Diverging TPM Tool Choice Widens Gap Between Large and Small Consumer Goods Manufacturers

Pittsburgh, PA (PRWEB) June 20, 2012

As the global provider and thought leader in Trade Promotion Management (TPM) solutions, TradeInsight partnered with Consumer Goods Technology (CGT) Magazine to uncover how Consumer Packaged Goods (CPG) companies of all sizes are tracking promotion effectiveness and reacting to TPM business challenges and emerging technology solutions. For the third consecutive year, a mix of CPG manufacturers with revenues ranging from $1 million to greater than $3 billion participated in the May 2012 research survey.

While improving the effectiveness of trade spend dollars continues to be the leading challenge for this year’s survey participants, the approach to success differs by company size. According to the new research, eight out of 10 large CPG manufacturers have abandoned Excel® spreadsheets as a trade spend tracking tool in favor of packaged software and custom built TPM solutions. With only one out of 10 large manufacturers using Excel®, bigger CPG companies are widening the gap between the 59 percent of small manufacturers still relying on static spreadsheets. The jump to technology indicates the TPM pendulum is swinging in favor of large manufacturers who leverage a more sophisticated TPM tool to make informed business decisions on promotion effectiveness, ROI and profitable customers.

As a result of a manufacturer’s TPM approach and tool of choice, the data also reveals a growing disparity among trade-related business challenges and key priorities. Seventy-one percent of large companies have a strong desire to utilize Trade Promotion Optimization, or to understand the advanced prediction capabilities that come after mastering TPM fundamentals. In contrast, small manufacturers are continuing to struggle with basic TPM issues related to trade spend effectiveness (59%), visibility (53%) and reconciling deductions (36%).

Despite the increasing complexity of trade promotion management, more than half of the small manufacturers polled cited organizational readiness as the primary barrier to adopting a packaged TPM solution. While cost is an ongoing obstacle for both small and large manufacturers, inadequate resources is less of an issue now than in prior years. This is likely due to Software-as-a-Service (SaaS) technologies which have significantly reduced implementation timeframes, costs and demands on IT support.

While the research shows CPG manufacturers are clearly divided on how to best manage the second largest expense on the company’s P&L, both groups reported common challenges when working with retailers. Satisfaction with retail execution followed by difficulty demonstrating joint value on promotions ranked high among survey participants. Forty-five percent of the large manufacturers polled are still experiencing pressure from retailers to buy down price while unexpected retailer deductions are a challenge for 35 percent of small- and mid-sized companies.

For a complimentary webinar presentation offering detailed commentary on the 2012 research findings in comparison to 2011 results, download 2012 Trends, Technologies & Benchmarks Revealed. For additional analysis into the survey data, a new whitepaper titled “Trends in Trade Spend: The Emerging Disparity Between Small and Large Manufacturers” is also available for download.

About the Consumer Goods Technology
Owned by Edgell Communications, Inc., Consumer Goods Technology (CGT) is a leading resource for Consumer Goods (CG) executives looking to improve business performance. CGT reaches an audience of more than 58,000 Consumer Goods executives and covers all major segments of the CG sector, including Food, Beverage, Packaged Goods, Apparel and Footwear. The May 2012 research survey commissioned by TradeInsight is intended to identify and better understand trade promotion management initiatives and processes throughout the industry. For more information on CGT, visit http://www.consumergoods.com.

About TradeInsight
TradeInsight, a global provider and thought leader in Trade Promotion Management (TPM) solutions, offers the only TPM software application in the marketplace that provides visibility of spending from the warehouse dock to the consumer. Founded in 1983, the company gives Consumer Packaged Goods manufacturers the power to integrate TPM into existing sales and marketing accounting systems to better track trade spend performance across the entire supply chain. TradeInsight’s low cost Software-as-a-Service (SaaS) application can be deployed in a matter of weeks not months with no upfront fees and a proven return on investment within the first year. To learn how to sell more and spend smarter, visit http://www.TradeInsight.com, call 800.463.6634 or browse TradeInsight’s online resource library of whitepapers, webinars and industry-related articles. Connect with TradeInsight on LinkedIn, follow the company on Twitter and become a fan on Facebook.

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