VIVO Mobiles Distribution Network

University of Sahiwal

Department of Business Administration

Supply Chain Management

Submit To……..

Ma’am Sana Tariq

Submit by………

Group Members Roll No’s.

1. Kashif Raza MBS-15-32
2. Aamar Hanif MBS-15-30
3. Muhammad Ismail MBS-15-37
4. Ali Nawaz MBS-15-61
5. Muhammad Tayyab Mubeen MBS-15-09

Class…………… MBA (morning)

Semester………. 6th

Session………... 2015-18

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Dedication

We would like to dedicate this project to our parents who has given us opportunity to study
here in University of Sahiwal, and to our respected teacher who has given us a chance to
work on this project.

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Contents

Acknowledgement……………………………………………………………………………..4

Introduction ................................................................................................................................ 5

Distribution channel structure .................................................................................................... 8

New concept stores: ................................................................................................................... 9

Franchisees:................................................................................................................................ 9

Rural market distribution: ........................................................................................................ 10

Other distributions in Pakistan:................................................................................................ 10

Channel distribution for GSM handsets:.................................................................................. 10

Channel distribution for CDMA handsets: .............................................................................. 11

Activities of channel member: ................................................................................................. 12

Interview with HOTSPOT mobile distribution member: ........................................................ 14

Conclusion: .............................................................................................................................. 15

References ................................................................................................................................ 16

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ACKNOWLEDGEMENT

Working on this report on “Vivo Mobiles” was a source of immense knowledge to us. We are
thankful to Almighty ALLAH “most beneficent and the most Merciful” Who made us able to
complete our given project successfully and for giving us much cooperation and supporting
parents who has given us this opportunity to study here. We acknowledge with a deep sense
of gratitude, the encouragement, inspiration and valuable time received from our faculty
members, our colleagues. We would like to thank Ma’am Sana Tariq for giving us the
confidence and opportunity to prove ourselves.

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Introduction:
Distribution (or place) is one of marketing element in marketing mix and hence designing a
distribution Network for a product is very important aspect for any company’s product. The
success of the channel design will be declared as the product is readily available at ease for
the consumers.

Here we as a group have chosen the VIVO mobile company for doing this assignment. The
company established in 2009 having its foundation in Dongguan, Guangdong. Vivo is one of
the leading mobile communications in the world, it has 14 manufacturing plants throughout
the world and they have 100,876 employees. The company owns R&D centers in Dongguan
and China. Vivo first began making Smartphone’s in China in 2009. We were registered in
over 100 countries and regions worldwide, choosing the path of internationalization and
never looking back. With introducing of the X5 Max, we created the worlds thinnest
Smartphone, demonstrating our commitment’s to becoming an innovator in the industry and
pushing the boundaries of amazing design. Vivo mobile industrialized company plays a
major role in Pakistan and have huge market share than other players. They have started its
process in Pakistan in 2017 and have their offices in major cities like Lahore, Karachi,
Multan, Peshawar, Faisalabad, and Islamabad. They have increased their man power from
850 people to 15000 from the year of 2017 to 2018. And also they have targeting all class of
people by releasing different kind of mobiles with different features. China started mobile
services in 1988 whereas, Pakistan started mobile services in 1995. By 2001 Pakistan
exceeded China’s growth rate in mobile services. This shows how the distribution channels of
the mobile companies working in Pakistan. Here in this report we are trying to bring out the
efficient network of distribution addressed by Vivo in Pakistan.

Vivo Pakistan has promoted Mr. Fraz Malik Khan as Deputy General Manager of its Device
department. The leading technology company Vivo has acknowledged the competent
performance and managerial expertise of Mr. Fraz Khan, to entrust him with these important
responsibilities, to drive the strategic development and planning functions for the world-
renowned brand in Pakistan.

Vivo is a global smartphones manufacturer with production facilities and R&D centers in
China (Dongguan, Shenzhen, Nanjing, Beijing, Hangzhou and Chongqing), India, Indonesia
and the United States (San Diego). Over the years, Vivo has developed smartphones markets,

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with presence in China, India and Southeast Asia (Indonesia, Malaysia, Vietnam, Thailand,
Myanmar and the Philippines). In 2017, Vivo will further expand to regions like Hong Kong,
Macau, Taiwan, Southeast Asia, South Asia as well as the Middle East.

Air-link communications, M&P and inovi Technologies are the official distributor partners
of Vivo mobile in Pakistan.
Tech Sirat & GreenTech is the official distributor partner of Vivo Mobile in Pakistan.

