Taking Action May 2004

It is common practice for manufacturers and distributors to have access to mountains of promotional and point-of-sale data, but few companies look outside of the box and assume an active role in developing and reshaping technology tools to better fit the information needs of their unique business. Hensley & Company, an Anheuser-Busch wholesaler, is one such company that has continually positioned itself on technology's cutting-edge. Since the early 1990s, Hensley has partnered with Salient Technology to customize and initiate the development of solutions to optimize sales processes and improve its bottom line.
The Phoenix, Arizona-based Hensley & Company was founded in 1955 as an exclusive Anheuser-Busch wholesaler. With its 50th anniversary on the horizon, the wholesaler now employs over 600 people -- a far cry from the 100 employee base that existed when Mark Miller, Hensley's VP of sales, first joined the company in 1978. "We sell approximately 22.5 million cases a year," says Miller, "which makes us the second largest Anheuser-Busch wholesaler."

Divide and Conquer
In 1994, Hensley reorganized its sales system to be both team-based and channel-based. Essentially, each team runs a mini-wholesalership, exercising jurisdiction over the sales and delivery processes for a specified customer base such as grocery or convenience retailers. After learning of a Salient product called Margin Minder from a publication, Hensley wasted no time investigating and later purchasing the sales and revenue management system.

"Initially, Margin Minder was a product developed for the soft drink industry," says Miller. "We were one of the first or second beer companies to rely on the software."

Due to the differing measurements between the soft drink and beer industries, Hensley helped Salient to develop a tailored version of Margin Minder that could recognize the beer industry's case and barrel equivalents.

Despite some initial tentativeness from the user population, Hensley's sales teams warmed up to Margin Minder's functionality for pay for performance (PFP) and distribution within a year of deployment. Initially, Hensley had about 20 or 30 users trained on the solution. Usage later exploded in the late 1990s and, right now, Hensley has close to 200 people trained on Margin Minder.

Minding the Store
Based on the success of Margin Minder, Hensley decided to enlist Salient to deploy another solution called Store Minder, which houses all of Hensley's product and pricing information, as well as retailer PTCs. "With Store Minder, Hensley is able to give the store a good look at profitability," says Miller. "For example, if we went to a convenience store, we know what the retailer purchased from us, and with retail plugged in, we can give the store a good estimate of its profit on our products."

At this point, 66 percent of Hensley's total business is chain driven as alcohol consumption has shifted over the years from primarily on-premise to more off-premise purchasing. While Margin Minder gave Hensley a good look at its internal business, it did not accommodate external data, such as scanning numbers from chain stores. In the new world of information-based category management, Hensley wanted to offer its chain accounts the same type of fast accurate analysis for the entire beer category. "We needed category management tools that could move beyond housing information and handling profitability for just our products and encompass a retailer's entire product portfolio," says Karla Dooley, category analyst for Hensley.

To gain visibility into activity at the check-out counter, Hensley required a program that could accept and quickly analyze chain-supplied numbers. Once again, Hensley called upon its familiar partner Salient, which then custom-developed a tool called Category Minder for the wholesaler.

This program organizes retailer scanning data in a fast information system that shows exactly what is going on in the store, offering a clear view of profitability and trends for the entire category.

Tracking Technology
While considering Margin Minder, Store Minder and Category Minder to be strong and effective tools, Hensley still tracked components such as displays, pricing and product location with separate Excel or Access databases. During a service call, Salient shared its plans for an enterprise management system called Salient UXT (Universal Exchange Tracking) with the wholesaler. "It seemed like the answer we had been looking for," says Dooley. "We decided that Hensley wanted to be the beta test for UXT."

Acknowledging that sales decisions affect service costs, marketing decisions affect purchasing and manufacturing decisions affect margins, UXT was designed as an integrative data engine to bring sales, distribution, HR, marketing, manufacturing, service and purchasing facts together, resolve them and then explain them in an easily understood enterprise-management environment.

Hensley purchased UXT and went live with the system in November 2003, focusing first on its sales capabilities. With UXT, Hensley receives in-store display coverage everyday. UXT is also helping Hensley keep track of other causal data -- or what Salient calls non-transactional data. UXT capabilities now allow Hensley to track promotion performance at the point of sale and measure the effectiveness of newspaper advertisements and in-store specials. "We monitor the entire market, both competitive and Anheuser-Busch," says Miller. "We know at any given time what the in-store pricing is for each week and can relate that to sales down to the package level at every account."

So far, UXT has been well received at Hensley. Whereas Margin Minder faced user reluctance in 1994, Hensley's sales organization is anxious to use UXT to gain exact information that will help better manage its challenges. Individual and team PFP goals, such as increased display or ad percentage, product distribution, taps handles and shelf space can be monitored quickly and accurately.

"Salient has been a great partner," says Miller. "I am sure there are a lot of other comparable products on the market, but as far as speed, this is the fastest most incredible tool you can find."