How CPG brands need to pivot their RTM organisations in the new (ab)normal?

by Krishna Kothari

May 26, 2020 | 02 min read


How CPG brands need to pivot their RTM organisations in the new (ab)normal

Over the last few weeks, we have all made changes to our lifestyles. Some of these changes will be temporary, a few will stay with us for a while and others might be permanent.

Organisations, big and small, across the planet are making changes too. Changes that are focussed on dealing with the health of their employees and ensuring business continuity. However, as lockdowns start to ease up, business leaders need to act now on what changes they will have to do to ensure smooth business operations in this new (ab)normal.

Brands to date have taken actions to ensure operational manufacturing lines and functioning supply chains to keep us all fed. This has alleviated some of the immediate pain, however, many pressures still loom large, including:

  • What will be the new operating model for on-field teams?
  • How to balance the books especially the RTM spend with high fixed costs
  • How to pivot the sales and distribution processes taking into account the changes in consumer behaviours
  • How to re-orient roles of sales and distribution teams as they serve their customers (retailers) with the right balance between “face-to-face” and “digital” touches

These challenges are being discussed in boardrooms across the industry as brands take a hard look at the role of their sales and distribution teams.

We believed that the role of a typical CPG salesman was going to change pandemic or not, however, this process has just been accelerated. Broadly there are three main changes that we foresee:

Specialism – Roles of different stakeholders in the CPG supply chain will get consolidated across different specialist buckets – Logistics, Merchandising, Order taking, business development etc. Specific organisations/individuals will drive these specialist roles across the ecosystem. For example, you will see a lot more partnerships where last-mile delivery will follow the Uber model, with these specialist firms delivering everything from shoes to food supplies to just a ride.

Upskilling – In this new normal the entire salesforce has to take on additional responsibilities. For example, salesmen will also be business development executives focussing on launching a new product in the market or increasing distribution as opposed to just order taking.

Digitalisation – A lot of the tasks that were typically performed by a human will get automated through bots, B2B commerce apps, automated visual merchandising models etc.

Leadership teams across Sales, Supply Chain, Technology and HR would need to come together and take the right steps to address this. Broadly these steps fall into the following two categories:

Rearchitect the sales and distribution model to create small but repeatable pieces of work which can be either automated (aka digitalisation) or outsourced to specialised firms. This will not only bring down the operational cost but also improve the speed at which brands are able to react. We are seeing many examples of this across the industry, albeit not in an organised/structured fashion to date.

Reorganising the RTM sales organisation into essentially a three-tier model:

Retail execution – This will include teams that will drive a range of retail execution tasks remotely e.g. over the phone via a call centre or supporting their customers to self-serve through B2B commerce platforms

Business Development – These will be the specialist teams that will drive more strategic tasks such as range selling, trade negotiations, NPD etc. These will be very data-savvy individuals who will ensure data-driven decisions with customers, helping them with the right product at the right price at the right location

Consultative sales – These will be the teams that will look after some of your largest customers typically a big key account and focus on creating new & innovative trade models. For example, selling your products through marketplaces or through alternative channels such as Uber or D2C in traditional trade-heavy markets etc.

Brands that are progressive and bold are already on this journey, where are you?

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