucks, and salesmen. Of course, the primary consideration is still the product, especially if the drink has enough fizz, with strong consumer pull and can sell even with just a reasonable amount of push. But for a daunting undertaking like beverage dealership, finding the right collaborators has now also become a must.
While fostering a healthy relationship between the dealer and the product manufacturer or the licensed distributor is an ideal scenario, a number of beverage dealers today are still faced with a different reality, often finding themselves stuck in an inflexible business agreement with manufacturers. So even before dealers have a crack at success, their operations have already fizzled out.
One Filipino company engaged in carbonated soft drink dealership has taken a different approach, putting a premium on relationships. As a result, the dealers of RC Cola products are now not only tasting reasonable success but have also since built an alliance with the company that goes beyond the professional kind.
Chito Sebastian, national sales manager for Asiawide Refreshments Corp. (ARC), the licensed manufacturer and distributor of RC Cola, describes the company’s dealers as “business partners.” While it is important for dealers to have the means and determination to succeed, ARC believes that placing importance on a relationship plays a critical factor. In fact, “our company’s dealership program is centered on this business-partnership model, which underscores the importance of personal relationships,” he adds.
Taking a page from the company’s credo, “Value first. In everything we do, Tatak Asiawide, Galing Pinoy, Diskarteng Asiawide,” ARC also puts a premium on the value of collaborative partnerships with its dealers. Like a puzzle, RC Cola dealers are vital pieces that contribute to the whole system. As Chito succinctly puts it, “It is a mutuality of business interest. So it is only logical that we help each other out throughout the course of the business partnership.”
Again, unlike other beverage firms, the setup that ARC offers is very different from those commonly afforded to beverage dealers (such as compliance with logistics requirements and other typical stipulations), like exclusive territories with boundaries, prohibiting a dealer from selling products not carried by manufacturers and similar other “restrictive” terms and conditions. Any of these don’t form part of an ARC contract at all.
“Some people will find this odd but unlike most other beverage firms, we at ARC don’t actually encourage exclusivity,” says Chito. “We give them independence to do what they want with the business. We don’t dictate to them what to do and what products to buy. What we do is foster personal relationships, treat them as one of our own. We also make it a point to guide and support them in key areas of the business like marketing.” For dealers, especially those with small capital, limiting products to sell may prove to be a risky move. Beverage dealership, after all, is a volume-driven industry.
Taking this into consideration, ARC has espoused free enterprise. With this kind of setup, dealers can sell both RC Cola and non-RC Cola products at the same time. The diverse stock bodes well for the dealer — more products for consumers to choose from equates with more profits. The company has also enacted schemes to benefit the dealers. These include deposits on an installment basis as opposed to the cash-on-delivery treatment usually used in most dealership transactions. For traders who roll over profits, the deposits on an installment scheme often suit them well.
Capital resource is also a big factor in beverage dealership as there are some entrepreneurs who are keen on embarking upon the business, but are constrained by limited resources. To help them, ARC has put in place schemes like a delivery tricycle loan package (called Ariskels) as well as special dealer assistance that encourages them to possess a secure and sufficient space instead of investing heavily on large warehouses, computing systems or uniforms. To sweeten the deal further, partners are also given volume discounts based on a bracket system. RC also assigns a company employee to partner with the dealers to help further develop their target market or sell additional and/or new products.
To further promote partnership and camaraderie, ARC also visits dealers regularly to see how they are doing. This is usually done unannounced, especially when the dealer is sick or celebrating a birthday. ARC makes it a point to always bring a specially designed RC cake with greeting card to make the visit truly memorable, just like what a true “kapamilya” would do for a loved one.
As ARC continues to become a winning Filipino company and expands its operations, dealers have likewise started to reap monetary success, which is how a business model must be: profitable. But the creation and cultivation of long-lasting relationships has made ARC and its dealers perfect partners in a successful dealership.
