One Blog |May 15, 2017 | POS Tracking Software
A Guide to Help Beverage Alcohol Distributors Evaluate and Select a POS Tracking Tool
Mark Fullerton and Denis Clark
2017 marks our twelfth year working with beer, wine and spirits distribution companies of all sizes in 33 states. Ten of the Top 20 distributors in the USA have chosen OnTrak.
We’ve learned from our customers that their point-of-sale (POS) programs are critical to overall sales success but also represent a growing and uncontrolled expense. They say that before OnTrak, very little was being done to track these expenses. The thinking was, and in many companies, still is: “POS is a necessary expense. It works and helps to increase the sales of existing brands and to introduce new brands to the market.”
As important as POS marketing is, many distributors still approach POS tracking and management with manual methods or with a combination of email forms and spreadsheets. Inertia is difficult to overcome sometimes, but due to tightening margins, coupled with POS marketing program costs on an upward trajectory, many beverage alcohol distributors now see a POS tracking and management system as a solution to their POS problems.
A Customer’s Experience
“POS is an important tool to leverage our sales team and increasing sales,” says Jennifer Doering, President and General Manager of a medium-sized Kentucky A-B distributor.
“In 2005 when we started down the path of deploying our first POS tracking, measuring and management system, we used to say, POS was a black hole. With over 10 years of experience using a POS tracking system for custom POS and permanent POS, I can tell you there are excellent business reasons for adopting a POS tracking system. This includes improved cash-flow of our POS programs, lower marketing costs, and the ability to know what POS promotions work well – and which ones that don’t.”
Before We Get Started with the Guide
At first, we thought publishing a blog that serves as a “guide to evaluating, selecting and implementing” a POS tracking tool, might be disingenuous since we are the developers of such software. But, the more that we thought about it, the more it seemed logical to do so, especially considering that all of our POS tracking products were designed by our prospects and customers.
We’ve taken input from distributors of all sizes from across the country. Our POS tracking, measuring and managing tools truly represent the Best Practices of hundreds companies representing tens of thousands of users. Our products – and our customers – benefit from the fact that our solutions are tailored to the needs of beverage alcohol distributor’s business.
We’re convinced our POS tracking software is the best on the market, but in this blog, we will provide you with an objective approach to selecting the POS tracking and management tools you will need to make an informed selection. We’re optimistic you will select ours.
Step One: Don’t Overlook the Goals You Want to Achieve with a POS Tracking Solution
The first step in selecting a POS tracking and managing system is to establish the goals you want to achieve or issue you want to address.
For some, the initial goal of adopting a POS tracking system is to automate the POS ordering and fulfillment processes. Make sure that the systems you select can eliminate errors and reworks, which will dramatically lower costs and speed your POS time-to-market. Getting your brand signs to the trade days before the competition is a real advantage in improving market share.
You also need to come up with your definition of what POS tracking means. For us, POS tracking means a set of software tools that are flexible and tailorable to the way you interact with your customers when it comes to ordering, producing, delivering and installing POS promotional materials.
You also need to select a system that allows you to accurately communicate your POS investment strategy to your suppliers, in hopes that they will reimburse you for that investment.
You may think you’re only looking for a system that imitates your current manual or inefficient POS ordering process. Instead, consider a system that does things better. A system that gets the POS orders placed, produced and put-up at-retail as efficiently as possible, and tracks the whole process.
Here’s a suggestion: If the system you’re considering does not achieve the goal of eliminating errors and reworks, does not dramatically reduce your production costs, and lacks the capability to get your POS materials to market ahead of your competition, then why change from your current system.
Step Two: Just Because You’ve Never Measured POS Before Doesn’t Mean It Can’t Be Done.
Once you’ve determined what you want your POS tracking system to do, then comes the time to broaden your objectives.
One of the benefits of using a POS tracking and management system comes from the data that it collects. With a POS tracking system, you will be able to identify exactly what you are spending on each POS marketing program. You will then have the ability to produce reports for your customers and suppliers as well as correlating this data with your order management system’s sales data. This creates a picture of POS spending compared with revenue either by customer, product or sales team.
In addition, you’ll be able to know how many POS programs you sponsored by customer, brand, SKU and rep, and exactly how much they cost. Given this data and the ability to compare POS programs to sales, you’ll be able, perhaps for the first time ever, to actually determine the ROI of your POS programs.
