Refresh Distributor Rewards Structure

Client – One of the top 5 dairy companies in the world
Region – Indonesia

Context

• Client wanted to understand how to restructure the Distributor commercials/ overall reward structure to ensure distributor actions are directly linked to principal company performance, whilst ensuring motivation for distributor sales team

Action

• Developed a project structure where both qualitative & quantitative assessments were deployed to propose potential options on the new reward structure
• Qualitative assessments were undertaken via field visits & face to face discussions with distributor’s teams
• Quantitative assessments were undertaken via development of a detailed Cost-to-Serve Analysis tool (measuring Distributor Profitability)

Results

• 3 potential options on the new reward structure were proposed linked to Principal company’s success parameters
• The adopted option was a performance based reward structure,  which was also highly motivating for the distributor’s sales force