Services & Solutions

Increase return on promotional spend

Trade promotions can make up as much as one-fifth the profit or loss in fast-moving and consumer goods organisations. Retail promotional sales, in particular, can have a huge impact on the bottom line. So, improving the management of promotional spending is essential. But the real challenge lies in aligning commercial and financial drivers with optimal supply chain execution.

Why is Trade Promotion Management (TPM) an ongoing challenge for consumer organisations today?

• Administrative inefficiencies: Maintaining multiple forecasting, promotional and pricing systems requires duplicate data entry, leading to inaccuracy and extra administration.
• Data inconsistencies: Individual promotions, forecasts, accruals, claims, payments and reporting systems lead to inconsistencies in management information.
• Poor decision-making: Time-intensive, error-prone data management processes make gaining visibility of a promotional deal, its profitability, volumes and redemption, difficult.
• Lack of management control: The effect of poor financial and management procedures, particularly around authorisation and settlement, can negatively impact returns.

When eight-figure trade fund budgets are the norm, SAP Trade Promotion Management can dramatically improve costs, spending and returns by managing end-to-end promotions processes. This includes from internal and external, disparate systems at each step of a trade programme lifecycle.

Effectively manage trade promotions that increase brand equity and achieve sales objectives

With integrated trade promotion management, organisations can have complete visibility into trade promotions spend at each stage of their life cycles. This enables them to better manage trade funds, collaborate effectively with retailers, analyse promotion activity and determine ROI.

Improve the effectiveness of promotional spend

• Increase management control and allocation of trade promotion budgets.
• Effectively measure promotional success and planning accordingly.

Reduce promotional costs

• Streamline back-office administration to strategically empower account managers.
• Reduce planning effort for account managers to give them more time to sell.
• Capitalise on demand through better supply chain and commercial communications.

Improve cash flow

• Reduce errors and associated administrative effort, as well as their potential negative impact on cash flow.
• Improved claims and deductions handling with accurate first-time data capture.

SAP TPM solution scope

• The SAP TPM solution fits across SAP CRM for promotional planning, as well as creating and managing funds, and validating and approving claims.
• The forecasting capabilities of SAP APO can be use to create baseline used in the promotion and the forecast is adjusted with the proposed volume uplifts. ERP is used for back office processing, sales and billing use the off invoice discounts and generate the rebate values. Payments and disputes are processed in FI following the deductions claimed by customers.
• Planning applications in SAP's Business Warehouse hold data used for calculating the potential profitability of the promotion and validating the result. The same master data is used across the integrated solution for a truly integrated enterprise wide solution.