Distribution Channel System Functionality: A Look at the Practice of some selected Fast Moving Consumer Goods (FMCG) in South West Ethiopia Teklu Geremew*, Dejene Tariku** *Jimma University, Business and Economics College, Management Department **Assistant Professor, Jimma University, College of Public health and Medical Science, Department of Epidemiology Online published on 27 April, 2015. Abstract Studying on Distribution Channel System is eminent as it adds time and place value to customers. Fast moving consumer goods (FMCG) pass through different channel paths and these channel members perform different distribution channel functions. FMCG are those goods which have short shelf life and high turnover. These commodities demand special treatment in the process of moving them to the next level. Ethiopian government issues policies and procedures to govern the behavior of channel players and protect end users rights. The main objective of this paper was to identify the channel members (wholesalers, retailers, and government bodies) engaged in the distribution activities of the selected FMCG and assess their roles in South West Ethiopia. The goods considered in this study are cooking oil, Sugar, and Wheat flour. The study tried to look the network of distribution channel in three different areas (Jimma Zone - Jimma Town, Illu Ababora – Gambela and Bonga – Mizan – Tepi). The study followed exploratory and descriptive research design. Data were collected from the distribution channel members: consumers, wholesalers, retailers and concerned government officials through structured and unstructured questionnaire, interview schedule and observation. Both qualitative and quantitative analysis techniques were employed to convert the raw data into information. Quantitative data were analyzed using SPSS. Factors were rated to see their magnitude of significance to overall channel distribution performance. The major findings show that there is considerable problem on the availability of these products in the region under study. The price used to fluctuate time and again that hampered end consumers’ daily living. Product availability and price influenced customer's satisfaction most out of the variables considered in this study. The government is controlling the market where private wholesalers, retailers, consumer associations and kebeles played significant role in the distribution channel system. In the short run the government should take market settlement measures whereas in the long run it has to limit its role to facilitation and law enforcing. The market should be organized in a competitive way where demand and supply manages the equilibrium. Wholesalers and retailers should cooperate with the government to solve the market problem. Top Keywords Channel functionality, customer satisfaction, distribution channel system, fast moving consumer goods, and South West Ethiopia. Top |