9 th Annual IAABD Conference May 20 -24

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9 th Annual IAABD Conference May 20 -24, 2008 Relationships between Breweries and Retailers in Cameroon Simon Sigué, Athabasca University Michele Onguetou, HEC Montreal Patrice Tonye, University of Douala 1

Outline • Research goal • Context • Conceptual framework • Hipotheses • Methodology 2

The Research goal To study the impact of the dominant brewer’s influence strategies on small retailers’ economic and non economic satisfaction in the context of dependence 3

Context Four main breweries Société Anonyme des Brasseries du Cameroun (SABC) -70. 7 % Guinness Cameroon S. A. - 16. 5% Union des Brasseries du Cameroun - 7. 0% SIAC Brasseries Isenbeck - 3. 8% 4

Context Distinctive advantages of the leader A large product assortment that consists of three major product lines: Beers, soft drinks and sodas, and water products Leading brands in several categories: Coca-Cola, Fanta, 33 Export… Extensive coverage of the market 5

Distribution channels Supplier Wholesaler Non exclusive retailer Consumers 6

Offering in the direct channel n n n Offer of the leading brands in many categories Product delivery Credits Rebates Promotion and merchandising support Refrigeration appliances 7

Expectations from retailers n n n n n On-time credit payments Abide by suggested retail prices Carry all the products including those that do not sale well Sort homogenously empty bottles in cases Make the outlet inviting Return damaged products Provide enough shelf space Maintain refrigeration appliances Serve cold drinks 8

Context Offerings Supplier Expectations Satisfied retailer Consumers 9

Conceptual framework Supplier’s use of threats Retailer’s economic satisfaction Supplier’s use of promises Supplier’s use of noncoercive influence strategies Retailer’s noneconomic satisfaction 10

Conceptual framework Economic satisfaction: Positive affective response to economic rewards that flow from the relationship with a partner, such as sales, margins, rebates, … (Geyskens et al. (1999)) Non economic satisfaction: Positive affective response to noneconomic, psychosocial aspects of the relationship with a partner. A satisfied partner sees the interactions with the other as gratififyng, fulfilling, and easy (Fisher and Nevin 1996, Geysken et al. 1999). 11

Conceptual framework Threats: Influence strategies used when a source communicates to the target that it will apply negative sanctions should the target fail to perform desired actions (Frazier and Rody 1991) Promises: Influence strategies used when the source implies that it will provide the target with specific rewards or benefits contingent on the target’s compliance with the source’s desires. (Frazier and Rody 1991, Geyskens et al. 1999) 12

Conceptual framework Non coercive influence strategies Information exchange: Influence strategy whereby the source uses discussions with the target to try and alter the target’s general perception of how its business might be operated to be more profitable (Frazier and Summers 1984) Recommendations: Influence strategy whereby the source suggests a set of actions that could help the target in improving the performance of its business (Frazier and Summers 1984) Requests: The source merely communicates the actions it would like the target to take without implying any specific consequence (Frazier and Summers 1984) 13

Hypotheses Threats Building on Anderson and Narus (1990) and Scheer and Stern (1992): H 1: The use of threats affects negatively retailers’ economic satisfaction. H 2: The use of threats affects negatively retailers’ non economic satisfaction. H 3: The negative effect of threats on non economic satisfaction is stronger than on economic satisfaction. 14

Hypotheses Promises Building on Frazier and Summers (1986), Frazier and Rody (1991), Geyskens et al. (1999), and Scheer and Stern (1992): H 4: The use of promises affects positively retailers’ economic satisfaction. H 5: The use of promises affects negatively retailers’ non economic satisfaction. 15

Hypotheses Non coercive influence strategies Building on Frazier and Rody (1991), Geyskens et al. (1999), Mayo et al. (1998), and Scheer and Stern (1992): H 6: The use of non coercive influence strategies affects positively retailers’ economic satisfaction. H 7: The use of non coercive influence strategies affects positively retailers’ non economic satisfaction. H 8: The effect of non coercive influence strategies on non economic satisfaction is stronger than on economic satisfaction 16

Methodology Phase 1: Exploratory study In-depth interviews with 10 supplier’s sale managers and delivery personnel In-depth interviews with 30 drinking bar owners and operators (retailers) Phase 2: Survey Population: bar owners who buy directly their supplies from SABC and have been in the market for more than 6 months Sample size: 600 bar owners in Douala and Yaounde 17

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