Why Do Marketers Struggle With Multi Channel Sales Management?
Multi channel sales environment is quite common to many of the day-to-day businesses we come across. While the channel sales structure and business environment is evolved and stable in the developed economies it is very very complex in growing or under developed markets. Since, most of the companies are working around their next growth story in these emerging markets, very often we come across marketers who are puzzled in managing their sales channel and making quick business decisions due to lot of uncertainties. In this discussion, we are going to analyze some of the key challenges in channel sales management.
Complex Business Environment: A typical channel sales environment involves movement of manufactured goods from the factory to the central warehouse or depot, from central warehouse to regional warehouses, from regional warehouses to national distributor, C & Fs or super stockiest, from super stockiest to distributors/wholesalers, from distributor/wholesaler to dealers or retailers and finally to the end consumers. At each stage, either a stock transfer or business transaction (billing) happens. In either case physical movement of inventory takes place and logistics come into picture. At the same time each of these entities store or stock part of the inventory readily available with them for supplying/selling to the entity lower down the hierarchy. As most of these business entities are owned and managed independently, there are high chances of communication gap and poor decision making due to multiple business specific factors leading to the delay in supply, transportation, sales, payment collection, production planning, material procurement and ultimately good amount of business opportunity loss.Multiple Role players and Business Influencers: Starting from Top Management including the CEO, CFO, CIO, Sales Head, Supply Chain Head, Logistics Head to the Mid & Lower Management including Regional/Zonal/Area Managers there is an array of decision makers who influence business transactions. Inefficiency, mis-communication or lack of coordination on the part of any of these role players can cause huge business loss and adversely affect the business sustainability.Too many manual interventions & inaccurate information capture: Right from the level of field sales executives, supply & dispatch executives to higher up in the distribution channel, there are several manual & inaccurate interventions. For example, majority of the sales executives take order from the retailers on a piece of paper or at times over a phone call without recording it anywhere and share it with the distributors incoherently. Similarly, billing & supply executives at the wholesaler or distributor point dispatch goods on assumptions, guestimates and availability of stocks at their local warehouse. Thus, most of the time there is a big gap between the orders generated from the field vis-à-vis stocks available with the supplier and actual goods billed/supplied to the retailers. Owing to the large number of retailers, wholesalers and other channel sales entities, this gap at the lowest level sales channel can create a chain of business information gaps and lead to big time business loss due to inaccurate sales & distribution decisions.Data redundancy and Delayed Reporting: Manual order & information capture from the field, data entry at multiple levels by different role players & business entities more than often results into data duplication, data inaccuracy and delayed data consolidation. All this leads to poor visibility of information to the business decision makers and incomplete and inconsistent reporting to the management. Inconsistency & delay in the sales information from the channel not only creates bigger gap between demand & supply but also lead to poor sales forecasting, delayed product launch, ineffective promotional activity and much more.Disparate Tools & Techniques at different Business Layers: As we have already highlighted about the business complexity, involvement of multiple role players and independent business entities in the channel sales structure it is easier to highlight that most of these entities and role players use disparate tools & techniques to conduct business and capture information. For example, the company at the Top maybe using an ERP to track and control their production, supply, finance etc but it loses track of business activities happening beyond the head office, factory and central/regional warehouse. On the other hand the sales executives hired by the distributors/wholesalers may be using a piece of paper to take order and make dispatches and the Distributor itself using any stand-alone billing/invoicing tool or manual bill book to sell to the retailers. While, the company appointed sales executives who play a pivotal role in sales & business growth activity would be using spread-sheets and emails to communicate and report. Practically, the above scenario pushes most of the role players to live in their own disconnected world and make business decisions based on assumptions, guestimates and inconsistent information.