Trade Efficiency

A multi-million pound manufacturer of branded and private label laundry and household care products, asked IRI to help reengineer its £374 million annual trade program to enable the organization to balance share growth and profitability.

IRI identified 5-7% trade efficiencies that allowed the company to compete more effectively in the marketplace.

THE CHALLENGE

The client’s existing approach to price and trade did not allow for optimization of spend with enough granularity (i.e. local product levels).

IRI conducted a detailed trade diagnostic that included:

Assessing the effectiveness of trade promotions and pricing processes
Evaluating the structure of the funding program and go-to-market strategy
Building a price elasticity model across 12 retailer accounts to estimate ROI for everyday low pricing (EDLP) and Hi-Lo events

IRI also designed a new variable trade funding program with pay-for-performance that brought greater discipline and structure to the client’s trade and pricing processes:

Built capabilities and tools needed to assess trade ROI and conduct scenario planning, including:
- Scenario Planner: enables the planning of events and project the lift and ROI, both at an individual event level and for the annual plan
- Trade Fund Allocator: facilitates an automated, step-by-step process to set funding at the brand level by customer, aligning to previous year trade spend and volume targets
- Engaged with sales teams to provide detailed guidance and parameters, including how to work with retail partners

Key recommendations included a set of tactical guidelines for the trade program, as well as specific reallocations of funds:

THE RESULT

IRI identified 5-7 percent trade efficiencies from reallocation of poor-performing trade funds to higher-return trade activities

Growth Delivered

How can we help you supercharge growth and profitability?

FACTS ABOUT US

95% of FMCG, retail, and health and beauty companies in the Fortune 100 work with us.

Enter security code: