80:20 it is not!

About 12 years ago, in 1987 to be precise, I read an article written by Porter Henry, President of Porter Henry & Co. In an article entitled ‘The Important Few – The Unimportant Many’ he mentioned in passing that the 80:20 distribution with which we all are so familiar, does not describe the distribution of things in FMCG. In his original article he used data to construct calling plans for a territory, and to illustrate how easy it is to over-service small customers – and thus by definition under-service the few big ones who count. In fact Porter Henry did not make a big song and dance about the fact that 80:20 does not fit grocery, so I will address that issue now.

The 80:20 rule is so well known because it does describe distributions which fit many situations in business. In fact it describes accurately the distribution of sales in industrial selling, where one or two big customers will dominate your orders. But wherever consumers play a large part, there is a different distribution. In this situation the sales are far more evenly spread.

So if you are looking to:

• optimise your sales territories, and ensure your merchandisers or sales reps allocate their time efficiently
• determine if your sales are adequately distributed across a territory
• find out if your product range is too deep
• find out if you should expand your product range

Download the full article The distribution of sales in FMCG / Grocery Case Study PDF

Based from Smithfield in Sydney’s northwest, Campbell Consumer Products is the largest Australian owned manufacturer and marketer of predominantly household laundry and cleansing products.

Predominantly, the Campbell Consumer Products’ range is available throughout Australia & New Zealand. Campbell produces its products at Smithfield, Sydney. The range has a reputation for providing quality products, which represent value for money. Household names include: Greencare Laundry products; MYO Disinfectant; Bushland Products and Zixo bleaches. Campbells has been successful in delivering strong growth in their core categories through sound promotional strategies executed with high precision to ensure they reach their consumers.

Download the full Campbell Case Study PDF

Does the Promax system have the ability for a product to be forecasted using the same algorithm from a related product. This could be used when a specific product or group of products have no historical data but there are other products that have similar demand attributes. This is also required when a new product is created that is replacing an existing product.

Promax PX allows statistical models to be copied from one SKU to another. All Statistical Models within Promax PX are calculated & setup for an individual Account & SKU combination

The system must realign historical data when customer or products attributes change. This is to allow the users to compare values in a consistent manner and reflect current environmental settings.

The Promax PX uses a Database Row ID for Accounts and Products which means that attributes can be changed without affecting the historical data stored against the records. The Promax PX interfacing has old code / new code functionality which will allow the replacement / update information to be sent from the ERP system and automatically changed within Promax PX resulting in no double entry of data.

Products & Accounts can also be managed easily within Promax PX by using the Accounts & Products menus. You can edit the Product & Account attributes and drag and drop Products & Accounts to another location if desired.