The Promotion Optimization Institute has found that 79% of consumer goods companies are not satisfied with their ability to manage trade promotions. Are you one of them? It’s probably because traditional trade promotions are no longer enough, companies need to do more but don’t know what or how to go about it.
Trade and Revenue Management is the next step in the evolution of trade promotions, it’s a framework that interconnects all the pricing and trade related activities within an organization.
Data, in this case results, is just noise unless you know what you are looking at or how to analyze it. With Trade and Revenue Management, you are able to take accurate, real-time data, and leverage it to make more informed decisions to benefit your organization. With this analysis you can truly understand the efficiency of your trade promotions and rebates, as well identify any unprofitable deals before they’re agreed to.
All too often companies are unable to make changes until the next promotion, which is like realizing you left the front door unlocked but your flight has already taken off. Trade and Revenue Management gives you the ability to change your promotions on the fly and make crucial adjustments to the promotional dates, volumes, and margins in order to maximize their profitability. real-time pricing, discount, and accrual data, keeps you in the driver seat. Being able to spot ineffective promotions or pricing imbalances and make changes in real-time reduces P&L leakages and improve margins.
Don’t become trapped by the common pitfall of trade promotion management, where you end up maintaining multiple trade or pricing systems. This can end up causing double payments, missed rebates, and increased rates of payback for invalid deductions. With Trade and Revenue Management, it means that you keep all promotions, deals, events, price lists, customer and/or vendor rebates, administrative fees, commissions, deductions and claims in a single system. This gives you a full financial picture that is always available.
It is hard to manage your business when you don’t have an accurate picture of your promotion or rebate profitability. By staying on top of your real-time revenue and/or expenses related to your promotions or rebates, you are able to eliminate the month-end or year-end surprises that come from over or under spending. This will allow you to allocate funds where they should be, which is growing your business.