Unsaleables – More Aggressive Policy Enforcement – “One Bucket” Budgeting Concept”
For those manufacturers tired of fruitless policy dialog with insincere trading partners who charge abusive pricing/fees as a matter of practice and/or operate with a “profit center” mentality for reclaim, alternative treatment of marketing funds and unsaleables claims may be appropriate. Namely:
- Bundle the funding of Trade Promotion funds and Unsaleables conceptually where retailers charging in excess of policy would lose trade funds in the amount of their abuse.
- A “carrot” may be added to the above “stick” whereby those abiding by policy and striking a targeted unsaleables rate may earn added trade funding.
- Management Reporting to support such a program is of course a byproduct of our audits, and are a great way of enforcing policy while we continue to work on more productive aspects like the causal aspects for claims and working down the volumes.
- The more aggressive approach would also factor in abuses on the spoils % of sales/volume side reducing trade funding for retailers employing “broken business practices” with volume of claims far in excess of normal.
We can move these dialogs to the background and to administrative areas of the company while leaving sales and logistics to concentrate on growing their business profitably by focusing on customer profitability.
