Managing The Indirect Sales Channel

The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions.The development, release, and timing of any features or functionality described for EBS’s products remains at the sole discretion of EBS.

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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 LiabilitiesSales 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

ActivityPOS Communicationvia EDI and files

Some Distributors are also Customers

Customers buy from multiple sources

Need to Process Claims and Deductions

Regulatory Compliances

A Need for ChangeLeading 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 Thresholds Allocate

Budget PlanningSet 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 CapabilitiesImprove Administration Flexibility and Effectiveness

Program Checkbook

Hierarchy Tree

Rollup View

Customer Checkbook

Fund Balances

Global BudgetGlobal Budget

AmericasAmericas EMEAEMEA Asia PACAsia PAC OthersOthers

U.S.U.S. CanadaCanada Latin Am.Latin Am.

• Total• Planned• Committed• Utilized • Earned• Paid

Oracle Trade Management Provide Visibility to Budgets

Example: Budget Hierarchy ViewTrack Total Spending and Accrual Levels

All balances, withdrill-downs to detailsN levels of

budget hierarchy

Oracle Trade Management Channel Solution Footprint

• Budgets/Funds• Offers/Pricing• POS Management• Deductions & Settlement• Integration with Financials

OfferTypes

OffInvoice

Volume Pricing

PromoGoods

Order Value

Lump Sum

Terms Upgrade

Scan Data

Net Sales Accrual

Comprehensive Program TypesProvide Multiple Pricing Options to Users

Complete Integration to Pricing & Order Management

Comprehensive Volume PricingComplex Discount Programs

Purchase Volume

% D

isco

unt

Product 3

Customer A

Customer B

Customer C

Customer D

Purchase Volume

% D

isco

unt

Product 2

Customer B

Customer C

Purchase Volume

% D

isco

unt

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

ForecastCalculate

ROIDefine Pricing

BucketsCreateOffers

ValidateEligibility

Promotional PlanningPlan and Analyze Before Execution

Account Manager Dashboard: PlanningEnable Account-Level Planning

View all planned and current promo activities

Set sales target

Find past offers to baseline new offers

View promotiongaps & overlaps

Forecast revenues and expected ROI

Promotional ROIImpact of Discount

ROI ProjectionCalculate Expected Net Impact of Promotional Spend

• Integrate with3rd party demand forecast systems to calculate baseline sales and lift

• Automatically retrieve cost of goods fromERP system

• Calculate ROI based on sales forecast

Account Manager DashboardEvaluate Account and Product-Level Performance

Sales vs. quotas across multiple

timeframes

Sales trend andyear-to-year comparison

Performanceby account

Performanceby product

Action alerts triggered bysales target thresholds

RetroactiveAdjustments

ManualAdjustments

AutomaticAdjustments

FundReconciliation

FundTransfers

Identify underspent funds andreturn them to available budget

Identify underspent funds andtransfer them to other promotions

Adjust promotion rate for pastsales orders based on customerpurchase volume

Make ad hoc changes,e.g., for a missed activity

Adjust promotion rate,e.g., for scan-through performance

Comprehensive AdjustmentsTotal Flexibility

Complete Funds Tracking ProcessProvide Visibility into Expense and Liabilities

Funds AccrualEngine

SalesOrders

• Monitor Fund Usage

• View Committed vs. Utilized vs. Paid

Workflow Driven Approval ProcessProvide 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 DistributionChannel

End Customer

Indirect JE/Accruals

IndirectSalesData Table

Indirect SaleSale

Claims ProgramPayments

Import &Cleanse

POS Data

Indirect Sales(POS) Data

XML, EDIE-Mail, Other

Outputs

IdentifyApplicablePromotions

• Run pricing simulations

• Validate compliance to pricing agreements

• Validate against special pricing requests

Oracle Channel Management Indirect Sales Accrual and Sell - Through

Channel Inventory TrackingVisibility 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

CreateClaim/DED

AssignOwner 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

AdjustFinancials

Oracle Trade Management Claims and Deduction Process

Research and Administration ToolsEfficiently Investigate Deductions

• Flexible assignment(by territory, other)

• By claimtype

• By claimreason

• Multi-level split

Look UpInformation

AssignOwner

Categorize Issue

FindDuplicates

SplitClaim

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 hocreporting

• Promotionalaccrualssearch

AutoResolution

Auto Pay

MassSettlement

Automated SettlementReduce 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 customerpreferences to proactively minimize deductions

Resolve multiple claims at once by offsettingdeductions 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 ReceivablesStreamlined Deduction Process

Create andassign claims

SettleClaims

Createand apply

transactions

AdjustAccounts

Receivable

Researchand approve

Receive cashfrom customer

Applycash with

discrepancies

• Direct Sales

• Indirect sales (POS)

• Chargebacks

• Net sales calculations

• Scan data offers

• Lump sum offers

• Retroactive adjustments

• Other adjustments

Sales Orders & Claims

AccrualEngine

GeneralLedger

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 PostingsAccuracy and Compliance

Workflow Driven Approval ProcessProvide 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

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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 Price Track 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 PointsProcurement

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

CAPABILITIES VALUE

• 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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Q&A