International Wholesale Distributor

Challenge

EnterBridge worked with one of the leading specialist plumbing and heating distributors operating in the United States and Europe to develop a custom pricing analytics solution. The company distributes products through wholesale and retail outlets, employing approximately 2,000 sales representatives, operating out of more than 500 branch locations. The company works primarily with local contractors to supply products for repair, maintenance, and improvement of homes and businesses. The challenge the company faced was a lack of pricing consistency across all their outlets and different brands. Discounting was often done by sales reps without an understanding of the impact on margins, and customers were often confused about the pricing approach, which created a lack of trust, as pricing could vary substantially from customer to customer and was done primarily at the discretion of the sales rep or manager.  

To address this issue, they first needed to establish organizational ownership and accountability for solving the pricing problem and created a new pricing director position. The pricing director was responsible for looking at pricing, pricing strategy and developing a more consistent approach that included customer segmentation and advanced analytics to create pricing parameters to guide sales rep pricing behavior. 

Solution

The first step in the process included a customer segmentation effort that involved large data sets sitting in legacy systems across different business units. This data included transaction data, product, supply support, and customer pricing history. The segmentation created groups of similar customer types with accompanying price bands that relied on factors such as location, company type, and size.

A pilot program was set up in one location to test the new pricing algorithm in a live setting.  Instead of a single list price, sales reps saw a range of prices along with indicators—using a traffic light metaphor—showing red, yellow or green to indicate whether the price was out of bounds, acceptable, or ideal. The pricing bands used to produce prices quotes are displayed on the existing terminals so the reps see the approved price ranges and select the price to offer the customer. The selected price then populates the order form.  The reps were trained to start with “green” as the initial price point, and they can negotiate down from that point, while not going below “red.”  

With the solution now rolled out across the company, managers can now use aggregated metrics to monitor branch and individual rep pricing behavior.  They can look at particular reps that are consistently pricing in the red category and address the issue with them through additional coaching and training. 

Results

The company is now able to compare year on year margins and sales volumes and determine if either or both are improving. With the price bands in place, the sales reps have clearer guidance and more confidence and trust in their price recommendations.  The reps feel like they are now armed with as much information, if not more, than customers.  

Building the rep’s trust and confidence was a major objective for the company and a critical part of the behavioral change the company was hoping to see. The expectation was that more consistency and trust in pricing from the reps would translate into more satisfied customers through greater transparency and uniformity in pricing.  In addition to the margin and sales volume metrics, the company is now using the Net Promoter Score methodology to track customer satisfaction over time, and have already seen score improvements as a result of the new pricing approach. They look to build on this momentum to drive even greater satisfaction, sales, and margins. 


MOM Brands

Challenge

MOM Brands is the third largest manufacturer of cereals in the United States, and a subsidiary of Post Holdings, the largest consumer packaged food companies in the world.  For a company of this size, analyzing sales and performance metrics can be daunting. 

Part of the metrics they tracked included results from audits performed on 15,000 individual stores. They also looked at data by market and by store group.  Much of their data, however, was stored in various formats making consolidated reporting a challenge.  According to Ed Alencewicz, Director of Retail Experience, "We had all sorts of information, but it wasn't in a useful format for reporting.”  Also, the data gathering process in the field was time consuming and cumbersome, with reps using manual data entry and spreadsheets.   

Solution

EnterBridge teamed up with Canvas to deliver a consolidated reporting process that translated different reports into a single “language” that allowed leadership and sales to analyze and evaluate results in a consistent way.  Additionally, the EnterBridge team used Canvas to create smartphone apps for use in the field. The applications facilitated store shelf verification of product and compliance to existing distribution contracts. For the first time, the company had insight into this level of compliance at the store level in near real time.  

Results

By integrating the new reporting solution with MOM’s existing Excel-based reporting system, the client did not have to adopt a new system, but could use their existing tools.  With the new solution, they now had complete transparency between the data and reporting, resulting in better, more timely decisions. They could now make sure merchandisers were compliant, which helped to maximize shelf space and inventory stocking and to accelerate product movement. They also had a better understanding of how product was being purchased as well as when to stock and when to alter product mix and shelf space to maximize sales.

“EnterBridge understood that the technology is only one aspect of our partnership. They understood the needs of our business and were able to dive deep into the nuances of our reporting," said Alencewicz.


Xpedx


Challenge

Xpedx is a North American leader in business to business distribution of packaging, facility, and printing supplies. They provide storage and distribution solutions that help customers improve operational efficiency, streamline purchasing, and reduce overall costs. In 2014, they merged with Unisource Worldwide to create Veritiv (veritivcorp.com), which continues to serve customers across virtually every industry.

They needed pricing strategy and tools to support their 1,300 sales reps.  Sales leadership realized that "their judgement was as good as it gets," but they lacked the data and tools to analyze their competitors or to understand what was required to issue a winning bid.

Solution

Vice President of Sales Operations, Marsha Herzog commented, "EnterBridge and Advanous understood the market perspective to pricing. They approached us as a long-term project and became part of our business."  The EnterBridge team developed a solution that included price guides and price management tools to give the entire sales team greater insight into pricing decisions and customer behavior.

Results

"EnterBridge delivered technology that was focused on business results, and it wasn't just technology or analytics for the sake of data or supporting software. It was about results that drove our pricing conversations. More than a provider, they became a trusted advisor," said Herzog.

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