Getting Your Fizz to Pay Off with BI

Case study: When Royal Crown had to figure out how to package, price and move its soft drinks, it chose Salient's Margin Minder Max to help out.

Used to be, soda was soda.

Used to be, a sales rep standing in front of the cool mist pouring out of the soda pop cooler would go on gut instinct when it came to figuring out what to charge a convenience store for a shipment of RC cola or 7UP.

Then there came acquisitions. Costs went up, and margins shrank. Consumers started getting a taste for all manner of beverages—sports drinks, flavored waters, fruit teas, juice concoctions, you name it.

And to top it all off, big-box stores like Wal-Mart suddenly started calling all the shots, demanding data to sate their thirst for predictable, consistent profitability.

How, in a fast-moving market like soft drinks, does a sales rep on the street know how to manage an account, with all this new packaging, new products and new options available to every account? How does a vendor come up with the information to predict and report on the data big boxes are demanding: Namely, how much can vendors add to the bottom line?

For Royal Crown Bottling—purveyor of RC, 7UP, and a growing line of other soft drinks, teas, fruit drinks and bottled water in a territory that spans Indiana, Illinois, Kentucky, Tennessee and Missouri—the answer was Margin Minder Max, a BI (business intelligence) platform from Salient Corp. thats based on the companys latest UXT high-performance data integration software.

With UXT, the newly automated sales team left behind a homegrown information analysis system that involved reams of paper and weeks of analysis. RC Vice President of Sales and Marketing Chad Metten described the former setup as being just your basic data dump into an AS/400—thats as fancy as it got.

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"The IS guys would produce a sales generator report, which is what we hard-key to settle invoices," he said. "That information was basically summarized in a lengthy green-bar report that youd have to go in and analyze yourself."

Today, with the click of a button on UXT, managers can find profitability on an account, whether RC is making good on marketability programs, and what packages and brands work together to enhance sales and profitability.

Not only can RC hand over the detailed information necessary to smooth its relationship with Wal-Mart, but its also using the big-box approach to better understand how to help smaller customers by getting the product mix and pricing strategies right.

Results are improved profitability of 10 cents to 15 cents per case, thanks to more effective pricing strategies. Sales volume is up with customers of all sizes, and rapid response has changed from two weeks to next day.

Best of all, RC has gained insight to stay competitive as the company builds market share.

Next Page: The IT manager weighs in.