Staff Overview:

>40,000 total employees

Average age 29
Youngest Director Age 29
Youngest Manager Age 23

Products of Vivo Mobiles:

1. Vivo V7
2. Vivo V7+
3. Vivo V9
4. Vivo V5s
5. Vivo Y53
6. Vivo Y27
7. Vivo Y25
8. Vivo V7plus
9. Vivo X5

Smart Technology:
At Vivo we believe that your technology should understand you, and we’re committed to
being at the forefront of innovation, and continuously providing practical features that make
people’s lives easier. Whether it’s our user friendly, easy to use, Funtouch OS, our original
Smart Wake function, or our camera’s innovative Voice Shoot for convenient voice-activated
snapshots, we believe that it’s the smallest details that make the biggest difference in our
busy lives.

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Looking Towards the Future:

We are a young company that believes that people should be at the center of technology. For
Vivo every challenge presents an opportunity for innovation and every breakthrough is
another step closer to perfection. We believe that every great change is only possible with
professionalism and dedication. Daring to pursue the ultimate perfection while continuously
creating the surprising.
VIVO, a renowned Chinese technology brand started manufacturing smartphones in 2011.
Before this the company specialized in feature phones and telephone handsets.
According to the sources, VIVO, China’s third most popular smart phone brand, is all set to
launch in Pakistan on July 5th, 2017. It is ranked 5th globally with over 80 million sales in
2016.
According to International Data Corporation (IDC) Q3 2016 stats, Vivo was second leading
smartphones player in Chinese market having 16.7% market share.
Pakistan, with 136 million annual cellular mobile phone users, presents an ideal landscape
for all mobile companies. That is why both old and new players are desperate to enter to
Pakistan.
VIVO has launched three smartphones in Pakistan that offer top notch hardware
specifications, perfect selfie cameras and a smooth user experience with Funtouch OS.
These devices, namely the V5S, Y55S and Y53 are now available in all major cities of
Pakistan, through Vivo’s own distribution network.

Working Culture:
Vivo is a warm and welcoming big family with young and aspirating employees. We focus
on actions, not hierarchy. All employees are allowed full freedom and space to develop
themselves.

Corporate Culture:
Vision:
To become a healthier, longer-lasting global corporation.

Core Values:
BENFEN, Integrity, Team Spirit, Superior Quality, Constant Learning, Innovation,
Consumer Orientation.

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Mission:
To Consumers: Provide quality products and superior service.
To Employees: Create and maintain a harmonious, respectful work environment.
To Business Partners: Create a fair, equal cooperative platform with mutual benefits.
To Shareholders: Render above-average returns on investment.

Working Environment:
Our office environment is comfortable with a full range of facilities. From employee cafe
with delicious food and pleasant atmosphere, to spacious basketball court, modern gym, table

tennis room and pool tables, we provide every possible convenience for you to enrich your
life at Vivo.

Achievements of Pakistan:

 They have come up with Wi-Fi mobile which is called Vivo communicator in 2018
 In 2018 this company has started huge mobile distribution in Pakistan.
 Vivo Company has joined with UC browser to launch first Pakistani mobile News.

Distribution channel structure:

Vivo manufactures its mobile in Dongguan, Shenzhen, Nanjing, Beijing, Hangzhou and
Chongqing manufacturing plant and then it transfers to Vivo mother depot which is located in
Lahore, Air-link communications, GreenTech will start distributing Vivo product from here
on. Air-link communications, GreenTech takes order from all the distributers in the region

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and then it supply the product to the retailers with the help of RDSS (Re-Distribution
stockiest supplier). RDSS are further divided in to two types based on quantity distributed
and geographic nature as RDSS city and RDSS MD (Micro Distributers), RDSS city caters to
large cities and supply directly to the retailers whereas RDSS MD will supply to its micro
distributers to carter small towns and through them it will be supplied to retailers. The above
mentioned distribution channel structure of Vivo – Air-link communications, GreenTech is
restricted to north and east part of Pakistan. For west and south Pakistan Vivo has developed
its own distribution channel which takes responsibility of transferring handsets to end users
apart from that Vivo also takes responsibilities like recruiting sales force, training and
developing. Stock norms of Vivo- Air-link communications, GreenTech says that how many
days stock should be maintained in each level of distribution in the supply chain which are as,
HCL – 7, RDSS city – 5, RDSS MD – 4 and MD – 3. Anything below this number of days
would be replenished immediately to avoid stock out. The expected target to fulfill the stock
level can be determined by the formula (30/number of working days)* stock norm for that
level. (Handset distribution business — Air-link communications, GreenTech Info, Vivo in
new 5-year deal, 2018)

