Nicholas Gitto distinctly remembers interviewing for the position of Vice President of Customer Marketing & Sales Operations at AdvancePierre Foods. “We were discussing the many challenges associated with managing trade spending in the retail industry. I knew if I got the job, that responsibility was going to fall squarely on my shoulders. In that moment, I made a pledge. I told my potential boss that I would manage trade spend more effectively than had been done–Period!” It’s not every candidate for a leadership position that would be willing to make such a promise—especially for a company operating in an industry that is notoriously inefficient when it comes to trade promotion management (TPM).
But Nick Gitto was not a typical candidate. He came to his position with deep knowledge of how to optimize trade spending. He also knew that AFS™ Trade Promotion Management Retail (TPM Retail), formerly TradePro, had all the features he needed to keep his word.
THE NEED FOR VISIBILITY
If consumers are not familiar with AdvancePierre Foods, they certainly are familiar with the company’s iconic brands—Barber Foods®, Steak-EZE®, Fast Fixin’® and Pierre™, to name just a few. AdvancePierre’s success is based largely on its commitment to exceed consumers’ expectations for quality food experiences. That commitment has been the catalyst for a series of mergers and acquisitions (M&As) that have made Cincinnati-based AdvancePierre an industry-leading supplier of beef, chicken and pork products to foodservice, retail, school and convenience channels across the United States. The company is, in fact, the country’s #1 provider of sandwiches, fully cooked burgers, Philly steaks, stuffed chicken breasts and country-fried steak.
Despite its success in the market, AdvancePierre’s growth potential was being stifled by the weak performance of its trade spending programs. A lack of spending insights, coupled with widespread inefficiencies in TPM processes, was causing the sales organization to spend much more time on trade promotion management than it should have been spending. As a result, millions of dollars were drained each year from the company’s bottom line.
EFFECTIVE TPM PROCESSES AND TECHNOLOGY UNDERPIN SUCCESS
To reverse its lackluster TPM performance, the company implemented the AFS TPM Retail. This was a logical choice. AFS TPM Retail is a leading TPM solution, designed specifically to help companies like AdvancePierre gain better visibility into its trade spending, and use that visibility to drive greater efficiencies throughout the TPM value chain. Additionally, TPM Retail had been used successfully in other AdvancePierre divisions and also by some of the companies that AdvancePierre had acquired. Members of the AdvancePierre team had seen first-hand the benefits that could be achieved.
As it turned out, the retail division faced significant challenges when it came to creating the TPM capability it wanted. Nick Gitto—with his bold promise to rein in trade costs—was brought on board to help optimize AdvancePierre’s trade spend potential. As Nick explains, “I was very familiar with AFS TPM Retail from my previous roles in other companies, and I knew it offered all the features and flexibility AdvancePierre needed to realize its TPM vision. The challenge was due to our processes and policies.” AdvancePierre launched a TPM transformation that focused on three areas: process alignment and reengineering, reporting and training.
As Nick explained, “In my opinion, these are the three bundles of capability that underpin a TPM program’s success. Our goal was to address these areas so that they—individually and together—would optimally support the AFS TPM Retail solution.” Nick applied his deep understanding of process development to define roles and responsibilities and standardize how the sales and marketing teams would use TPM Retail to manage trade-related activities and costs. Reporting and training processes were also adjusted to better meet the needs of the AdvancePierre business.
Throughout the transformation, experts from AFS technologies were on hand to ensure that the TPM Retail system supported by AdvancePierre’s new ways of working. This involved tactical training and managing the technical interface between TPM Retail and the client’s existing ERP system. According to Nick, “One of AFS TPM Retail’s biggest advantages is its ability to work so seamlessly with other systems. With that built-in agility, we knew that TPM Retail was going to take our data loads and turn them into insights that would drive our business forward.”
RESULTS: OPTIMIZING ADVANCEPIERRE’S TRADE POTENTIAL
New processes, reporting structures and training have helped AdvancePierre’s retail division optimize the value of its AFS TPM Retail investment and dramatically improve the way it plans and manages its trade spending. Those improvements are reflected in the fact that, after the first year of using TPM Retail with new processes and policies, AdvancePierre has pulled millions of dollars of inefficient trade spending out of the system and reapplied these trade funds back into the business building customer programs. According to Nick, detailed processes that effectively support TPM Retail have made all the difference. “We now have standardized, boundary-driven processes directing the ‘who, what, when, where and why’ of trade spending. And, perhaps most importantly, we now have a streamlined planning cycle. The plans we develop with our brokers and field sales reps are uploaded as flat files into the TPM Retail, which is saving us a month of planning time. Previously, we were loading everything related to our planning by hand.”
Nick attributes the successful transformation of trade spending to two primary factors. “One is visibility. With our new processes, AFS TPM Retail now gives us clear insight into everything—from our plans (and our real-time performance against those plans) to the safeguards we use to prevent mistakes. The second factor, which is related to heightened visibility, lies in the post-evaluation models we can now employ. These models allow us to understand exactly what is working and what is not. We can even examine returns by customer or brand to understand who is spending what and why. With that level of insight, we can make really good choices when it comes to future planning and investment strategies.”
It goes without saying that Nick has been able to keep his promise. “AdvancePierre has removed inefficient trade spending and has reinvested those dollars into the business for long term growth. The AFS TPM Retail has been a huge contributor to those gains. And, on a personal note, the AFS Technologies solution has enabled me to be true to my word.”