Learning a New Trade

Even though a rising number of consumer goods manufacturers are investing more heavily in trade promotions, sales volume and profit from trade spending oftentimes does not yield a desirable return. With trade-fund budgets devouring an average of 10 percent to 30 percent of revenue, clear visibility into how the funds are distributed and how effectively they promote profitable sales is vital. New accounting and compliance regulations, including the Financial Accounting Standards Board (FASB) and the Sarbanes-Oxley Act, complicate matters further. It's no surprise then that consumer goods firms are making trade promotions management a top IT initiative. This year's Best-In-Class trade promotion winners all offer competitive solutions for different needs. Here's how the past year looked:

Milestones for Siebel

In February, Siebel Systems announced a new customer and the achievement of significant mile-stones for the Siebel 7 application family, the seventh major release of Siebel eBusiness Applications. With the signing of Heinz, more than 1,100 leading companies standardized on Siebel 7 for their enterprise customer relationship management (CRM) needs. With Siebel 7.5, organ-izations can take advantage of embedded business processes based on best practices in sales, marketing and service in an effort to boost superior customer experiences.

"We expect Siebel Systems to offer our field organization the best-in-class set of planning and trade management applications with which to provide better service to our customers and greater visibility into demand trends," says George Chappelle, vice president and chief information officer at Heinz.

Gelco's Customer Wins

In March, Gelco announced that the Worldwide Consumer Medicines Division of Bristol-Myers Squibb Company selected Gelco as a solution provider in support of its trade promotion management efforts. Gelco's fully Web-based Trade Management Solution offers trade promotion planning, deal tracking, analysis and reporting, and promotion evaluation. The two companies planned implementation activities immediately for launch by the end of the year.

In July, snack food manufacturer, Snyder's of Hanover selected Gelco's TMS Passport solution to support and manage its trade promotion management efforts.

Gelco's TMS Passport solution includes funds management, deduction management, payments, and analysis & reporting capabilities. TMS Passport is pre-configured to enable a fast implementation and quick ROI.

"We chose Gelco as our trade funds management provider because their TMS Passport solution met our needs for an efficient, cost-effective package, which we can grow with as our business expands," said Claude O'Connor, Snyder's of Hanover's vice president of sales & marketing. "Passport offers a shorter implementation time yet has robust trade promotion planning and management capabilities."

SAP's Evolution

In January, SAP launched SAP NetWeaver, the next evolution of its integration and application platform designed to provide extensibility across heterogeneous IT landscapes. NetWeaver enables organizations to integrate people, information and business processes across technologies and organizations and is designed to be fully interoperable with Microsoft .NET and IBM WebSphere (J2EE), providing customers with flexibility to manage heterogeneous infrastructures, minimizing complexity and reducing total cost of ownership. Thanks in part to SAP's June release of CRM 4.0, which includes a major trade promotion component, the company snagged new customers wins in 2003, including Colgate-Palmolive, Dial, Nestle, adidas-Salomon and Beck's.

Great Teamwork for CAS

In July, CAS teamed with Manugistics to create new solutions to the consumer products industry. The joint offering enables consumer goods firms to optimize pricing and promotions strategies, and maximize trade promotion profitability. In March, IBM and CAS, announced a strategic alliance to deliver collaborative business solutions to the consumer packaged goods industry. The IBM-CAS alliance aims to improve efficiencies between consumer products manufacturers, their retail customers and their broker and distributor sales networks.

MEI Delivers

In January, MEI delivers the Consumer Goods Suite for small and medium-sized manufacturers as a pre-configured solution in an effort to minimize delays and unnecessary expense. The Web-based Consumer Goods Suite provides functionality for CG manufacturers to forecast sales and budget trade spending, manage account planning and promotion activities, establish and execute against store level retail objectives and manage payments and deductions. In August, MEI says its Consumer Goods Suite will include tools designed to help clients comply with new accounting requirements set by the Sarbanes-Oxley Act. In October, MEI announced a partnership that combines the power of its MEI Trade Promotion Management Solution with the state-of-the-art promotion modeling technology from Demantra Inc. The MEI Consumer Goods Suite includes the ability to measure and simulate the true impact of promotions in order for manufacturers to determine the "net lift" of promotions.

Synectics Sees the Power of Cheese

In April, cheese maker Sorrento-Lactils announced that it selected Synectics Group's Account Review software to manage its trade promotion spending and in August, Sargento Foods Inc., a manufacturer of shredded, snack and specialty cheeses rolled-out the Account Review closed-loop trade promotion application. Other account wins for Synectics in 2003 include Kozy Shack, Litehouse Foods and Florida Natural Growers.