New concept stores:

Vivo rolled out its new channel distribution as Vivo concept store. The shop provides one
stop solution for mobile users to give away the opportunity to experience the desired mobile
in the outlet before purchasing the same. These stores would have wide range of Vivo
mobiles along with mobile enhancements also. The new concepts had launched new branding
which was extended to other Vivo retailer and other multi-brand shops. These concept outlets
will help in reducing the distribution cost and transportation cost. These concept outlets are
opened only in metros and large cities which bring out exclusivity towards the brand.

Franchisees:
Vivo franchised its brand exclusivity in the name of Vivo Priority Dealers. All the outlets
which are under the franchiser should follow certain footfalls of the franchiser’s company.
This would include converting a normal outlet into Vivo Priority Dealer outlet. But the
franchiser will help in visual merchandising and loan for deposits which are refundable.

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Rural market distribution:

Vivo did not concentrate more on rural market as the products are widely used in urban cities
but due to competition in the market Vivo planning to venture in rural marketing along with
the concept of micro financing for its product which would help in covering high market
share. Vivo planning to leverage the distribution network in order to expand to rural sectors
and to serve untapped market. The company planned to educate the benefits of its mobile
towards the villagers.

Other distributions in Pakistan:

Apart from its Vivo concept stores, the company distributes its product to many multi-brand
mobile stores which are well known in Pakistan for their service and price discounts. They
are
Hotspot: It is ranked as the number one outlet for its wide collection of mobile of all range
and also for good after sales service. Apart from handsets, it also sells mobile accessories,
mobile network connections, recharge vouchers and gaming device.
Univercell: It is considered as the highest selling outlets among the other mobile retailers in
Pakistan. This is because of their service flexibilities like online shopping, door delivery, and
after sales service.
The mobile store: It is a recently emerged mobile outlet which is also well known for the
wide range of mobiles and its enhancement product along with the well known repair center
insides it’s each outlet. Recently the store had won award as “most wanted mobile retailer” in
Pakistan.

Channel distribution for GSM handsets:

The handsets are transferred from Vivo Dongguan, Shenzhen, Nanjing, Beijing, Hangzhou
and Chongqing manufacturing center to Lahore mother warehouse and from there it is
supplied through Air-link communications, GreenTech distribution network to north and east
part of Pakistan. Air-link communications, GreenTech distributes to its regional distributors
and from them to RDSS city and they will supply directly to the retailers but in the second
channel called RDSS MD first, they will receive and send it to micro distributors and through
them the handsets will reach retailers and then to its customers.

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GSM handset distribution structure:

Vivo mother warehouse

GreenTech Distributor

RDSS MD RDSS City

MD MD Retailer

Retailer Retailer

Channel distribution for CDMA handsets:

The distribution system for CDMA will be little different from GSM as there is a need for
SIM from the mobile network operators. The CDMA handsets are manufactured and send to
Vivo mother warehouse located in Lahore. And then from there it is delivered directly to the
mobile network operators of Pakistan. There they will assemble their respective mobile
network’s SIM card and then send it to its own operators’ outlets and large distributors. The
large distributors will further transferred to agents, chain of stores, etc. and finally it will
reach the end customers. Vivo has a tie-up with Jazz network and Zong network for its
CDMA handsets.

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CDMA distribution structure:

Vivo mother
warehouse

Network operator

Large distributors

Mobile store, Network owned

Agents and Dealors oulet s

Activities of channel member:

Vivo owns the distribution centers in west and south of Pakistan but, in northern and eastern
part of the country Vivo distributes its products through Air-link communications,
GreenTech. Air-link communications, GreenTech has served the customers as a partner of
Vivo for more than 10 years. Air-link communications, GreenTech consist a large part of
Vivo services, it has its centers in more than 180 cities, and these care centers are owned and
are operated efficiently by Air-link communications, GreenTech, the operations of Air-link
communications, GreenTech is limited only to north and East Pakistan only.
The mother depot of Vivo is in North Pakistan in Lahore, all the high end sets which are
imported and all the sets which are manufactured in Karachi are transferred here first.

As we mentioned in the distribution channel diagram as how the distribution is handled by

Air-link communications, GreenTech in Punjab, the stock will transported from Lahore to a
small center in Punjab which is owned by Air-link communications, GreenTech.

