The consumer packaged goods industry shares your pain when it comes to managing vendor rebates easily and accurately. They too have long managed this activity manually, with spreadsheets that are often inaccurate.
There are a few similarities between problems faced by CPG distributors they have now found a solution for. Many of which are currently being experienced by distributors of Office products and Cleaning supplies
With suppliers in CPG adopting software to manage their rebates, so too are the distributors in this industry who need to protect their margins. CPG distributors have discovered that with software they can retain margin control, provide the most competitive price, and have visibility of past price comparison and padding.
For distributors of Office and Cleaning supplies, it comes down to being able to get the best estimate of true cost. In building the best estimate of the true cost, a distributor’s operating system needs to allow for a way to individually associate the cost of getting the product to the dock, the separately stated cost, and the cost of the product.
Unfortunately most do not. This is one area where distributors of Office and Cleaning supplies can reap the benefits from the similar problems CPG has resolved with software.
e-Commerce systems in the CPG industry have emerged rapidly and with them, problems managing pricing. With multiple access points, from online to sale representatives and catalogues, distributors have adopted pricing management software to update their pricing in real time and to keep all prices in sync.
For distributors of Office and Cleaning supplies who want to take advantage of e-Commerce and expand their product offering, they need a system to maintain the cost of “specials” that keeps all prices in sync regardless of their location. Adopting software to manage the cost of specials, means distributors can become more competitive with their product offering and potentially more profitable.
CPG distributors operate on tight margins and have learned that they need to be able to see the potential impact of an order, including the rebates that could be claimed. Spreadsheets are not able to manage this activity adequately meaning CPG distributors could be leaving money on the table and not adding it to their bottom-line.
To address this problem they have implemented software specifically designed to manage their vendor rebates and keeps their general ledger up to date and accurate.
For distributors of Office and Cleaning supplies, this type of software could also address problems with the generation of vendor rebate claims and ensures that all rebates are claimed for. It also reconnects rebate revenue with the associated transactions for profitability analysis.