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Insourcing vs Outsourcing Field Merchandiser Services

30-Mar-2016

There are some obvious advantages for maintaining full control of your business activity. Many companies experiencing rapid growth choose to insource, investing heavily in sales and marketing, and utilising network strategy to develop strong business relationships. Bringing processes handled by third-party firms in-house can also be accomplished by vertical integration through the supply chain.

However, more companies are reviewing their go-to-market strategy. There’s an international trend towards outsourcing, with cost effectiveness as one of the main drivers. Increasing trading costs and retail price erosion mean more companies are looking to outsource their merchandising, brand management and key account management functions. Sales and Merchandising agencies (SMA’s) represent around 20% of grocery scanned sales for Australia and around 6% for New Zealand. Outsourcing enables a brand owner to focus on core competencies and strategy, while employing specialist skills.

Opmetrix Wall

Over 40% of brokers in New Zealand currently use Opmetrix for data collection and providing report analysis to their principals. Seamless sharing, organisation and management of customer information and data must be near real-time, and Opmetrix’s ability to segment data and report separately by principal has seen it become dominant for SMA’s.

SMA’s offer a number of advantages including wider national coverage with increased call frequency, the ability for smaller firms to leverage an existing sales infrastructure, consolidation across several brands for in-store managers, and flexibility of resources with the ability to contract extra specialist services as required.

Analysis of buyer behaviour and competitor activity can also assist with promotional or distribution drive activities, and lead to insights for marketing campaigns and new products.

Recently SMA – CS Brokers selected Opmetrix for their field team. Stephen Hay, Managing Director of CS Brokers says SMA’s “have an absolute focus on retail and the nuances of the FMCG market with their core competency managing the sales channel, whether grocery, route, pharmacy, mass merchants or food service. Focusing on this single aspect of supply to the market, enables SMAs to develop a level of expertise that a manufacturer or importer would find costly to replicate.”

On the flip side, Supermarket News reports that Blackmores, backed by strong global and local growth, have moved from an outsourced service and re-invested in a dedicated Blackmores Sales Team. Deva Dhar, Blackmores NZ Country Manager is quoted as saying “The team have just completed their first quarter in market and already sales are showing the Blackmores brand climbing the leader board.”

Whether you insource or outsource, the ability to provide excellent service is the key to success. The influence to increase sales based on distribution, shelf and in-store accuracy is paramount. Make sure you have the field and analytical tools you need to deliver.

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