This sample was created by a team of 7 juniors and seniors during Spring of 2016.

1. Analysis #3: KasKazi Network LTD Marketing Plan
Kristin Beaverson, Molly Ufheil, Andrew Felix, James Fong, Matt Szeluga, Alex Taddiken, and
Marie Humphrey
MKT 325
Professor Dana Lascu
March 23, 2016

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PROBLEM
Ng’ang’ a Wanjohi, CEO of KasKazi Network Ltd, identifies a key problem within
Kawangware’s supply-chain distribution model. The “Mass Market” otherwise known as kiosks
refers to the lowest tier of the supply chain before reaching customers. According to Wanjohi,
“the Mass Market was very fragmented” (Schuepbach, et al., 7). Payments not paid from the
wholesaler to the kiosk seller, little reliability of demand for new products, and no efficient
product turnover leads to a higher chance of dead stock and risky, inefficient business practices
for those in the distribution chain. This liability falls mostly to the wholesaler, whose business
may fail any day. As such, wholesalers do not want to share the market with KasKazi because
they run primarily as “small family businesses” and owners do not want to share their profits.
The wholesalers’ refusal to work with Wanjohi remains one of his largest obstacles to success in
his company. The unreliability of the wholesalers affects how manufacturers and kiosk owners
do business; Wanjohi explains, “ [manufacturers] were not able to set up adequate number of
wholesalers to get to the number of outlets that demand their products. In such cases, the kiosk
incurred additional costs of transport searching for such goods marked up the price”
(Schuepbach, et al., 7). Kowangware’s distribution model is both disorganized and ineffective,
causing the community to lose money rather than gain.
MICROENVIRONMENT
I. Stakeholders: The key stakeholders in KasKazi Network will be the 100,000 kiosks that
make up about 75% of the Kenyan retail market. These kiosks and their owners benefit
the most from the Wanjohi’s business, because they are the ones who are losing money
when they have to shut down their kiosks to restock their products. The low-income
consumers who eventually buy the goods from the kiosks also have an important stake in

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the company, because they are the ones who create the demand, and drive all business
transactions through the distribution channels. In order to raise enough capital to cover
the startup costs of this new venture, Wanjohi should contact George and David, who
were investors when he set up Pamoja Distribution Network. He needs to better explain
the role of kiosks in Kenya’s supply chain process by using current research, but also
including qualitative data about how the kiosks and supermarkets perceive their
placement in the market. He will have to disprove the newspaper articles that suggest the
long term survival of kiosks being taken away by supermarkets by explaining how the
supermarkets serve a different demographic—they do not want to serve the same
customers that the kiosks serve; they are centered in urban downtown city environments
close to bus stops whereas the kiosks are placed near the side of “commuting
routes…[on] winding streets” (Schuepbach, et al., 3). If he can convince them that
KasKazi has the potential to be a successful business, they can be assets to him. The other
main stakeholders in KasKazi Network are his potential customers, which may change
depending on who he decides to cater his business towards, since the wholesalers refused
his offer in the past.
II. Competitors: With Wanjohi’s creation of KasKazi Network, he is entering a new market,
that of creating a distribution network for the mass-market kiosks, that does not have pre-
existing competitors. Although some wholesalers have their own bicyclists who distribute
directly to the kiosks, they are not apart of a third party company who performs this task
as a part of their business, as KasKazi plans to do. Additionally, wholesalers have refused
to do business with Wanjohi, and laughed at him for attempting to do so. However, these
bicyclists who work for wholesalers, are indirect competition because they are

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distributing to kiosks throughout Kenya, which is something that Wanjohi plans to do, so
he will have to show that he can create more value for these customers than the
wholesalers can. It is likely that if Wanjohi creates a successful business model,
competitors will try to follow suit and enter the same service market of distributing to the
mass market. Looking at this from an internal business perspective, Wanjohi would have
to make his business model difficult to imitate in order to maintain a successful business
when competitive turbulence arises.
III. 4 Ps:
A. Product: The product, or service that KasKazi would be offering is its own
distribution network to kiosks. When Wanjohi finally gets his business off the
ground, he will be doing business with whoever it is has the product before it
reaches the kiosks, whether that be the wholesalers, key accounts, second-tier
markets, or manufacturers. The company will have bicycle sales representatives
(BSRs) who distribute goods in exchange for cash. In order for his venture to be
successful and in order to ensure clients that KasKazi will deliver a reliable
service, Wanjohi will have to create a system of accounts to monitor stock levels
and payments.
B. Price: At this point, it is difficult to determine how much KasKazi should charge
their clients for the service that they are offering. Once they hire bicycle sales
representatives have been hired and all the equipment needed to make sure the job
is done reliably and effectively has been purchased, Wanjohi should look at how
much he needs to charge in order to make a profit. He also has to consider that the

