Managing The Indirect Sales Channel

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Agenda Introductions Challenges Oracle’s Trade Management Solution Key Product Capabilities Roadmap Questions

Channel Management Challenges Need to know Revenue and Liabilities Sales Data comes from Direct and Indirect Sales Sales to Customer, Resellers, Distributors, Retailers Need to track Complex Rebates and Volume Incentives Account for my Rebates Need to Cleanse and validate POS Data Need to track Buy Side and Sell Side Activity POS Communication via EDI and files Some Distributors are also Customers Customers buy from multiple sources Need to Process Claims and Deductions Regulatory Compliances

A Need for Change Leading Business Trends Increasing manufacturer-channel collaboration Customer investments based on total cost to serve End-to-end solution across Finance, Supply Chain & CRM Strong internal controls to comply with regulations Single, integrated view of customers & products

Oracle Marketing Oracle Sales Quoting iStore Trade Management Budgets Management Pricing Rebate Management POS Management Claims and Settlement Order Management Pricing Inventory Financials Customer Data Hub Customers, Suppliers, Products, … Customers, Suppliers, Products, … Develop Market Sell Order Plan Procure Make Fulfill Service Maintain Finance HR Projects Contracts The Oracle EBS Channel Solution

Oracle Trade Management Channel Solution Footprint Budgets/Funds Offers/Pricing POS Management Deductions & Settlement Integration with Financials

Business Flow Benefits Centralized view of trade budgets Controlled trade spending Support for all budget processes Shorter time to distribute funds Create Budgets Define Eligibility Define ThresholdsAllocate Budget Planning Set Foundation for Tracking Spending

Support Key Budget Types - Fixed - Fully accrued Manage Budgets at Multiple Levels - Territory - Buying groups - Customers Configure Alerts for Potential Overspend and Underspend Automate Allocation to Sales Hierarchy Enable Top-Down Bottom-Up Budgeting - Sites - Product family - Products Complete Set of Budgeting Capabilities Improve Administration Flexibility and Effectiveness

Program Checkbook Hierarchy Tree Rollup View Customer Checkbook Fund Balances Global Budget AmericasEMEA Asia PAC Others U.S.Canada Latin Am. Total Planned Committed Utilized Earned Paid Oracle Trade Management Provide Visibility to Budgets

Example: Budget Hierarchy View Track Total Spending and Accrual Levels All balances, with drill-downs to details N levels of budget hierarchy

Oracle Trade Management Channel Solution Footprint Budgets/Funds Offers/Pricing POS Management Deductions & Settlement Integration with Financials

Offer Types Off Invoice Volume Pricing Promo Goods Order Value Lump Sum Terms Upgrade Scan Data Net Sales Accrual Comprehensive Program Types Provide Multiple Pricing Options to Users Complete Integration to Pricing & Order Management

Comprehensive Volume Pricing Complex Discount Programs Purchase Volume % Discount Product 3 Customer A Customer B Customer C Customer D Purchase Volume % Discount Product 2 Customer B Customer C Purchase Volume % Discount Product 1 Customer A Customer B Customer C Define Pricing Agreements Specify discount eligibility by customer, product, market, date Define discount tiers by quantity, dollar amount Define discount amount by percent, dollar amount Create combined volume offers Simplify Administration Create all volume offers for customers from a single screen Assign a volume offer for a product to one, many, or all customers Support direct and indirect sales

Business Flow Benefits Avoid unwarranted discounting Promote to the right customers with the right products Ensure effective use of budget Avoid unwarranted discounting Promote to the right customers with the right products Ensure effective use of budget Forecast Calculate ROI Define Pricing Buckets Create Offers Validate Eligibility Promotional Planning Plan and Analyze Before Execution

Account Manager Dashboard: Planning Enable Account-Level Planning View all planned and current promo activities Set sales target Find past offers to baseline new offers View promotion gaps & overlaps Forecast revenues and expected ROI

Promotional ROI Impact of Discount ROI Projection Calculate Expected Net Impact of Promotional Spend Integrate with 3 rd party demand forecast systems to calculate baseline sales and lift Automatically retrieve cost of goods from ERP system Calculate ROI based on sales forecast

Account Manager Dashboard Evaluate Account and Product-Level Performance Sales vs. quotas across multiple timeframes Sales trend and year-to-year comparison Performance by account Performance by product Action alerts triggered by sales target thresholds

Retroactive Adjustments Manual Adjustments Automatic Adjustments Fund Reconciliation Fund Transfers Identify underspent funds and return them to available budget Identify underspent funds and transfer them to other promotions Adjust promotion rate for past sales orders based on customer purchase volume Make ad hoc changes, e.g., for a missed activity Adjust promotion rate, e.g., for scan-through performance Comprehensive Adjustments Total Flexibility

Complete Funds Tracking Process Provide Visibility into Expense and Liabilities Funds Accrual Engine Sales Orders Monitor Fund Usage View Committed vs. Utilized vs. Paid

Workflow Driven Approval Process Provide a Strong Internal Control System Budget creation Budget allocation Promotion fund request Promotion adjustments Claim settlement Trigger Outcome Workflow Engine Automated approvals Complete audit trail

Oracle Trade Management Channel Solution Footprint Budgets/Funds Offers/Pricing POS Management Deductions & Settlement Integration with Financials

