Tips & Tactics for Improving Your Co-Op/MDF Programs

According to a recent poll, when asked about their attitudes toward manufacturer MDF/Co-op programs, most partners stated that they either had no knowledge of the programs or did not see the value in participating. Of those channel partners who do participate, most expressed the need for more user friendly co-op programs that also fit the way they do business. They stated that the hangups with most co-op/MDF programs are long delays in getting claims processed, approved, and paid in cash. Below are a few tips on how to improve the impact of your co-op/mdf programs:

1. User-friendly Programs

Ensure that the program process for approvals and qualifying for funds are clearly documented. If a partner has questions, be sure there are FAQ's readily available and provide a list of POP options for partners to review.

  

2. Show Them the Money

Integrating an electronic funds processing solution can reduce time to payout by as much as 65%. It also provides an audit trail and makes it easy to measure funds disbursement for reporting metrics and remediation.

3. Seamless Processes

There should never be gray areas when a partner inquires about a claim request or payment information. Keep your partners happy by automating the process where partners can have a dashboad view of each claim.

4. Automate, Automate, Automate!

Making Co-op/MDF available to partners via the web will simplify submitting claim requests.  With a system that provides a step-by-step process, auto-populated information, funding validations, and internal reports, you will wonder how you ever managed without it!

Here are some things to consider when searching for the right Co-op/MDF solution:

1. Timeframe - A co-op/MDF application can take anywhere from six weeks to two years to deploy. Not  to mention the internal resources it will take to customize a solution and the time it will take to implement.

2. Budget & Cost -  Most Co-op solutions require a set-up fee and possibly back-end integration. One important thing you want to consider is if the solution supports the entire Co-op/MDF process from fund disbursement to metrics and reporting. Also, who will handle any customer support issues if they arise.

3. Scalabilty - Does the solution allow for growth or changes? Can the solution be deployed internationally and does the system support multiple languages and currencies?

CMR Co-op/MDF™

CMR's Co-op/MDF module automates traditional administrative processes and manual reporting functions to improve efficiency, accuracy and return on investment from trade promotion funds. The entire process can be completed in less than 5 minutes.

Features and Benefits

• CMR Accelerates Co-op/MDF Fund Approval Process
• Simplifies Processing
• Saves Time
• Reduces Labor Costs
• Helps Monitor ROI
• Improves Planning and Development of Marketing Programs
• Generates Custom Analytics
• Secured Data
• Allows Instant and Secure Access, 24/7

What to do about Special Pricing?
As discussed in a recent article in VARBusiness, “The Battle Over the Bid”, The Global Technology Distribution Council (GTDC) deemed Special Pricing™, “a bigger problem than most had expected” and “a priority for their organization”. There is no doubt that Special Pricing™, a problem already significant in Europe, has become an unavoidable issue within the channel. There is an obvious, inherent need for a secure system to automate the process of Special Pricing™. With the evolution of the distribution industry, the need for a less challenging process and thus a simplified supply chain is the much needed next step.

We here at Computer Market Research have developed an automated Special Pricing™ Module as part of our solution for Channel Information Management and PRM. Within our online PRM Solution we have integrated a user-friendly SPR form. The system enables channel partners to request Special Pricing™ with the ease and simplicity of filling out an online form and submitting it. The system itself manages the 'Approval', 'Reply Notification', and 'Credit Claim' processes. Any requests to change the price of a product as it moves through the channel are then recorded and managed within this system. An airtight security model ensures all of the SPR transaction information is protected but accessible to those with appropriate privileges.

Allow your partners to make expedited requests, increase sales success, and provide superior Partner and End-Customer service satisfaction. Both you and your partners can be free from time-consuming processes and now redirect those efforts into selling effectively, delivering quality pricing and building profitable partner and customer relationships.

Web-based Channel Management Holds Promise for Industry

PHCP manufacturers and wholesalers could benefit significantly from examining other industries for best practices related to automating channel management programs such as dealer registration, channel sales, co-op and market development fund programs, inventory tracking, special pricing and lead management. According to Del Heles, a veteran of industrial wholesaling and now a developer of channel management automation software, the technologies used in the PHCP business often lag behind solutions routinely used in other industries. “Having grown up in the plumbing and heating wholesale business and now working with many manufacturers in other sectors, I am surprised at how much closer partnerships are in other industries when compared to the plumbing and heating industry,” said Heles, president of Computer Market Research (CMR) in San Diego. “Especially in the technology sector, manufacturers and wholesalers must be extremely efficient in sharing, processing and analyzing key data from their channel partners,” Heles explained. “This is a matter of pure survival in fast-moving industries. If manufacturers are not up to speed on what products are selling through at the distribution and retail level, who the buyers are and what inventory remains in the channel, they could suffer millions of dollars in losses from obsolete inventory in warehouses and on store shelves.”

Reducing customer retention costs

Retaining existing customers can be time-consuming and expensive. It has become cost-prohibitive for many companies to make field sales calls on every customer, since a personal sales visit today can cost as much as $525 and more, according to sales management analysts. Automation tools can help companies manage and optimize results from alternative sales efforts such as e-mail campaigns, telephone campaigns and direct mail letters. “It has been proven in other industries that channel relationships and channel efficiency improve with automation because of the easy adoption of tools such as Web-based applications that require little training and no software to install or maintain,” Heles said. “There is nothing worse than spending tens of thousands of dollars to develop a co-op program that nobody signs up for because it’s too hard to maintain and too time-consuming to fulfill requests in a timely manner. As soon as a company switches to an automated solution, many of these problems are resolved and the channel programs become much more effective.”  

Partners can move inventory faster, orders can be placed more efficiently, shipments are received more quickly and wholesaling channels benefit from improved accuracy. “Conservatively, the potential cost savings and improved efficiencies that could be made possible by widely implementing the latest channel management applications could add hundreds of millions of dollars to the overall bottom line of the plumbing and heating industry,” Heles estimated. “We’re talking about saving countless hours of manual administrative work and improving process accuracy by eliminating error-prone manual steps. Managers will have instant and secure access to the latest inventory and point of sale information from anywhere in the world at any time. Executives will know exactly where and how much inventory they have in their warehouses and in-transit and marketing will be better able to identify potential problems in the pricing of products or in the tactics being used by sales teams.”