Introduction:
Hi, My name is Narendra and I am Certified SAP HANA Consultant currently working as a Managing
Consultant for TekLink Software Pvt Ltd – An HGS Company with primary Skills on BW4HANA,
S4HANA and SAP Trade Management.
Significance of SAP Trade Management in Simple
Terminology:
SAP Trade Management (SAP TM) is like a digital assistant for businesses that helps them to Plan,
Execute and Analyse Trade Related Activities.
SAP Trade Management (SAP TM) is a comprehensive tool that covers everything from promoting
products and collaborating with partners to manage funds and analyse the success of campaigns.
Let’s break it down with an example:
Promotion Planning- Assume XYZ Company, launching a new snack product named ‘Masala
Potato Chips’. SAP TM helps you Plan how to Promote it – May be through discounts,
Advertisements, or any special displays in stores.
Collaboration with Partners – SAP TM lets XYZ Company to closely work with Partner (like
Retailers/Distributors/Wholesalers) to create Joint Plans. In simple, it’s like sitting down with
Retailers/Wholesalers to figure out how both (XYZ Company and Retailers/wholesalers) can
make the product launch successful.
Budget/Funds Management- As specified in the Promotion Planning when XYZ company
offering discounts or running ads, they need money for that. SAP TM helps you to manage
your budget, making surely you spend wisely on Promotions to get the best results.
Data Analysis – After the Promotion is executed, XYZ company wants to know how well it
worked. SAP TM gives you tools to analyse data – like how many Snacks were sold during the
Promotion. This helps XYZ company to take Smarter decisions for the future. SAP Trade
Management provides some Standard Key Performance Indicators (KPIs) which are used to
analyse Data.
Standard KPIs : Below are the list of Standard KPIs provided by SAP. Based on the user requirements
new KPIs can be included or existing KPIs are excluded.
KPIs used in SAP Trade Promotions
Sell-In Total Promo Discounts (ON)
Sell-In Promo Promo Discount (%)
Sell-In Non-Promo Promo Discount (pU)
Sell-Out Total On Invoice Total
Sell-Out Promo Slotting Fee (OFF)
Sell-Out Non-Promo Slotting Fee Rebate (%)
Sell-In Total Slotting Fee Rebate (pU)
Sell-In Base Slotting Fee Rebates (Fixed)
Sell-In Uplift Promo Rebates (OFF)
Sell-Out Total Promo Rebate (%)
Sell-Out Base Promo Rebate (pU)
Sell-Out Uplift Promo Rebate (Fixed)
List Price Off Invoice Total
Gross Sales Value Promo Investment Total
Promoted RSP (per CU)
KPIs used in Customer Business Planning
PY Base Volume Sell-In Promo Slotting Fee Rebate (%)
Store Open/Close (%) Sell-In Non-Promo Slotting Fee Rebate (pU)
Store Open/Close Volume Change Sell-In Non-Promo (Editable) Slotting Fee Rebates (Fixed)
Distribution (%) Sell-Out Total Promo Rebates (OFF)
Distribution Volume Change Sell-Out Promo Promo Rebate (%)
Base Volume Sub-Total Sell-Out Non-Promo Promo Rebate (pU)
PY Retail Price Sell-Out Non-Promo (Editable) Promo Rebate (Fixed)
Retail Price Increase (%) Sell-In Total Off Invoice Total
Every Day RSP Volume Change Sell-In Base Net Net Invoice Value (pU)
Category (%) Sell-In Uplift Net Net Invoice Value Total
Category Volume Change Sell-Out Total Base Investment Total
Advertising & Promotion (%) Sell-Out Base Promo Investment Total
Adv. & Promo Volume Change Sell-Out Uplift Cost of Goods Sold
Other Drivers (%) List Price Internal Profit (pU)
Other Volume Change Gross Sales Value Internal Profit Total
Innovation Baseline Slotting Fee (ON) Internal Profit (%)
Sell-In Base Volume Slotting Fee Discount (%) Return on Investment (%)
PY Base Volume Change (%) Slotting Fee Discount (pU) Retailer Shelf Price (per CU)
Sell-In Uplift Volume Promo Discounts (ON) Promoted RSP (per CU)
PY Uplift Volume Promo Discount (%) Regular RSP (per CU)
PY Uplift Volume Change (%) Promo Discount (pU) Customer Profit (pU)
Sell-Out Total Volume On Invoice Total Customer Profit Total
PY Sell-Out Total Vol Net Invoice Value (pU) Customer Profit (%)
PY Sell-Out Total Change (%) Net Invoice Value Total Customer ROI %
Sell-In Total Slotting Fee (OFF)
In my next Blog, will take you through each KPI with an example….