Provide Incentive to Both Distribution Channel and End Customer Manufacturer Distribution Channel End Customer Indirect JE/Accruals Indirect Sales Data Table Indirect Sale Sale ClaimsProgram Payments Import & Cleanse POS Data Indirect Sales (POS) Data XML, EDI , Other Outputs Identify Applicable Promotions Run pricing simulations Validate compliance to pricing agreements Validate against special pricing requests Oracle Channel Management Indirect Sales Accrual and Sell - Through

Channel Inventory Tracking Visibility into Channel Inventory Track inventory throughput View channel inventory by account

Oracle Trade Management Channel Solution Footprint Budgets/Funds Offers/Pricing POS Management Deductions & Settlement Integration with Financials

Business Flow Create Claim/DED Assign Owner Research Approve & Settle Benefits Minimize the cost and time required to clear claims & deductions Identify and collect invalid claims Proactively prevent deductions Efficiently process promotional payments Minimize the cost and time required to clear claims & deductions Identify and collect invalid claims Proactively prevent deductions Efficiently process promotional payments Adjust Financials Oracle Trade Management Claims and Deduction Process

Research and Administration Tools Efficiently Investigate Deductions Flexible assignment (by territory, other) By claim type By claim reason Multi-level split Look Up Information Assign Owner Categorize Issue Find Duplicates Split Claim Track Claims Aging Configurable aging buckets Manage Task Team access Task assignment Document Investigation Notes and attachments Maintain Audit Trails Change history Search by customer reference number Ad hoc reporting Promotional accruals search

Auto Resolution Auto Pay Mass Settlement Automated Settlement Reduce Resolution Cycle Automatically create Credit, Check, RMA, Write-Off, Chargeback, Debit, On Account Cash, Contra Charge for claims below set threshold amount Issue periodic payments based on customer preferences to proactively minimize deductions Resolve multiple claims at once by offsetting deductions and overpayments

Oracle Trade Management Channel Solution Footprint Budgets/Funds Offers/Pricing POS Management Deductions & Settlement Integrations with Financials, OM and Pricing

Claim number Reference Reason Close claims with transaction numbers Integration with Receivables Streamlined Deduction Process Create and assign claims Settle Claims Create and apply transactions Adjust Accounts Receivable Research and approve Receive cash from customer Apply cash with discrepancies

Direct Sales Indirect sales (POS) Chargebacks Net sales calculations Scan data offers Lump sum offers Retroactive adjustments Other adjustments Sales Orders & Claims Accrual Engine General Ledger Apply Proper Accounting Rules Minimize Financial Risks with Upfront Accruals Post accruals and claims to GL with option to post off-invoice promotions Account for promotion as a reduction in revenue or as an expense Post accruals and claims to GL with option to post off-invoice promotions Account for promotion as a reduction in revenue or as an expense General Ledger Postings Accuracy and Compliance

Workflow Driven Approval Process Provide a Strong Internal Control System Budget creation Budget allocation Promotion fund request Promotion adjustments Claim settlement Trigger Outcome Workflow Engine Automated approvals Complete audit trail

Oracle Channel Management Suite Roadmap

Oracle Trade Management Product Growth Enhanced Trade Profiles Optional Supplier Ship & Debit Distributor Price Protection –Spawned from TM Product Evolution and Split Accounts Receivable Deductions and Claims Advanced Rebates & POS Management POS Inventory Enhancements POS Based Revenue Recognition

Request Special PriceTrack Accruals Manage Disputes & Payments Request New Price from Supplier Receive Supplier approval/ authorization Record Accruals Generate Accurate Accounting Compile accruals & generate Claims Transmit Claims to Supplier via XML or WebADI Resolve Disputes Issue Debit/Invoice to Suppliers Vendor Claim/ Bill Back Supplier Ship & Debit Oracle Supplier Ship and Debit enables Distributors across Industries to more quickly and intelligently respond to market conditions by automating special price requests to Suppliers. The solution is geared towards reducing the cost of managing special pricing agreements and to provide greater visibility into the claiming process

Price Protection Integration Points  Procurement  Warehouse / Inventory  Costing  General Ledger  Accounts Payable  Accounts Receivable Oracle Price Protection is integrated out of the box with Oracle EBS

Channel Management Meeting Challenges with Trade Management Increasingly complex business processes Effective allocation of funds to promotional activities Increased focus on forecasting and performance tracking capability Complex Accrual Processes and Adjustment requirements Channel and Indirect Sales data visibility and tracking Increased cost of Claims and Dispute investigation CHALLENGES Budget and Quota allocation Account Manager Dashboard for sales analysis Promotional Lift calculation based on Third Party data. Backdated adjustments and retroactive pricing capability Indirect Sales data tracking and third party accruals Integration flows for partner fund management and Special Pricing Mass settlement and Auto Pay capability Automated Claim creation and settlement processes Increased sales efficiency and effectiveness Streamlined Fund and Quota Management process Ability to manage complex pricing programs Monitor promotion performance and control promotional exposure Effective liability tracking based on direct and indirect sales data Visibility into channel inventory Minimize claim investigation and processing costs CAPABILITIESVALUE

Oracle Marketing Oracle Sales Quoting iStore Trade Management Budgets Management Pricing Rebate Management POS Management Claims and Settlement Order Management Pricing Inventory Financials Customer Data Hub Customers, Suppliers, Products, … Customers, Suppliers, Products, … Develop Market Sell Order Plan Procure Make Fulfill Service Maintain Finance HR Projects Contracts The Oracle EBS Channel Solution

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