Stakeholders

The biggest stakeholders in the Sodigaz model are the end-users and the distributors. The end-users create the market demand. Traditionally, end-users have been using charcoal to cook their food prior to the purchase of an LPG system. Their decision to switch to LPG is what creates the market demand and thus they are an essential stakeholder in the business. In addition, there are a number of competitors in the LPG market and the end-user's choice to buy Sodigaz brand is very important.

In order to reach the end-users, the majority of Sodigaz's sales are through distributors. Sodigaz works through 600 distributors. Each distributor manages, on average, 36 six kilogram bottles and a few 12.5 kilogram bottles. There are, however, a few distributors who manage over 1,000 bottles. Though they do not directly work for Sodigaz, they do indirectly represent Sodigaz to end-users and act as the intermediary between the two. Thus, the distributors are an important stakeholder for Sodigaz. The distributors also have a choice between LPG brands and their choice of Sodigaz allows for a larger reach throughout the country.

The government agencies, the Ministry of Energy and Ministry of Finance, also play an important role as the LPG market is heavily regulated through a subsidy for sales of 2.75 kg bottles and 6 kg bottles in order to cut down on charcoal use and prevent deforestation. Ninety percent of Sodigaz's sales are represented by those two sizes and thus this greatly impacts the company. It is the company's responsibility to collect the subsidy from the government, which can sometimes be delayed. This can create a cash flow issue. Thus the government plays a major role both in setting the subsidy and paying it.