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wholesalers, or whoever his clients may be, will not be willing to pay a price
more than what it would cost them in order to deliver the goods themselves.
C. Placement: Although the actual service that KasKazi Network would be
providing has not fully taken shape, Wanjohi is very confident in the placement
that he wants within Kenya. He plans to serve the mass market in the over 200
low-income areas surrounding Nairobi, particularly around the area in which he
grew up and studied, Kawangware (Schuepbach, et al., 3).
D. Promotion: KasKazi does not have much of a marketing or promotion plan in
place. Its brand name means “North,” which has a symbolic meaning to Wanjohi
that he should try to emphasize in any promotional materials he creates. It may be
a good idea for Wanjohi to promote to the kiosks, and create a demand in that
market for his service, and then they can be the ones who go to wholesalers or
other markets to stress the demand for this service, as opposed to Wanjohi
appearing to be taking away from their profits, as the case suggests.
MACROENVIRONMENT
I. Population and Demographic: The Kenyan population consists primarily of low-income
consumers who subsist off a few dollars a day. They comprise 75% of the market and
therefore make roadside kiosks the primary area for activity in the supply chain. In
Kawangware, one of 200 low-income areas within the capital city, there are about
200,000 people. Of these people, 50% are children under 16 and 80% live in tremendous
poverty. To this market, pricing is sensitive yet consumers still value quality and are less
likely to trust unknown brands.

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II. Economic: From an economic standpoint, there are difficulties in establishing a company
like KasKazi Network. First off, Wanjohi needs to secure external financing in order to
fund his operations, which may be somewhat difficult to do in an economy like Kenya.
However, if Wanjohi is able to penetrate the market successfully, there is certainly the
opportunity for long-term sustainability. With expected lower costs than kiosk owners
and by undercutting mini supermarkets, KasKazi Network can have a clear advantage
over competitors that make up 75% of the market.
III. Political/legal:
A. Due to the predominantly unfettered Kenyan campaign finance system—it is
similar to that of the U.S.—larger businesses such as supermarkets have the
economic resources to influence elections and, ultimately, foreign and domestic
policy. Just as in the United States, running a political campaign in Kenya is
prohibitively expensive for all but the super rich. Thus, most candidates need
some sort of outside funding. Enter corporate lobbyists, who exchange campaign
contributions for policy favors that overwhelmingly stack the deck against the
average citizen.
B. In this context, for instance, Nakumatt—the Kenyan equivalent of Walmart—has
every incentive to influence politicians to make it harder for its competitors to do
stay viable. With little notice, a politician could introduce legislation to place
stricter operating standards on kiosks, citing “safety concerns.” Obviously this
scenario just described is hypothetical, but it is imperative for aspiring
entrepreneurs such as Wanjohi to keep their ears to the ground with regard to any
pending business legislation.

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IV. Natural: Kaskazi’s business model eliminates vehicle exhaust fumes and reduces the
pollution emitted into the air because the company will use bicycles as the primary means
of transportation instead of commercial vehicles.
V. Socio-cultural:
A. Unfortunately for Wanjohi, the market in its current state carries a number of
factors working against his proposed business venture. Immediately, he cannot
even enter the market due to his family name—wholesalers rarely branch out, and
consist mainly of small family business. Wanjohi’s situation is a Catch-22; on one
hand, he might be able to sway wholesalers on his business model if he can
demonstrate its viability. But on the other hand, he can’t demonstrate the viability
without first entering the market!
B. On the bright side, Wanjohi can point to other bicycle distribution networks,
which were by no means a new concept to Kenya. The article even notes that
some wholesalers has their own bicyclists who distributed to kiosks in their area,
and some companies even commissioned internal projects for the cyclists. Again,
however, it leads back to an obvious institutional disadvantage; his proposed
employers are already familiar and satisfied with their current bicycle distribution
providers.
VI. Technological:
A. Partnering with a multinational such as Coca-Cola would open the door to a
tremendous source of technological capital. One area where this would be
apparent is distribution, in the form of bicycles and company vans. Another
example is storage, referring to Coca-Cola’s propensity to supply refrigerators to

