dumex vietnam route to market. project committee 1.project leader: nguyen van tho – sales director...
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Dumex VietnamRoute To Market
Project Committee1. Project Leader: Nguyen Van Tho – Sales Director
2. Project Coordinator: Pham Xuan Dai - Sales Analysis
& Dev. Mgr
3. Project Member:• Nguyen Dinh – HR Director• Le Hoang Hai – Supply Chain Manager• Do Thi Kim Dung – Financial Analysis & Reporting
Mgr
4. Consultant:
Regional• Bruno CHEVOT - Sales• Pascal TOUVRON - RTM• Noel DUNBAR – Supply Chain CBU• Burhan – Finance Director
5. Sponsor:
• Rich Pham - Managing Director
RTM is at the heart of the Danone Mission and is strongly linked with our Baby Sales Strategy
To bring health through food
to the largest number of people
PeoplePeople Category
Category
Custo
mer
Custo
mer
Investment
Investment
Ava
ilabi
lity
Ava
ilabi
lity
It’s in the heart of the Baby Sales
Strategy
Aim of Route to Market
Drivetop line growth
Improveefficiency
Control of POS
Channel Developmen
t
Distributor Developmen
t
Issues
1.Financial capabilities of
current Distributors• Cash payment• Territory assignation• High inventory.
2.Control of POS.
Project Objectives
1.Keep up high sales growth.
2.Improve business productivity.
3.Enhance sales management &
control.
Project RoadmapReco
of
targeted Model
ImplementationAS-IS
Understanding
Identification of
Alternative Scenarios
1. Master data• Volumes per
City/Region• Volumes per
channel/Region• Milk powder
universal stores2. Distributor
profitability• S. Dist costs • Sales force costs• Management costs• Logistics costs
3. Current Role & Responsibility between DANONE and Distributors
4. AC Nielsen performance review
5. Benchmark with FMCG in Vietnam.
1. Model assessment based on the scenarios:
• Current model.• Recruit more
Distributors with current model
• Multi S. Distributors• Few Distributors* • Direct to Retailers
2. Description of each scenario
3. Define the criteria of assessment including:
• Dif. to implement• Risk & Opps• P&L• Productivity• Control4. Deliverable: Pilots
recommendation (incl. assessment + impl. requirements)
1. Implementation/Execution of Pilots
2.Define Criteria of success for each pilot. What is the key success factors? (Costs versus Control Complexity/Feasibility)
3.Organizational impacts & Change Management Anticipation (internal Danone)
4.Formalize Support for Decision.
5.Roll-out plan.6.Communication
Plan (Both External & Internal).
To be completed after scenario selection
30th Jun
Phase 1: As-Is understanding1. Master data
• Volumes per city/regional geographic organization.
• Volumes per channel/regional channel organization.
• Universal store by city Sales force organization
2. Distributor profitability• S. Distributor costs by region• Sales force costs by channel by region• Management costs• Logistics (Both of Distributor & S. Distributor)
3. Current Role & Responsibility between DANONE Vietnam and Distributors
4. Nielsen performance review find new opportunity in chasing more volumes• Distribution / Rotation per channel per segment
per city.• Market share per channel per segment per city.• Distribution / Volume sales per SKUs per city.
5. Benchmark with FMCG in Vietnam
Phase 1: Action PlanningAction plan
1st phase (AS-IS)PIC Remarks May June Jul
W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4
Volume per city/region/channel/MP universal store
Dai/Tho Market assumptionNPD Plan
Distributor profitability• S. Distributor cost per region• Sales force cost by channel per region• Management cost• Logistics cost (both Distributor & S.Distributor)
Dai/Kim Dung/Hoang Hai/Son/Hoi
Prepare P&L format
Current role & responsibility bw Danone and Distributor
Dai/Son/Hoi
ACN performance review (Distribution per region, market share per brand, store rotation…). Find out new opportunity
Dai/Son/Hoi
Benchmark with FMCG in Vietnam
Dai/Son/Hoi Abbott, MJ, Dutch Lady, Nestle, Unilever, SC Johnson & son
Phase 2: Identification of alternative scenarios1. Distributor model
assessment
1.1. Current model• Improve
performance / execution.
• Limit S. Distributor costs.
• Enhance sales management / control
DANONEVietnam
05Distributors
82S. Distributors
RETAILERS
Mead Johnson* model
Phase 2: Identification of alternative scenarios
1. Distributor model
assessment
1.2. Multi S. Distributor• Go Direct to S.
Distributor.
DANONEVietnam
XXS. Distributors
RETAILERS
Dutch lady, Nestle, Vinamilk & Uniliver model
Phase 2: Identification of alternative scenarios1. Distributor model
assessment
1.3. Recruit more
Distributor• Improve performance
/ execution.• Limit S. Distributor
costs.• Enhance sales
management / control
• Distributor direct to Retailer in key cities.
DANONEVietnam
XXDistributors
RETAILERSin small cities
XXS. Distributors
RETAILERSin key cities
Abbott*, SJ Jonhson & son model
Phase 2: Identification of alternative scenarios
1. Distributor model
assessment
1.4. Few Distributors
• Go direct from
Distributors to
Retailers
DANONEVietnam
RETAILERS
FewDistributors
P&G model
Phase 2: Identification of alternative scenarios
1. Distributor model
assessment
1.5. Multi S. Distributor• Go Direct to S.
Distributor.
DANONEVietnam
RETAILERS
For reference only
Phase 2: Identification of alternative scenarios2. Description of each scenario
• Role & Responsibility between DANONE & (Sub) Distributor.
• Sales force organization (recruitment, management, payment ).
