Industry Background
In today’s multi-layered route-to-market, managing sales through distribution partners has become increasingly complex. The traditional methods of simply tracking stocked and sold products are no longer sufficient. The sales process now involves a dynamic and intricate network of interactions between manufacturers, distributors, and retailers. This shift requires a more connected approach to distribution management.
Historically, distributor management has focused on the supply chain and movement of stock between the layers of the sales cycle. Companies focused on ensuring that products moved efficiently from their warehouses to distributors and eventually to customers. However, the expansion of global markets and the increased expectations of customers around speed & range have introduced new challenges that the traditional methods can no longer handle effectively.
Now, organisations need to manage their sales distribution in two critical steps: primary sales and secondary sales. Primary sales refer to the initial transaction between a company and its distributors, contributing directly to the company’s revenue and profit. Secondary sales involve the subsequent sale from distributors to retailers, where the distributor maintains a profit margin. Managing both these channels manually is not only challenging but also prone to numerous errors and inefficiencies when not connected.
The sales landscape is characterised by a wide range of challenges that demand the use of connected solutions. Companies are increasingly turning to distribution automation solutions to navigate these complexities. These solutions are designed to streamline and enhance the sales process, providing a much-needed solution to the intricacies of managing both primary and secondary sales channels through distribution partners.
For any business aiming to boost productivity and optimise profitability, sales automation solutions play a critical role. Despite its seemingly complex nature, these connected solutions simplify the task of automating and monitoring sales activities. It encompasses various aspects of sales management, including product and inventory management, order management, and facilitating interactions between the field sales force and different sales points. By integrating these functions, sales automation solutions ensure that companies can achieve high productivity and profitability.
The shift from manual to automated sales management is not just a trend but a necessity in the current business environment. The manual handling of sales processes is fraught with risks, including human errors, inefficiencies, and the inability to scale operations effectively. Automation addresses these issues by providing a systematic approach to managing sales, thereby reducing errors and improving overall efficiency.
In this context, Aforza Distributor Management solution emerges as a leading solution, offering a comprehensive suite of tools to manage and automate both primary and secondary sales through distribution partners. By leveraging Aforza DMS, companies can overcome the traditional challenges associated with sales management and achieve a seamless, integrated sales process that drives growth and profitability.
In the following sections, we will delve deeper into the intricacies of primary and secondary sales, the challenges faced by the industry in managing these sales channels, and how Aforza DMS provides the perfect solution to these challenges.
What Are Primary & Secondary Sales?
Primary and secondary sales are the two critical steps in the distribution of a Consumer Product company’s products.
Primary Sales
This refers to the sale from a company to its distributor, contributing directly to the company’s revenue and profit. Increasing primary sales is a primary focus for companies.
Secondary Sales
This involves the sale from the distributor to the retailer. Here, the distributor maintains a profit margin, selling the product at a dealer’s price.
Industry Challenges in Managing Primary Sales
Managing primary sales involves several challenges, especially in the absence of an automated system:
1. Complex Distribution Channels: Companies with extensive distribution networks struggle to manage and track primary sales effectively.
2. Data Tracking Issues: Without proper protocols, it’s difficult to track and measure sales data over time, preventing comprehensive analysis and improvement.
3. Forecasting Problems: A lack of forecasting leads to challenges in managing product stock updates and inventory levels, resulting in higher financial risks.
4. Inventory Management: The absence of a systematic approach hampers inventory management, making it hard to monitor goods movement across the supply chain.
5. Control Issues: Poor management of secondary sales directly impacts primary sales, highlighting the need for a connected system.
Industry Challenges in Managing Secondary Sales
Secondary sales management presents its own set of challenges:
1. Visibility Issues: Poor visibility in secondary sales, especially during high-demand periods, makes inventory tracking difficult.
2. Inventory Stocking: Insufficient inventory management can lead to stock shortages, affecting sales and customer satisfaction.
3. Coordination Problems: Manual coordination across various distribution points is cumbersome and prone to errors.
4. Database Management: The lack of a centralised database and disorganised supply chain operations can lead to revenue loss.
