Looking back to look forward: Making the most of the new program year
John Brubaker
As harvest season starts in the fields, it’s a different kind of transition time at the Ag Retail head offices.
You know this phase well.
If you’re in charge of managing pricing or incentive programs, you’re in that in-between space of:
“How did we do last year?” and
“What are we going to do this year?”
This entry point to a new program year is a critical time. It can set the stage for your entire next season.
But without the right tools in place, looking either back at the past year, or forward into the next one, is much more challenging — especially given current industry trends.
For Ag retailers, the average number of changes per SKU more than doubled between 2020 and 2023. Keeping up with those could be its own full-time job.
And beyond just keeping pace with the swirl of shifting prices and information, the past few years’ industry data points to another important trend: growth incentives will be harder for retailers to achieve in 2024.
Add in inflation, and this era is already throwing plenty of hurdles. Retailers need better tools to help clear them.
“How did we do last year?”
You want to make the transition from one program year to the next as smooth as possible.
And you know that in order to look forward, you need to look back first. But if your program or earnings data from last year is inaccurate or messy, it adds layers of complexity to any kind of evaluation.
According to our data, 60% of SKUs on the average Ag retailer’s Excel-based net sheet have rebate program data entry errors. So, more than half the products on net sheets have some level of inaccuracy — making your decision-making that much harder.
If you work in supplier management, you need the right info at your fingertips to make the best purchase decisions. You need visibility over internal requirements (what did supply and demand look like last season?). And you need visibility over where there are financial opportunities from rebates. Even if these haven’t been published yet for this year, looking at last season’s program-specific data can guide you initially.
Beyond the micro-level program data from last year, you also need its bigger story. Are your end-of-season margins what you expected them to be? If you’ve missed, is your team showing you which supplier programs you didn’t take advantage of?
These are all questions that can or make break your next season — and they’re the ones that need to be answered in the coming weeks.
“What are we going to do this year?”
Let’s be honest: this time of year can be frustrating for anyone trying to inform a sales team of program and pricing opportunities.
How can you make sure you’re entering into those prepay conversations with correct pricing… if you’re not even sure what manufacturers’ rebate programs are going to look like next season?
You’re flying blind until that information gets sorted out at the supplier level — and then filtered down to you.
There’s already a gap here you have to overcome. Some supplier programs won’t publish until late November or even December. But when your own digital communication and technology adds more time to that gap, that’s when retailers start to fall behind.
With better digital infrastructure that empowers smoother reconciliation, faster communication with suppliers, and more 360-degree visibility over programs and pricing, you can hit the ground running faster once those programs do officially publish.
With more real-time updates (via a singular platform), you can get to the right prices and the right nets faster. You don’t want to waste precious time selling at the wrong price, just because you hadn’t received the updated spreadsheet with program details.
But unfortunately, this happens incredibly frequently in the industry. Data shows that up to 12% of all invoices to growers contain pricing errors.
More robust, accurate data doesn’t just help the sales cycle, though. The more information you can get your hands on, the better you can forecast into the future.
Details about supplier rebate programs will trickle in over the next several weeks. But even as you wait, make sure you build a solid understanding of what went right (or wrong) in the business last year and where potential opportunities could lie next season.
It’s also a good time to think about what forecasting systems you have in place to prevent overstocks or undersupply. How is your visibility over demand? If you don’t have a clear answer, now is the time to figure that out.
To build more visibility — over programs, pricing, supply forecasts, and more — you need the right data.
How Smartwyre enables better supplier management
In a supply chain that has traditionally seen so much data inaccuracy and bloated systems, it’s no wonder transitions from one season to the next can be rocky sometimes.
But with the right technology at your side, you can make this in-between time much smoother.
With Smartwyre’s solutions (like earning, costing, and planning), you can:
Have a single, standardized view of all supplier programs, pricing, and transaction data, so you can optimize rebate programs and maximize profits
Connect with suppliers so that you get product and pricing updates daily
Rely on the software to automatically calculate expected costs, which helps you make better buying decisions
Automatically calculate incentive programs to ensure you’ll have accurate net product pricing from suppliers at all times
Publish updated price lists instantly to your sales team
Operating with old-school methods can be fine for a while. But as your business scales up in complexity and you’re involved in more and more incentive programs, those processes will feel more and more outdated.
It doesn’t have to be that complicated.
When you run your operation on a platform that was built specifically for those Ag Retail-sized potholes, this time of year can start to feel a lot less stressful — and more like an opportunity to shape your future.