• Difficult to implement• Risk & Opps• P&L• Productivity • Control
Deliverable: Pilots recommendation (incl. assessment + implementation requirements).
Phase 2: Action PlanningAction plan2nd phase
PIC Remarks June Jul Aug
W1 W2 W3 W4 W1 W2 W3 W4 W1 W2 W3 W4
Model assessment based on the scenarios:
• Current model.• Recruit more Distributors
with current model• Multi S. Distributors• Few Distributors* • Direct to Retailers
Description of each scenario
Define the criteria of assessment including:
• Dif. to implement• Risk & Opps• P&L• Productivity• Control
Deliverable: Pilots recommendation (incl. assessment + implementation requirements)
Open discussion: Can we do parallel if we start pilot run for model 3 at beginning of July? If we do so we will have 2 months for assessment (complete pilots at the end of Aug Can be well prepared for the budget of next year submission….In case these 2 models are not the best options, we still have time for pilot run for the other option at the beginning of Aug…..
Phase 3: Reco of targeted model 1. Implementation/Execution of Pilots
2. Define Criteria of success for each pilot.
(Costs versus Control Complexity/Feasibility)
3. Organizational impacts & Change
Management Anticipation (Internal DANONE)
4. Formalize Support for Decision.
5. Roll-out plan.
6. Communication Plan (Both External &
Internal)Phase 4: Implementation To be completed after scenario selection
Phase 3: Action Planning
Action plan3rd phase
PIC Remarks Aug Sep Oct Nov Dec Jan11
W1 W2 W3 W4
Implementation/Execution of Pilots
Define Criteria of success for each pilot. What is the key success factors? (Costs versus Control Complexity/Feasibility)
Organizational impacts & Change Management Anticipation (internal Danone)
Formalize Support for Decision
Roll-out plan
Communication Plan (Both External & Internal)
Implementation
Last Points
• Key success of RTM Full support s from CODIs
• We will meet every 2 weeks to ensure things are fully under our control.
• Keep this information among Project’s committee members only.
Thank You
Micro Planning
AS-IS
Understanding
Sales Volume per City
1. Master data: Volume per city:
• 6 key cities (ACN’s definition) contribute 53% of total sales• 21 top cities contribute 80% of total sales• GT contributes 91% of total sales nationwide
AS-IS
Understanding
1. Master data: Volume per channel:
• GT channel contributes 91% of total sales• DRC in GT channel contributes 65% of total sales• Grocery is the 2nd contribution and we will focus on this channel in this year
Sales Volume per Channel
AS-IS
Understanding
1. Master data: Average trade support per channel (mio VND/ton):
• Local store and Big C are the most expensive• Metro is the most productivity in term of cost/ton• Define cost per territory then
Trade Support per ton
Unit: mio VND/ton
AS-IS
UnderstandingMilk Powder Universal Store
Channel/Outlet (MP )
Grocery Specialty Market Stall
Pharmacy Total Current Dumex covered
% Dumex covered
HCMC 3,345 600 274 323 4,542 2,675 58.9%
Hanoi 3,050 200 3,250 1,608 49.5%
Cantho 710 710 275 38.7%
Nhatrang 222 222 209 94%
Danang 600 600 352 58.7%
Haiphong 752 752 285 37.9%
Other Provinces
7,000 7,924 7,393 93.3%
Total 15,679 800 274 323 18,000 12,797 71.1%
AS-IS
UnderstandingCurrent Distributor Profitability
AS-IS
Understanding
Current role and Responsibility bw
Danone & Dist.
Current roles and responsibility
Danone Distributor
Sales strategy X
KPIs alignment X
Training X
TMKT support X
Warehousing X
Inventory Control X
Credit Control X
Sales people and facility X
Delivery X
Distribution X
Support promotion X
AS-IS
UnderstandingACN
Performance Review
Identification of
Alternative Scenarios
Model Assessme
nt
DANONEVietnam
05Distributors
82S. Distributors
RETAILERS
DANONEVietnam
10Distributors
RETAILERSin small cities
54S. Distributors
RETAILERSin key cities
DANONEVietnam
82S. Distributors
RETAILERS
DANONEVietnam
RETAILERS
06 Few Distributors
DANONEVietnam
RETAILERS
Option 1 Option 2 Option 3 Option 4 Option 5Layer
Danone
Distributor
S. Distributor
Retailer
Identification of
Alternative Scenarios
Model Assessme
nt
Identification of
Alternative Scenarios
Model Assessme
nt
Identification of
Alternative Scenarios
Model Assessme
nt
Identification of
Alternative ScenariosDescription of
each scenario
Identification of
Alternative Scenarios
Define the criteria of
assessment
Identification of
Alternative Scenarios
Deliverable: Pilots recommendatio
n
Reco
of
targeted Model
Implementation
Reco
of
targeted Model
Define criteria of success for each
pilot
Reco
of
targeted Model
Organization Impacts
Reco
of
targeted Model
Finalize support for
decision
Reco
of
targeted ModelRoll out Plan
Reco
of
targeted Model
Communication Plan
Pilot of Distributor
Model 3
Map Universevs Actual Stores-> Provision Store (incl. Dumex)-> DRC-> Ideal Route Planning
Territory
Pilot
Audit As-Is-> Pic of success Compliance-> OSA-> Uncovered Stores
-> Delivery: * Actual cost from * Existing Model
1
2
3
4
5
Simulation of Resources Required-> #Presellers-> # vehicles-> Freq Visits per Cluster/Channel-> Time Study with with SubDist
-> Delivery: * FTE * Cost to serve
6
Pilot Roadmap-direct
July-AugSep:launch
Reco
of
targeted Model
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