Many of the so-called POS features of today’s route accounting software or are basically good POS ordering systems, but not so good at measurement and management. Be careful.
Step Three: Tell Your Vendor You Want to See an Initial Live Product Demonstration
Set aside 30 to 60 minutes for an initial product demonstration. This is where you should get an overview of the companies you are evaluating: How long they’ve been in business, what are the key features and functions of their products and solutions, and what other companies are using their products.
If you have identified what you want the POS solution to accomplish (Step 1), tell the vendor in advance so they can show you how your objectives are specifically addressed by their software.
If this initial demonstration satisfies your primary objectives go to the next step and have a discussion about price. If they don’t meet your needs then price is meaningless. If the price seems high then ask the vendor to be specific about the benefits that will offset the costs.
Just make sure your needs match the benefits of their solutions. With OnTrak, often the elimination of errors alone more than pays for the product. But when discussing price find out if ordering multiple products, or increasing the number of users affects the price.
Big Tip – If a vendor says they can give you just what OnTrak provides for free, hold on to your wallet. You’re paying for it somewhere. How long would you stay in business if you gave your products away for free?
Step Three B: An Additional Product Demonstration May Be Necessary
Additional demonstrations may be necessary. There may be additional questions, or others in the organization who may be interested in digging deeper into the functions of the products that apply to them – General management, sales, marketing, print shop operations, inventory control, and even information technology.
Regardless of your role in this process each business function should participate in the evaluation process.
If you go to our website you will see a detailed description of the functions of your business that would benefit from the implementation of our software solutions. Click the following link:
During this more detailed demonstration, you may ask to speak to one or two of the vendor’s customers. We have a long list of beverage distributors of all sizes across the country who are more than willing to share their experience with you.
If everything at this point is satisfactory, the next phase would be to finalize a contractual agreement. The purpose the agreement is to get a commitment on price, terms and conditions, service level agreements, and everything that ensures that you will be successful.
Step Four: Implementation and Training
Once there is agreement on the terms and conditions of the contract, the vendor will schedule the implementation of the products. Our track record is to get our systems implemented in less than 45 days from contract agreement. Based on our experience here are some of the milestones that should be achieved.
- Initial Contact – The vendor should conduct an initial conference call to discuss the detailed steps in the implementation process with your whole team. Everyone needs to clearly understand their role and responsibility. Our goal is that other than obtaining your data, and understanding your business rules, most of the heavy lifting will be on our shoulders.
- Creation of Your Unique Website – The vendor will build a system customized to your business environment. It’s important to have a vendor that adapts their system to your business, not vice versa.
- Population of The Website with Your Data – The vendor will collect your product, customer, and sales routing information from your back-office system. The vendor should provide the capability to keep all information between their system and your business systems up-to-date and in-sync.
- Onsite Implementation and Training – And finally, the vendor should provide on-site, in person training for all potential users of the system. Our experience shows that two days is a good standard to make sure everyone is familiar with the system. It also allows time to run the systems with your data to make sure that the transition to the new systems is seamless.
A Word to the Wise – From the Experienced
Typically, the person who makes the final decision to move forward with a software application is not the same person who with be responsible for your project implementation team. But the success of such a project is directly proportional to the continued involvement of senior management in setting the vision and direction of the project.
According to our customers, “What you don’t want is an implementation team or an individual that wants to maintain the status quo. This is a time for change, not keeping things the way they were, or wanting to make sure the new software is implemented to protect the current practices.”
The implementation leader needs to believe that it is possible that the current business practices may be limited by the capabilities of the current system or a manual process.
The implementation of new POS tracking and management software is a great time to increase the efficiency of your teams and their processes, to add a new set of functions and capabilities to their sales and marketing toolkit, and to adopt best practices.
Having done this many times with hundreds of distributors, we know how to help you do this.
We hope this blog and the evaluation process we described is helpful to you.
While not totally unbiased, this guide is based on what our customers have done to achieve success and the expected benefits of implementing a POS Tracking solution. The benefits include: improving accountability with suppliers, lowering total POS costs, speeding POS time-to-market, and dramatically increasing POS marketing ROI.