POS Data Collection Whitepaper by Computer Market Research

Best Practices For Collecting Sales Data from Channel Partners

Best Practices For Collecting Sales Data from
Channel Partners
First in a Series of Channel Information Management White Papers from Computer Market Research.

Over the past 20 years,
Computer Market Research, Ltd.
has perfected its method of
obtaining raw POS data from
distribution partners. This white
paper details the implementation

8
of a fluid collection process that
funnels raw channel data from
reporting partners into point-of-
sale (POS) reports of business
intelligence that can be used
for future revenue generation.
In eight easy steps, this white
paper will demonstrate how our
Fortune 500 clients obtain, use
and depend on the sales data
acquired.

steps to success:

© COMPUTER MARKET RESEARCH, 2007

Best Practices For Collecting Sales Data from Channel Partners

Table of Contents

Executive Summary

01 Define Management Challenges 05

02 Set Management Goals 06

03 Implement an Effective Collection Method 06

04 Construct Prior Agreement for Collection 07

05 Simplify the Collection Process 07

06 Import and Clean the Data 09

07 Feedback 12
8 steps program:
08 Share the Value 13

Conclusion


Best Practices For Collecting Sales Data from Channel Partners 03

Executive Summary
Business Challenge
The customer is the most vital aspect of any business. The in-depth knowledge
of the customer and the point-of-sale activity is an essential aspect of any suc-
cessful marketing and sales strategy. This information can only be gathered with
a comprehensive collection process from the distribution channel. High-tech
companies selling through two and three-tiered distribution channels rely on the
point-of-sale (POS) information that arrives from reporting partners. The accuracy
of this information is therefore imperative to the success of any strategies based
on it.

Once the manufacturer has overcome the cumbersome task of obtaining the
sales data from the channel, a new set of challenges arise; cleaning, standard-
izing and processing the raw data files into business intelligence used for future
revenue generation. When the information is at its most accurate, the challenge
becomes how to best present the information intelligently.

Additionally, manufacturers cannot afford to wait for quarterly sales and inventory
reports to actively adjust inventory for enhanced selling opportunities to freshly
identified customers. They must be able to access the data on a weekly or
monthly basis.

Solution Description

Computer Market Research (CMR) has developed and perfected several channel
data management applications that alleviate the challenges of collecting, process-
ing and interpreting POS data from reporting partners, such as wholesale distribu-
tors, retail store chains, online resellers, and other channel partners.

Solution Benefits

Accurate, complete and timely sales records arriving from the channel regard-
ing specific aspects of all individual sales provides the manufacturer with crucial
weekly and monthly information about who, when, why, where and how the
products were purchased. With an optimized practice for collecting data imple-
mented correctly, business intelligence is generated for channel enhancement.


The manufacturer can utilize this information to pay the sales force, create
productive marketing strategies, optimize channel efficiency, comply with
Sarbanes-Oxley laws, enhance CRM and PRM approaches and speed up
the sales cycle – all key aspects in driving greater profit, market share and end-
customer satisfaction.

Over eight steps, this guide will detail how to implement the most successful
channel partner data collection methods, as proven by many of the most
prominent high-tech corporations in the industry.

“I can seamlessly import the data, notice sales trends
and better manage the US and Canadian field staff.
The ChannelPOS reports sit on my desktop all day
long. I live and die by this data.”
- Bryan Levine, VAR Sales, Netgear, North America



Step 1
8 steps to success:
Define Management Challenges
The first step to implementing any new strategy includes a com-
mitment to a plan. First, schedule an executive meeting where the
department directors can discuss the current internal challenges of
gathering data from the channel. Some questions that should be
addressed are:

Information Technology
• How cost-effective is your company in obtaining the information from the
channel?
• Do you have a method of cleaning and standardizing the data obtained from the
channel?
• Do you currently have any methods of enhancing the data?
• Does your current reporting process give you adequate insight into changing
marketing strategies?
• Do your current collection solutions integrate fluidly with vendors of CRM,
PRM, Sales Compensation and Financial applications?

Finance Department
• What is your current company procedure for compensating the sales team?
• How do you accurately recognize revenue traveling through the channel?
• How do you currently process partner incentives?
• Is maintaining price protection a constant challenge?

Sales Department
• What is your current company procedure for motivating the sales force?
• Do sales data and technology assist in your lead management process?
• What are your current strategies for pipeline management?
• Do you have an effective way to forecast sales?
• What are your current company procedures for special pricing?



2
Marketing Department
• Does your company currently have a simplified method of adding new resellers
to your network and database?
• How efficiently does your company issue COOP/MDF funds?
• What are your current procedures for calculating marketing program return-on-
investment (ROI)?
• What are your current procedures for issuing rebates and spiffs?

Set Management Goals
Collaborate to create firm goals of what your company intends to achieve by
collecting the POS data. Essential information may include channel customers,
successful products and the sales trends they have created.

Identify Your Distributors
• Would you like to easily merge multiple distributor POS files for analysis?
• Would you prefer to have your sales and marketing personnel receive channel
information that allows them to better understand their business, offload
administrative tasks and focus on their specific duties?
• Would you like to alleviate headaches from partner rebate validations?