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Air-link communications, GreenTech will receive orders from various distributers in the
region, after taking the orders the RDSS will take care of the further flow in the supply chain,
this is how the retailers receive the product.

As the RDSS is divided in to two parts, the RDSS-city will distribute the products directly to
the retailers in the region then, the RDSS-MD will take care of the regions outside the city
and small towns.

Firstly the products will be distributed to the micro distributes and then the micro distributer
will distribute to the retailers in small towns and places outside the city, by this way they are
trying to supply the demanded quantity to smaller towns and remote location.

This is the same format used by Air-link communications, GreenTech in all states of north
and East Pakistan. In the regions where HCL does not operate Vivo outsources some other
regional distribution company and this company holds all the responsibilities to appoint a
sales force and take care of other requirements of the distribution channel. This outsourced
company reports to Vivo’s Area Sales manager. They have Regional Manager’s for north,
south, east and west part of that area, for each part there are three to four Regional sales
manager and one area sales manager per state, the area sales managers are segregated on the
basis of up market and a sales force.

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Table of Management structure for Vivo channel distribution:

Regional GM (one each

for N, S, W & E)

Regional sales Manager

(3 to 4 in every region)

Area sales mangers

Sales forces

Distribution structure for Vivo 2018

Interview with HOTSPOT mobile distribution member:

Hotspot mobile retailer is considered as a leading multi-brand mobile store in Pakistan for its
wide range of varieties and mobile enhancement spares. The owner of HOTSPOT mobile
store Mr. Ahmed Ali says, “The store gets its supply for many brand like Vivo, Huawei,
Samsung, Motorola and many other but the Vivo is the best brand whose supply is
appropriate in nature which helps in saving cost on inventory”. After a detailed interview
with him, we found out the following positive and negative aspects relationship between
Vivo brand manufacture and HOTSPOT dealers. They are
Positive relationship aspect:

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1. Vivo had chosen Air-link communications, GreenTech as its distribution partner which is
well known for its largest redistribution points in Pakistan; hence the product delivery
is flawless and
2. The capital, logistics and business information are provided for time to time operation
period which helps the company to improve its operation.

Negative relationship aspect:

1. The main negative aspect is that the Vivo is not concentrating more on tapping rural
market which restrict the retailer to open up a store in rural premises and
2. The company had chosen two different channel distribution systems based on CDMA
and GSM handsets model which brings a differentiation in handset receiving time and
also the retailers need to maintain two different suppliers profile. Distribution
structure of Vivo mobiles.

Conclusion:
Finally, our team had found out that the distribution system of VIVO Mobiles is well
designed and properly structured for both CDMA and GSM model handsets in Pakistan. The
company’s distribution system is strong in north & east part of Pakistan as it is taken care by
Air-link communications, GreenTech distribution and also efficient in south and west part of
Pakistan as it is taken care by Vivo itself. The company is planning to increase its market
share by covering up rural market through expanded distribution network. The company is
also planning to come up with micro-finance idea for its handset purchasers. And our
recommendation for the company is to maintain the existing distribution network and to take
measure for filling the time gap between the CDMA & GSM handsets’ product delivery time
to the retailer.

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References:
1. Consumer durables. (n.d.). Retrieved 15 March 2018, from Naukrihub:
http://www.naukrihub.com/Pakistan/consumer-durables/companies-list/top-
players/Vivo/

2. Distribution Agreement for Vivo. (2008). Retrieved 18 March 2018, from Forum
Vivo: http://www.forum.Vivo.com/info/sw.vivo.com/id/674508ed-ab06-40e4-8bc5-
b1189c2b492c/Vivo_PC_connectivity_solution_distribution_agreement.pdf.html

3. Distribution Structure of Vivo. (2018). Retrieved 22 March 2018, from

Siliconpakistan: http://www.siliconpakistan.com/shownews/ Air-link
communications, GreenTech _Info_vivo_in_new_5_year_deal-nid-31038.html

4. Handset distribution business — Air-link communications, GreenTech Info, Vivo in

new 5-year deal . Retrieved 24 March 2018, from Thebusinessline:
http://www.thebusinessline.com/20018/02/21/stories/2006022102340400.htm

5. Vivo - Air-link communications, GreenTech. (n.d.). Retrieved 10 03, 2018, from

Hclinfosystems: http://www.hclinfosystems.com/hcl_vivo.pdf

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