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businesses in order to safely store goods. Wanjohi would also benefit from Coca-
Cola’s vast international network of factories and distributors, affording him
access to a larger variety of goods.
B. The technological injection from a Coca-Cola partnership would trigger an
economic domino effect. First, Coca-Cola would need to employ more labor to
keep up with increased business. Next, those laborers would earn disposable
income. Third, the added technology in the local economy would increase the
level of supply of goods and services. And with the increase in disposable
income, consumers could afford to participate in the new, supply-enriched
market, thus stimulating more business and generating a cyclical process.
SWOT analysis
I. Strengths: Wanjohi wants to help kiosks sell their products better by providing
guaranteed shipment service of products from the wholesalers to kiosks. Currently,
bicycles and carrying bags on foot are the only means of transportation of goods. There is
no service in place for when or if the designated person gets injured or is unable to make
the delivery. Wanjohi’s business model will provide this guarantee, ensuring that the
delivery process goes smoothly because buying at kiosks are a basic necessity for kiosk
customers--not a lifestyle choice. In addition, the BSRs will act as sales consultants for
the wholesalers. A few BSRs will be assigned to an area of a few kiosks connected to one
wholesaler. Because of the nature of the job, they will know which products are needed
in the area and familiarize themselves with the wholesalers’ product offerings. This
insight into the market trends will enable wholesalers to provide better service and sell
more products, making demand for products more reliable and increase product turnover.

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II. Weaknesses: The wholesalers, whom his company will work most closely, perceive his
business model as a way to take profits away from them because they do not see the need
to improve the current distribution process. Wanjohi needs to decide who will pay for the
service, multinational enterprises and mini-markets, wholesalers, or kiosks. Kiosks
benefit the most since they lose money when they have to close their shops to purchase
their produce. Multi-nationals and mini-markets have the most capital to pay for the
service, but also have better resources for their transportation needs to the wholesalers.
Wanjohi should demonstrate to the Multi-nationals and local manufacturing companies
why they should invest in his service; they will appeal to wholesalers better and have
vocalized their inability to effectively penetrate distribution in this area. Transportation
by bike is still time consuming and can be costly in terms of maintenance and replacing
bikes. With his current proposal, Wanjohi risks BSRs stealing revenue from him because
he does not have an electronic transaction system or a means to keep the BSRs
accountable and honest. Wanjohi’s track record as an entrepreneur and businessman are
lackluster; none of his previous projects have succeeded. As such, approaching the best
investors that can help grow the business and guide it into the right direction is
imperative.
III. Opportunities: Wanjohi’s target market, the unorganized “mass market” made of kiosks
hold 75% of the Kenyan retail market share, with 100,000 kiosks representing $115
million sales. This untapped market has potential for growth of Wanjohi’s company and
little to no existing competition. His business plan is unique since there is no pre-
established business specializing in shipment in the area. Also, many people avoid
starting companies there since it is full of corruption such as stealing and alcoholism. The

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infrastructure needs a service like KasKazi Network to make the distribution process
faster and to bring greater access of needed products to the rural region.
IV. Threats: Seen through his interactions with the wholesalers, people do not trust Wanjohi
or his business model because his company is unknown, and the service is not familiar in
the way it will function. Because quality, price, and are important in looking for products
and service, many people rely on “name” brands with years of experience to back up their
quality. As a result of the business model’s simplicity, imitators can easily enter the
market unless Wanjohi creates a process and service difficult to replicate.
STRATEGY
Instead of trying to talk with the wholesalers, who do not want to share their earnings
with KasKazi, Wanjohi should think about going directly to the multinational and local company

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manufacturers to offer up his business model. As stressed on pages 6 and 7 of the case,
wholesalers are unreliable for these manufacturers. Reliable demand, product turnover, and
honest payment are all issues that the manufacturers face when dealing with the wholesalers
(Schuepbach, et al., 6-7). However, we recognize that going to the multinational and local
company manufacturers in his current business state would not give Wanjohi enough leverage to
convince the manufacturers to discuss a possible partnership. Therefore, we recommend that
Wanjohi continue to build up his business and legitimacy before approaching the manufacturers.
To do this, the first step Wanjohi should take is to develop a transaction account book. By
keeping accurate transaction records and appropriate checks and balances, KasKazi would show
that it is serious about creating a reliable and organized business structure. Next, Wanhoji should
spend time choosing and training reliable BSRs to carry the manufacturer's’ products and make
sure the checks and balances are accounted for. Once these components are established, Wanjohi
can approach the manufacturers with a guarantee that KasKazi provides an organized business
structure for distribution of their products. We also recommend that he continue developing
relationships with the kiosk owners and emphasizing to them that his business model can save
them time and money, allowing them to be open while at the same time restocking their shelves
rather than having to close their shops for a day.
As pointed out in the case, BSRs can sometimes be unreliable and have nothing stopping
them from taking some of the profits for themselves. Developing a transaction record book
would help this problem, but to fully convince the manufacturers that his employees are reliable,
Wanjohi needs to think of proper training methods for his BSRs. To incentivize the BSRs to be
honest and responsible, they will travel in groups of at least three to keep each other honest about
the money they are receiving from the kiosks. If the profits to not align with the amount the

