Oracle E-Business Suite: Eliminate Promotional Fund Management Headaches with Channel Revenue Management Kathy McAndrew Master Principal Sales Consultant Oracle Corporation March 6, 2015
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Complete Channel Revenue Mgmt Flow Automate End-to-End Business Process Plan Create budget for customer / product Set budget thresholds Allocate to sales hierarchy Execute Create offer Validate eligibility Price sales orders Calculate accruals and discounts Settle Create check / credit Manage deductions Plan Analyze Execute Monitor Settle Analyze Calculate ROI Review prior activities Monitor Update checkbooks & GL Calculate actual ROI Verify field activities Capture POS data
Operational Challenges and Costly Customers and Markets International Markets, Currency Issues. Global Customers &/or Suppliers, Distributors Territories, Buying Groups, GPO s.. Sales Data Sales Data from bespoke systems, Direct, Indirect Sales, POS / Ship and Debits Rebate / Discount Types Complex Pricing, Rebates, Accruals, Off Invoice, Lumpsum, Volume Rebates, Net Accrual, Quantity Limits, Price Buckets Accounting Accounting concerns and accurate ledger postings. Flexibility to track liabilities, post earnings, protect margins Adjustments Requirements Changes to Dates, Discounts. Backdated Adjustments, Returns, Retroactive pricing, Earning Adjustments, Alternate Payee Governance Customer revenue and profit reconciliation exposes risk. Need consolidated insight into Liability and Payments
EBS Channel Revenue Management Solution Inputs Customers Products Promotions Claims Marketing Sales Supply Chain Finance Budget Management Create budgets Allocate budgets to sales hierarchy Performance Monitoring Track expenses and accruals Analyze sell-in and sell-thru effect Receivables Payables etax Analyze Monitor General Ledger Inventory Mgmt MOAC Plan Single View of Customers & Products Settle Enterprise Integration Order Mgmt Advanced Pricing Workflow Execute Trade Promotion Management Create offers Validate eligibility Claims Management Approve & settle claims Update financials Marketing Partner Mgmt Endeca Stakeholders Outputs Increase Promotional ROI Lower Claim Costs Control Promotional Liability Risks
Workflow Driven Approval Process Provide a Strong Internal Control System Workflow Engine Trigger Budget creation Budget allocation Promotion fund request Promotion adjustments Claim settlement Outcome Automated approvals Complete audit trail
Budget Planning Set Foundation for Tracking Spending Business Flow Create Budgets Define Eligibility Define Thresholds Allocate Centralized view of trade budgets Controlled trade spending Benefits Support for all budget processes Shorter time to distribute funds Plan
Comprehensive Offer Types Support All Promotional Activities Order Value Off Invoice Promo Goods Volume Pricing Offer Types Terms Upgrade Lump Sum Scan Data Net Sales Accrual Provide Multiple Promotion Options to Sales Reps and Trade Marketers Execute
ROI Projection Calculate Expected Net Impact of Promotional Spend Impact of Discount Promotional ROI Integrate with 3 rd party demand forecast systems to calculate baseline sales and lift Automatically retrieve cost of goods from ERP system Calculate ROI based on sales forecast Analyze
% Discount % Discount % Discount Comprehensive Volume Pricing Incent Customers to Purchase Higher Volumes of Products Product 1 Product 3 Product 2 Customer B Customer Customer C C Customer D Flexibly Define Pricing Agreements Specify discount eligibility by customer, product, market, date Define discount tiers by quantity, dollar amount Define discount amount by percent, dollar amount Create combined volume offers Customer A Customer A Purchase Customer Volume B Customer B Customer C Purchase Volume Simplify Administration Create all volume offers for customers from a single screen Assign a volume offer for a product to one, many, or all customers Support direct and indirect sales Purchase Volume Execute
Streamlined Execution and Tracking Promote Effectively, Monitor Diligently Business Flow Benefits Calculate Accrual Validate Performance Calculate ROI Streamline promotion tracking process Measure promotional effectiveness Update Financials Provide timely, accurate accounting Visibility into promotional expenses and liabilities helps anticipate and control risks Consumer goods companies spend 15-20% of their revenues on trade funds. Often times, companies neither realize a return on their investment, nor know with certainty where the money is going. -- Kara Romanov, Sr. Research Analyst Execute Monitor
Indirect Sales Accruals Analyze Sell-Through Effect Manufacturer Sale Distribution Channel Indirect Sale End Customer Import & Cleanse POS Data XML, EDI E-Mail, Other Indirect Sales (POS) Data Identify Applicable Promotions Run pricing simulations Validate compliance to pricing agreements Validate against special pricing requests Chargeback / Claim Promotion Payments Outputs Indirect Sales Data Table Indirect Accruals Provide Incentive to Both Distribution Channel and End Customer Execute Monitor
Channel Inventory Tracking Gain Visibility into Channel Inventory and Throughput View channel inventory by account Track inventory throughput Monitor
Integrated Funds Tracking Process Provide Real-Time Visibility into Expense and Liabilities Sales Orders Funds Accrual Engine Monitor Promotion Fund Usage View Committed vs. Utilized vs. Paid Monitor
General Ledger Postings Accurately Account for Sales / Expense and Liability Sales Orders & Claims Accrual Engine General Ledger Direct Sales Indirect sales (POS) Chargebacks Net sales calculations Scan data offers Lump sum offers Retroactive adjustments Other adjustments Post accruals and claims to GL with option to post off-invoice promotions Account for promotion as a reduction in revenue or as an expense Apply Proper Accounting for Any Country Minimize Financial Risks with Upfront Accruals
Claim and Deduction Management End-to-End Process Business Flow Create Claim/DED Assign Owner Research Approve & Settle Adjust Financials Benefits Minimize the cost and time required to clear claims & deductions Identify and collect invalid claims Proactively prevent deductions Efficiently process promotional payments Settle
EBS Channel Revenue Management Applications EBS Extensions
Key Benefits Channel Revenue Management Endeca Extensions Eliminate revenue leakage Quickly identify and charge back invalid deductions Gain control over trade funds with comprehensive budget visualization Improve payment collection Prioritize high value claims for closure to maximize cash returns Quickly identify past due balance and take action to recover payments Increase profit margins Identify overbooked claims agents and balance workload to clear aged claims Improve operation and process efficiency with smarter analysis and effective collaboration with customers/suppliers 19
Oracle Channel Revenue Management Solution Streamline the Budget Allocation and Management Process Drive Effective Sales and Promotional Planning Monitor Performance and Control Promotional Exposure Minimize Claim Processing Cost