The average retailer has seen an explosion of categories, categories within categories and segments within categories. As a result, space at the general retail format is now coming at a premium. Hence retailers are trying to maximise the return on investment from the limited display space.
A distributor or retailer today has to see value in how the DSR (daily sales representatives) meets his needs. With such a large number of SKUs, technology enables the DSRs to drive multiple brands across various channels.
Marketers are able to do an analysis of weaker performance areas and thereby take immediate steps to improve. Their credit mechanism has improved a lot and the marketers have absolute control over their debtors. A check on billing of debtors is possible and marketers can lock their billing if necessary.
Given the fragmentation of channels, its also become imperative for marketers to have their ears to the ground on aspects like replenishment cycles. For instance, at Food Bazaar Mattel toy car stocks are supplied twice a day within a gap of two hours. While the replenishment cycle has shortened, the plan on returns the product is generating has become a long term play.
Automation has helped ensure that right SKUs are available both at depot and plant location to service the market. Earlier, the sales forecast previously was mostly done on gut-feel of the regional manager. But with automation processes he goes down the detail of arriving at the sales forecast for his region with all the likely factors taken into consideration and with historical trends available.
The efficiency of projection has improved from around 60 % to more than 90% now. It’s not just efficiency of sales projections and stock replenishments where technology is lending a helping hand. Efficiencies on promotional costs can also be tracked using technology, on what’s working and what promotions are not delivering. It has dramatically helped to re-look at what promotions they run and how many they do run in a month. It has helped to bring down the level of expenditure on wasteful promotional expenditure and bring science and efficiency to promotions.
In Marico, the PDA is also being used by the sales person to show TVC’s / films during brand launches to the retailer making the entire process of the sales call more engaging. Technology is also coming of use when it comes to planograming within the store. Mattel has provided a planograming tool to its sales staff to make a visual presentation of how the product will look on the shelf particularly for the organised retail channel.
The three-dimensional visual tool combines the dimensions of both the product and retail store shelf to a give a virtual display. With such a tool, it becomes easier for the company to visually display how the balance stocks on the shelves looks. It makes the case convincing and selling becomes easier.
There are other examples of how initiatives at the frontline are also leading to changes in the entire cycle of sales and distribution. Godrej has realised the importance of tapping the entrepreneurial abilities of its sales force and initiated the ‘intrapreneurship’ concept for its sales employees. The concept of intrapreneurship was visualised to generate excitement among sales professionals.
On the other end of the spectrum is CavinKare which is employing people from rural areas as a part of its rural sales force to push brands like Chic shampoo and Fairever into the hinterland. A sales person from the urban areas will be all-at-sea managing the rural market. A native will reach the market using any mode of transportation. This horse-for-course strategy is enabling CavinKare to deploy its sales force optimally, depending on the channels.
The availability of the product at the right time is of utmost importance. So to achieve this, co-ordination between sales and distributors also becomes critical as the sales have information which is passed on to the distributors to enable replenishment.
The turn around time at the factory for a truck was 3-4 days and in some cases it extended to 5-6 days as well, but a process reengineering has been done for the truck movement in the factory and now the turnaround time for the truck is reduced to 24 hours.
Moving from a manual system of studying sales trends, targets and discussion, it’s now a continuous replenishment system, where stock levels are captured at each distributor, orders automatically generated and stocks are dispatched. An additional 33 per cent of the sales field force time has moved to the front end and is devoted to customer facing issues rather than manning internal company processes or managing the interface with distributors.
As the market evolves and the scenario becomes more competitive, every rupee saved by altering the system will add to the bottom line of brands. It is clearly evident that the re-engineering of the sales function is well underway in India and technology is playing a crucial role. One can therefore expect more initiatives which enable companies to drive sales better and faster. The next frontier will be to see what can be done with the ubiquitous mobile phone. But that’s still in a stage of infancy. This idea, however, might be just a step away from adulthood.