The battle to optimise Trade Terms Spend & how technology is helping Consumer Products companies fight it

Every year Consumer Packaged Goods (CPG) organisations spend huge sums on trade spend (TTS, or Trade Terms Spend), with some statistics putting this figure at over 20% of total revenue. Trade spend describes the money that CPGs pay to their customers, the retailers, to incentivise them to increase consumer demand for their products. Most of this amount relates to promotional activities. 

Unfortunately, there are several factors already eroding CPGs power in customer negotiations that are likely to increase this percentage in the future. These include new channels dominated by highly competitive customers such as internet retailers and discounters, and pressure now being exerted by some traditional customers combining their bargaining power into buying groups.