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manufactures expect, all three will be penalized. Traveling in groups will also help keep them
safer from individuals hoping to mug them and take their profits. Additionally, if kiosks try to rip
off the BSRs or take advantage of them, having a small group working together can ensure they
are treated fairly. By traveling in groups of three, the BSRs would be able to carry larger
quantities of perishable goods as well; thus reducing the number of total trips to the individual
kiosks and thus increasing efficiency. Depending on the success of the BSRs and the level of
their integrity, there would be the possibility to decrease the groups of three to pairs of two or to
individuals. This is the strategy we believe Wanjohi should go with to train his BSRs to be
reliable and responsible and to show manufacturers how he can alleviate their uncertainties of
product turnover and honest payment.
Part of the microenvironment that Wanjohi will have to take into account is the
consumers’ distrust towards unknown brands (Schuepbach, et al., 3). Even though the kiosk
owners would technically not be purchasing goods from Wanjohi, the fact that he would partner
with the manufacturers the kiosk owners are already familiar with and trust would incentivize
them to trust his business model and take part in it. We recognize that the bicycle model already
exists in Kawangware and that it would not be difficult to copy. However, by offering a unique
value proposition of integrity, organization, and convenience, we believe that Wanjohi and
KasKazi will continue to succeed.
ALTERNATIVE OPTIONS
Other alternatives could include hiring walkers as opposed to bikers. This would likely be
substantially slower, although it could potentially save money due to avoiding the issue
regarding stolen bikes, as well as the savings in bike investment. However, the slower
transportation would probably outweigh the savings of money, as it would likely cause

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perishable goods to spoil by the time they arrive to the retailer, and cause severe dry-spells in
certain product categories. Furthermore, Wanjohi could potentially use a transportation method
that uses vehicles as opposed to bikes, however this would likely not be possible due to the rough
terrains and lack of infrastructure to support vehicles, and stolen vehicle rates would likely be
very high due to the low income of the employees.
Wanjohi could potentially work with the wholesalers, however the example in the article
proved the unlikelihood of this option. Wholesalers do not want to give up any of their money,
and this causes a barrier that causes the wholesalers to not see the value in the service. This
would not be as beneficial as approaching manufacturers, using a method with channels higher
up in the chain that would not feel they are having their hard-earned money taken from them, and
would see the value in the service financially and efficiency-related.
Rather than attempting to break into an emerging market, Wanjohi could make an effort
to implement his idea on a mature market. However, mature markets often have their channels of
distribution matured as well, and this would be substantially harder to break into and require
substantially larger investment. Competition would be very strong in a mature market, whereas
competition in a developing market would be merely what is traditionally established, not
necessarily what is more efficient.
RECOMMENDATION
As discussed previously, our overall recommendation for Wanjohi would be to stop
pursuing relationship with the wholesalers and go directly to the multinational and local
company manufacturers and offer up his services. To be able to sell his business to these
manufacturers, he will have to first continue gathering data on the kiosks and forming
relationships with the kiosk owners, develop a proper and reliable transaction recording system,

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and hire and train responsible BSRs. Wanjohi should not be hasty when forming relationships
with the kiosk owners; the owners need to know that he is reliable and can deliver on his
promises. With KasKazi, kiosk owners can enjoy more profits by not having to close their stores
for multiple hours to get their goods and manufacturers can be assured that their stock levels and
money will be better managed than their previous relationships with some of the wholesalers. In
conclusion, KasKazi will be taking one of the first steps to improve the overall distribution
process in Kawangware and will hopefully enjoy much success working with large multinational
and local manufacturers that trust the business.
CITATIONS:
Schuepbach, Lisa Mwezi, Leif Sjoblom, and Winifred Karugu. KasKazi Network Ltd-
Distributing to the Bottom of the Pyramid (A). Case Study: IMD International, 2008. The Case
Centre. Web.