Turning key customers into strategic planners

Cindy Banaria

Cindy Banaria is the vice president and national key accounts head of Nestle Professional, the food service arm of Nestle Philippines Inc. She was with the Magnolia division of San Miguel Corp. before moving to Nestle in 1996.

Her career in key accounts spans 26 years and counting, initially handling supermarkets and convenience stores before moving to  food services.

She has received a number of sales awards internally and from customers—the latest of which is Sales Region of the Year for Nestle Professional in 2019, Nestle Exemplar for Leadership. She was also part of the Grand Champion Team in Nestle’s ILAW (Innovation Award) 2020, a testament to her savvy.

Here, Banaria talks about the importance of internal collaboration and alignment when the opportunity to do joint business planning with key accounts comes up.

Q: What is the idea behind joint business planning by manufacturers and retailers?

A: The idea behind joint planning is to align one’s programs to the thrusts and directions set by the customer and ultimately agree on specific programs. Customers in this case refer to big global and local food chains with centralized delivery points and high requirements for key accounts servicing.

Key here is understanding the customer’s needs and how one can add value to the business partnership. It is all about helping trade partners win in out of home.

Q. What are the prerequisites to joint business planning?

A: In doing joint business planning, one should have a detailed customer fact sheet. The supplier and customer should be open to provide valuable information, e.g. current performance, potential new categories/products in the pipeline, and identified areas for growth.

This will include data on number of current branches and planned expansion; size of business for the past two to three years and the target set for the following year. From these, the priorities and common growth platforms are derived. List what worked well (Keep); can improve (Adjust) and doesn’t work (Stop) for the customer.

Q: What are the key steps in joint business planning? What are the typical timelines?

A: After completing the customer fact sheet, priorities and identifying common growth platforms, one will identify major objectives with the customer for the following year.

Normally, the customer provides a brief to the supplier including general directions for one to two years, e.g. categories to grow and calendar for new products. Supplier aligns internally and presents trends and proposed concepts to the account via ideation. Strategies are identified with corresponding details on initiatives and tactics.

Typical timelines start as early as quarter three and ends before year-end. Signing of the calendar of plans can be done toward the end of the year and extends to the early part of the succeeding year.

Q: What are pitfalls to avoid in joint business planning?

A: Major pitfalls include not understanding the customer and putting one’s interest as main consideration in the joint business planning. Partnership is a marriage of two—the supplier and the customer. It is putting the two together for a more effective planning. One should always bear in mind—What’s in it for the customer?

In some instances, there are customers that do not share their plan as well as they consider it highly confidential.

Q: What trends have you observed in joint business planning nowadays versus when it was a relatively new engagement practice?

A: Most of the customers have already set schedules in their calendar for the joint business planning with selected suppliers. In the past, only a few key accounts would do joint business planning.

When it was a relatively new engagement practice, set common programs are shared by the supplier with the customer. Sometimes, these are forced on the customer, which oftentimes will not really work. Nowadays, a big chunk of time is spent on understanding the customers very well and imbibing their directions and thrust for the following year. It is listening more than talking.

As they say, you have two ears and one mouth—so we use it in that proportion. By understanding the customer, one is able to prepare plans and programs attuned to the directions set by the customer. There will be a bigger likelihood of approval of the plans and programs presented.

Q: Have there been situations where unintended consequences made joint business planning detrimental?

A: One thing very distinct with key accounts is their requirement for differentiation from the products, the solutions and to the activities mounted. There is a higher probability for customization for big customers. There may be instances where the customers are not happy when they find out that certain promotions are done with other customers as well. Even though these were agreed upon during the joint business planning, once implemented with other customers, these will be an area of concern.

Sometimes, joint business planning is also misconstrued as the final direction of the account. In reality, account’s plans may change based on the latest trends and market. The challenge for the supplier is  to be proactive,  anticipate trends that come out after the joint business planning and act on the trends with new products.

Q: Can you share with us one or two examples of significant results that came out of your joint business planning?

A: At the onset of the pandemic, dine in business significantly declined. Takeaway, delivery and drive thru transactions increased. The beverages business for out-of-home is the most affected category. How can out-of-home recover the big margins lost in beverages with the huge drop in dine-in?

This was one of the major concerns raised by the customer. How can the manufacturer help with the current situation. We had to pivot our business from providing beverages solutions for dine-in and shift to being part of the takeaway and delivery solutions. Thus the birth of the bottles solutions for Nestle Professional.

This business model will include dispensing beverages in store from the dispenser to the bottles. The bottles will bear labels of the customer and will include a space where customer can write date of bottling. This will give artisanal and freshness perception of the product. Other than that, margins achieved are way better than the ready-to-drink pet bottle available in the market. This creative solution has paved the way for the customer to get back the lost margins in beverages served for dine in. Consumer tests also showed very high acceptability of the bottle project.

Another example that came out of the joint business planning is providing accounts with new recipes that can address the heightened health awareness of customers and the need for one-step procedure products. This is aligned with the concern over the reduced manpower at the branch level due to the pandemic. —CONTRIBUTED

Josiah Go is the chair and chief innovation strategist of Mansmith and Fielders Inc. Attend his Continuum Academy’s event “Opportunity Seeking When Growth is Difficult” and “Evaluating Business Model Risks” on June 29. Email [email protected]