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Implementing a trade promotion management system is crucial for Consumer Goods companies to survive in the competitive retail landscape. However, the path to a successful TPM software implementation can be challenging. In this guide, we'll explore the key aspects and steps to ensure your CPG business successfully implements a trade promotion management system.
In the most recent POI survey, only 16% of GPC companies said they were satisfied with their ability to manage trade promotions. 16% - satisfaction with the ability to manage the second largest spend line in most CPGs.
A Trade Promotion Management (TPM) system becomes imperative for a business when it encounters several key triggers. Legacy systems may no longer be sustainable due to limitations in patching, and as the business grows in complexity, existing systems may struggle to accommodate all the necessary factors.
Increased sales, wider distribution networks, and higher spending requirements can necessitate the accuracy, collaboration, transparency, and accountability that TPM provides. An unsuccessful audit can also serve as a compelling reason to adopt TPM.
Furthermore, as an organization expands, the involvement of multiple teams and complex processes can outgrow the capabilities of manual systems like Excel and Google Sheets. Signs such as heavy reliance on numerous spreadsheets and processes indicate that it's time to implement a TPM solution.
To identify the right time to implement a TPM solution, consider the following:
You may also be interested in how Fruit of the Loom boosted its TPM with CPG.
Before embarking on the implementation journey, it's crucial to ensure your organization is ready for the change. Follow these steps:
Once you have enough data to make a decision, here's what you must do to ensure successful implementation.
Selecting the right TPM vendor is crucial for a successful implementation. Tailor your approach based on your business goals and needs, and work closely with your chosen vendor to ensure a smooth transition. Here's what to keep in mind:
With many potential partners out there, selecting the right TPM vendor can be a heavy task, but a well-defined process can make it smoother. Follow these steps:
Quantifying the benefits of TPM adoption and convincing stakeholders of its necessity is key. Use the following facts to build a compelling business case:
Finance departments have become central to trade spend projects, taking on the responsibility of closely monitoring and managing expenditures, down to the account, SKU, and week levels, thanks to advanced trade promotion management solutions. In contrast to traditional brand-level trade spending tracked with Excel formulas, these solutions provide a more profound financial understanding, facilitating ROI analysis, assortment optimization, and accurate accruals to the general ledger.
However, conflicts can arise between sales and finance departments due to differing objectives. While finance aims to ensure profitability, efficient spending, and proper accounting for deductions, sales may prioritize autonomy in fund allocation. Despite resistance, implementing comprehensive trade promotion management systems can potentially boost the bottom line by up to 10%, aligning the goals of both departments and promoting greater efficiency and financial viability in trade promotions.
User adoption is key to the success of your TPM system implementation. Prepare your team for the switch from spreadsheets to software by actively communicating the benefits and defining success.
After the TPM system is implemented, focus on continuous improvement and ongoing user support to ensure long-term success.
Implementing an effective Trade Promotion Management system in your CPG company is a strategic move to streamline trade promotions, enhance financial understanding, and drive profitability. By following these comprehensive steps and collaborating with the right TPM vendor, you can ensure a successful implementation and long-term success in the competitive CPG industry.
CPGvision is a best-in-class, fully connected, and integrated TPM, TPO, and RGM solution suite for Consumer Packaged Goods, built on the Salesforce platform. With the most advanced functionality in the industry, CPGvision equips you with real-life problem-solving applications for TPM, TPO, and RGM.
Your success is our success - CPGvision proudly provides a dedicated customer success team staffed with CPG industry professionals. Regardless of where you are in your RGM journey, you’ll be fully equipped with the solutions you need for profitable revenue growth. Contact us today for a consultation.
Here at CPGvision, we have developed an implementation methodology that takes all of this into account and ensures the successful implementation of our solutions.
The key parts of our successful methodology are:
Bringing your trade promotion process into the 21st century with our advanced solutions is an important step in ensuring business success. By employing the right TPM software, you are better positioned to meet the challenges of trade promotion management and craft a distinct advantage in the ever-competitive world of the consumer goods industry.
Find out how CPGvision has implemented its TPM solutions at many CPG companies to address these shortcomings. Get in touch with our team of experts and let us help you avoid failed TPM implementation.
What factors lead to Trade Promotion Management process failure?
Here are some possible factors that can contribute to failed TPM implementation:
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