Identify Your Resellers
• Is making the commission payroll a monthly headache?
• Do you need to better police channel returns?
• Is full Sarbanes-Oxley compliance seemingly unattainable?
• Are you spending too much time and money attempting to optimize your
channel?

Identify The End Users
• Who are your top customers and what vertical markets are they in?
• When do you acquire new customers?
• How can you increase your sales to customers demographically?

Identify Your Products
• What are your top products that are being sold and why, where and by whom?
• How can you make improvements on products that are not at their optimum
selling capacity?
• Is balancing inventory and price protection a concern?

Implement an Effective Collection Method
Once the goals have been determined, decide upon and implement a method of
attaining the goals. Consider factors including the effectiveness of the collection


time and effort spent internally. Management must analyze if the hardware, soft-
ware and human resources necessary for proper data collection are worth the final
results.

A company can waste valuable time tracking reporting partners who are continually
behind schedule. If the sales records are unattended for lengthy periods of time, the
sales departments are losing money and valuable direction. Once the data arrives,
Information Technology departments are constantly burdened with the repetitive

4
process of manually clarifying the data that arrives from the channel. Through finan-
cial analysis and a comprehensive ROI process with management, decisions can
be made about when it is more cost-effective to outsource the collection and data
processing to a single company that can easily resolve all of the defined manage-
ment challenges.

The CMR Channel POS online application easily imports, cleans and processes
the POS data files into useful information for decision-makers. Channel POS also
links to a variety of products that enhance communication and effectiveness of the
distribution channel. These products combined, alleviate all management challenges
defined in step one and achieve all goals decided upon in step two.

Construct Prior Agreement for Collection
It is essential that an agreement be developed and approved by both the manu-

5
facturer and the reporting partners. Based on the goals stated by the department
heads, the agreement must state specific needs concerning the exact methods of
obtaining the POS records from the reporting partners, avoiding simple agreements
to “collect the data in a timely manner.
”

The agreement should state specific needs, including the day and date that the file
is due, the rate at which the reporting occurs (month/week/day), the type of data
that is expected and the format that this data will arrive in, the repercussions of a
late file and rewards for on-time reporting (See Section 8 – Share the Value).

Simplify the Collection Process
The manufacturer must provide receiving methods that are reporting partner-friendly
and identify critical-to-quality data fields. They are providing data that business activ-
ity depends on. The more reporting methods and file formats allowed, the greater
the chances of accurate, complete and timely reporting. Some essential methods
include:

• An email attachment
• FTP Push


The CMR Compliance
Wizard saves time and
money by allowing the
reporting partners to enter
the POS data directly into the
database.

• FTP Fetch
• A Website that is linked to a database

CMR accepts all reporting partner formats.

Excel Files

• XML Files
• ASCII Text Files
• Comma Separated Values (CSV)
• EDI Files



Tab-delimited Text Files

6
Import and Clean the Data

Once the file has been
received, import and audit
the raw data file, in
preparation for processing.



To ensure accuracy and data
protection, CMR imports the
file into a temporary generic
template for preliminary
review. In this stage, the file
is standardized before it is
uploaded into the database
for processing. CMR’s
Channel POS application has
many pages, like the one
shown below, that allow the
user to quickly standardize
any aspect of the sales data
files that arrive from
reporting partners that do not
match the information stored
in the database.

Management can easily
specify which fields of the file
should be uploaded into the
database, in a process known
as mapping.



Verify that the file was
processed correctly and
critical-to-quality fields are
present and valid.

Track the file as it is
received, imported, cleaned,
migrated and
processed.



Create accurate, clean and
configurable reports based
on the data generated.

7
Feedback

Confirm via email with the
reporting partners that the
files were received.



If the file is late, use an
automated reminder
system that delivers emails
of escalating urgency to the
late reporting partner.

Create a report that
ranks their reporting
performance, to allow them
to improve their methods.

8
Share the Value
The reporting partner should be made aware of the importance of their contribu-
tion. The manufacturer can use the sales reports as a tool to advise the partners
of methods of enhancing sales opportunities by providing the partners with sug-
gestions of possible leads. Effective reporting partner motivators include rewards
like leads, rebates, spiffs and Co-op/MDF money. Greater amounts of selling
reward all levels of the channel.



Conclusion
Without knowledge of the customer, management can only guess how to sell
a product. Point-of-sale records obtained from reporting partners contain this
crucial and fundamental information. When reporting partners are content with
an optimized channel information collection and reporting process, manufacturers
gain business intelligence on vital customers that translates into future revenue.

About Computer Market Research
Computer Market Research, Ltd. (CMR) is the industry’s leading solution provider
of POS data management applications for the distribution channel. For over 20
years, CMR’s web-based and hosted software applications have accelerated and
automated distributor and reseller data collection, processing, analysis and
reporting. Clients like Hitachi Data Systems, palmOne, Samsung, Roxio and Sym-
bol Technologies, rely on CMR to improve their POS data management process.

Sales Contact:
Rick Bussell, VP of sales
rbussell@computermarketresearch.com

For more information, visit us at
www.ComputerMarketResearch.com.

POS Data Collection Whitepaper by Computer Market Research

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POS Data Collection Whitepaper by Computer Market Research