Ep. 3 – Volume Forecasting: How CPG Manufacturers Can Escape Spreadsheet Hell

Ep. 3 – Volume Forecasting: How CPG Manufacturers Can Escape Spreadsheet Hell

Today, Doug Louken, a veteran of the manufacturing industry and a refugee from spreadsheet hell, is going to share how CPGToolBox’s Volume Forecasting feature can speed up and optimize an otherwise mind numbing process.     In CPGToolBox, there is a baseline, and we have produced lift indexes to figure out or calculate what the incremental value is for an individual event on a SKU by SKU and week by week basis. When you have base units and incremental units, you have what is called a consumption forecast. As CPG manufacturers know, however, a consumption forecast does not necessarily translate into a shipment forecast. We have put in an LE process, or latest estimate forecast. This process looks at all of the activity that’s in the house (your actual sales and actual spending), and combines that in one field with your planned or forecasted or future events. The result is one number that can serve as a great barometer for your forecast; the dollar sales or LE units or LE spend will give you a very clear picture of where you’re going to end the year. On top of that, there is also something we call a Coverage Pattern. So if your consumption forecast says you’re going to sell 100 units, we all know that your shipment will probably be somewhere near 110 or 120 units to support the 100 units of consumption. Basically, your forecast number might be higher than your consumption number. To improve your forecast, CPGToolBox gives you the ability to lag those numbers. A distributor may have a longer lag time than a direct chain,...
Ep. 2 – Trade Planning: Interactive Calendar vs. Spreadsheets

Ep. 2 – Trade Planning: Interactive Calendar vs. Spreadsheets

Why should CPG Manufacturers build and manage trade promotion on an interactive calendar?     When you put your planning data into a system, it’s quicker, more organized, and more easily inputted than a spreadsheet – but, more important than all of that, it is broadly visible to the various departments within the organization that need that information. Ease of Use – As a user, all you have to do to start planning is plug in or link the relevant information. After that information is in the system, it is applied to all of your business and promotional plans. Plus, when a retailer’s plans change, as they frequently do, it only takes a couple clicks to adjust the calendar. ROI on the Fly – A cloud-based system allows you to aggregate data points from many different places (retailer, POS, IRI data, distributor spend data, etc.) and plug all of that information into the tool, and into a planning calendar, that gives you metrics back very quickly to understand how successful or how efficient your spending was on a particular event. Visibility – When you’re planning on a spreadsheet, you’re disconnected from other components of the process (such as target management, which we discussed during the last episode). A cloud-based system can link everybody together, from the top down, and allow them to see the same information updated in real time.   An interactive calendar simply makes the whole process of communication, planning, evaluating, and adjusting much faster and much more open. This will help organizations make the best decisions possible, in the last amount of time. No matter what,...
Ep. 1 – Target Management, Trade Planning, & The Cloud

Ep. 1 – Target Management, Trade Planning, & The Cloud

75% of CPG manufacturers still track their trade promotion activity on spreadsheets. If you’re a CFO and you’re watching that, you probably have a great deal of nervousness. You might have two or three hundred million dollars in the fields tracked on a spreadsheet, and the possibility of error is significant. However, new technology offers better solutions to these old problems. By leveraging the power of cloud processing, you can speed up, simplify, and optimize Trade Promotion Management. Manually populating spreadsheets with accounts and formulas, and keeping those spreadsheets up to date as things change, takes a lot of time. After that time-consuming process is over and the spreadsheets are accurate, that information is handed off to account managers, who are often working with brokers. As a result, you start to lose visibility and transparency. By the time the project manager pulls all of that information together, the data isn’t very accurate and you wasted a lot of time. Using a cloud-based TPM solution, all of the necessary data can be populated in seconds. That information can then be pushed down to other account managers and brokers, and even the individual authorized projects in each of those accounts, based on an historical sales periods’ percent of control. Because everyone is in the same system, there is parity at every step of the process. The system also builds out a promotional calendar for everyone involved. It ties the funding, locks the funding for those individuals that do the planning, and allows them to tie back allocations of dollars once they plan a specific trade event, which adds an additional layer...