Goal
The company has lately experienced an intense development of its distribution network, accompanied by a challenging company merger. In this context, the Data warehouse and Commercial Bis Retail budgeting aim towards supporting process innovation and commercial rationalisation.
Why did they choose E3 Suite?
- Software solution with a preconfigured database, easy to be parameterized
- Software supported by consultants highly experienced in the retail sector
- Bis Retail also supports the Oracle platform chosen as the primary technology to develop the company’s information system
- Bis Retail offers various application solutions that can guarantee the full evolution of the management control function for the following years
- Bis Retail can work in cooperation with the team using internal resources, providing training in order to obtain knowledge and autonomy to manage the processes
Overview of the 4GH Commercial Budgeting Process
In December 2006, 4G Group decided to activate the Commercial Budgeting solution. They are one of the largest European telephone distribution companies due to their recent merger with other companies of the sector, and have more than 300 stores in Italy. The Commercial Budgeting solution focused on the integration of the sales network activities distributed on national territory, on the purchasing department managing product categories for different suppliers and brands and on planning the volume of purchases for 2007. Before introducing E3 Suite, the sales budget was performed separately from the purchase budget, without having an integrated and unitary overview of what was being planned for the sales network. Thanks to E3, two integrated and perfectly harmonized processes were developed that follow these steps:
- Sales Budget: Based on the internal trends of volume and price, along with market trends. It was organized referring to the store / product sector according to the rules defined by the administration and control office; after this process the budget was distributed to area managers (divided into the stores that they manage); area managers could apply financial corrections and submit the updated budget to the central office; after being integrated with the corrections, the budget is confirmed by the E3 data warehouse system;
- Purchase Budget: Once the annual sales budget was confirmed, the E3 system divided it into months based on historical sales data per month/product category and also on the mix of brands (supplier) in order to activate the sales budget in terms of product category; each buyer/category divided their product categories according to the margins and market trends recorded in external databases of their past financial year; every buyer/category could review the range of their categories, repositioning their suppliers based on three factors: the share, each supplier is allocated within its category, the selling price and the purchase price. After having finalised the purchase budget, it was confirmed by the system and generated a purchase plan and the presumed structure for 2007; both the purchase and sales budget are available on the data warehouse system for comparison with 2007 final data.
- Goal management: Once the budgeting process was finalised and confirmed, it generated sales function Goals, in terms of mix and margins for both stores/sales representatives, where the Goals were represented by the value and quantity of items sold on a monthly, weekly and daily basis. The support provided by the IT team but especially by the team controllers Lorella Bianchini and Filippo Pavesio was of paramount importance. They contributed in terms of methodology, support and internal functions coordination.