5. Market Research Deficiencies: Inadequate market research and feedback from sales reps hinder strategic decision-making.
6. Promotional Campaign Challenges: Ineffective management of trade promotional campaigns impacts secondary sales.
The Solution: Connecting Distribution Management across Primary & Secondary Sales
Efficient sales management across the distribution value chain is critical. An unorganised process can lead to significant profit losses, making it imperative to ensure smooth coordination between sales planning, distribution management, and order processing.
Here’s how connecting distribution management across primary and secondary sales can transform your operations:
- Execute Your Distribution Strategy: A well-organised distribution management strategy ensures sufficient stock during peak seasons, predicts future sales for raw materials, and maintains a robust market presence for sales representatives. Streamlining unnecessary elements is key to achieving this.
- Sales Visibility & Oversight: Effective sales management involves devising superior strategies, implementing motivation systems for team members, and conducting thorough performance assessments. Engaging team members in achieving the company’s goals is crucial for success.
- Respond to Market Dynamics: The sales & distribution structure is a complex organism encompassing various departments such as logistics, inventory, and delivery. Regular evaluation and fine-tuning of these components are essential for systematic sales management. This includes assessing results, formulating improvement strategies, and correcting errors.
- Measurement in Distribution Channels: Sales managers play a vital role in identifying the most profitable sales areas, selecting the optimal distributors and dealers, and evaluating the overall efficiency of the entire process.
By focusing on these areas, businesses can ensure a more integrated and efficient sales process. Connecting distribution management across primary and secondary sales not only enhances operational efficiency but also drives profitability and growth.
How Aforza DMS Can Help You Automate Primary & Secondary Sales
Aforza’s Distributor Management System (DMS) offers a robust solution to streamline and automate both primary and secondary sales processes, ensuring seamless operations and enhanced productivity.
Primary Sales Automation
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- Order Processing Automation: Aforza DMS automates the entire order processing cycle, from receiving orders from distributors to invoicing and shipping goods. This reduces errors and saves time.
- Centralised Distributor Network Management: It provides a unified view of all orders, inventory, and payments, making it easier to manage your distributor network. The system also aids in generating leads, tracking sales performance, and supporting your distributors.
- Real-Time Inventory Monitoring: With real-time tracking of inventory levels across the entire supply chain, Aforza DMS ensures visibility into stock levels at all times, helping prevent stockouts.
- AI-Driven Order Recommendations: Leveraging connected visibility, Aforza DMS uses AI to recommend the best orders and next steps, even when offline on the mobile. This ensures optimal inventory levels and improves decision-making.
- Comprehensive Reporting: The system generates detailed reports that help you monitor sales performance, pinpoint areas for improvement, and make informed business decisions.
Secondary Sales Automation
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- Order Taking Automation: Sales representatives can take orders directly from retailers using the app, eliminating the need for manual order entry and reducing the likelihood of errors.
- Sales Team Management: Aforza DMS provides real-time insights into the performance of your sales team. You can track visits, orders, and sales data effectively.
- Photo Automation: By capturing photos in the field, Aforza DMS allows distributors to prove performance and trigger the best next steps in the business workflow. This visual evidence supports compliance and performance tracking.
- Integrated Sales Process: By monitoring sales rep activities, promotional discounts, order invoicing, and payment tracking, the system ensures seamless integration with primary sales.
By implementing Aforza DMS, businesses can address the challenges of managing primary and secondary sales, leading to a more efficient and profitable sales process. The automation capabilities of Aforza DMS not only streamline operations but also provide critical insights for continuous improvement.
Aforza DMS addresses the challenges in managing primary and secondary sales by providing a robust, cloud-based solution. It centralises data collection from manufacturers and dealers, ensuring real-time stock updates and efficient management.
By integrating sales rep activities with manufacturing processes, Aforza enhances secondary sales efficiency and boosts revenue. Implementing Aforza DMS in your sales operations can transform your distribution management, driving productivity and profitability.
If you would like to see Aforza DMS in action, request a live demo here.