1)Trade promotions are incentives paid by (consumer packaged products) manufactu rers to retailers for merchandising support.

They are used as a method to increase revenue. That means Trade Promotion Management deals with offering special dea ls to customers (retailers) for specific products for a specific timeframe to ach ieve incremental volume. a)The manufacturers offer various forms of value d actions in hopes of generating incremental volume and profit. in return for retailer promises an

b)It is importantto distinguish that these investments occur at two levels withi n a retail organization as shown in the middle column: at corporate level where the retailers commit themselves to the promotions and at outlet level where the promotions are executed and available to the consumers. c)cannibalization and pantry loading reduce the effectiveness of the money invested. The term cannibalization refers to the fact that sometimes when a product is promoted, it decreases another products sales; this could be a compet itor product but in some cases also an own product The term pantry loading refers to theretailers practice to overstock their inven tory to take full advantage of the promotional discount. TPM Key Trends and Challenges First, retailers themselves are becoming increasingly demanding, fully expecting that consumer goods manufacturers present promotion programs that are tightly integrated with consumer marketing campaigns and tailored specifically to the retailers individual needs and to the needs of their shoppers. Promotion activity, the traditional focus of the sales organization, has also become increasingly complex. In order to be effective, salespeople need to demonstrate that sales promotions drive both top-line and bottom-line growth for the products they sell and the categories they serve, and all at acceptable cost s.

And finally, sales people are increasingly called upon to move beyond simply relationship managers and become general managers, bringing to bear the full capabilities and resources of their organization to serve the needs of their ret ail customers. Example Biggest Business problem Related to Tpm

=)80%of companies surveyed rated Improving promotion effectiveness as one of their top three business problems related to the trade promotion process. =)About half of the respondents feel that they need to improve their sales forec asting. =)Not being able to accurately predict the effects of their promotions is a prob lem that also 41% of the companies surveyed mentioned. =)41% want better visibility into their spends and deductions. =)one third feels that they need to make better use of their demand data. =)Reducing spending is rated a big problem by also one third of all respondents. =) 18% feel that reconciling deductions is not handled well in their company. Trade Claims Management ===================== Example After the promotion has been executed payment of the promotional spends needs to be managed.claim analysts or key account managers need to validate the claim and al locate the cost to the promotional activity. Trade Claims Management (TCM) starts off during the Field Account Planning and Sell-in and Negotiation processes. Key Definitions and Key Capabilities ---------------------------------== Trade Claims Management allows organizations to allocate, track and validate trade promotion spending Track and validate trade promotion spending. ======================= Efficiently manage disputes according to agreed constracts. Automate the year-end redate and chargeback processing. Acces fund,promotion planning,validation,and clamin all at one place. valiadate retailactual performance to ensure the agreement is beging properly up help. integrated trade claims capabilities provide complete claims and deduction vali dation,as well as accurate accounting of all expenses. Trade Claims Management - Key Capabilities --------------------------------------Integrated trade claims management capabilities provide complete claims and deduction validation, as well as accurate accounting of all expenses to the corr ect funds. Trade Claims Management Features and Integration ============================================= All trade payments and reimbursements are processed through TCM. There are several SAP CRM objecst available to support this process like Deduction and Inv oice

Claim, Chargeback, Write-Off, Prepayments and Corrections. Trade Claims Management also serves as a central repository and is integrated wi th SAP SEM (Strategic Enterprise Management) to support form based claim validation . The main benefit of TCM is its tight integration with other SAP modules along wi th SAP ERP. Trade Funds Management Trade Promotion Management SAP CRM Settlements and SAP ERP Financials FSCM-Dispute Management (FSCM - Financial Supply Chain Management) Claim Types Overview-419 ================ deduction -Deduction Claims allow customers to claim the amount spent implementi ng a trade promotion from the manufacturer. The customer does so by not paying the whole amount of a manufacturers invoice. invoice -is an invoice request from customer to receive reimbursement for the p lanned or excuted trade performance. direct payment-is a onetime

configuration ====================== Trade Claims Management is a highly integrative process, the configuration is very complex. One of the major complexities are the interfaces to other SAP syst ems like SAP ERP and SAP BW. step 1 ========== customizing of the different transaction types which are required for the trade claims management process are explained. Steps 2 and 3 ========== describe the necessary settings for the approval and validation of the claim doc uments. Once a claim iscreated and reaches a specific status in processing, the funds de termination finds and assigns the relevant fund for the created claim. The Availability Control mechanism

checks if enough budget is available within the Fund to process the claim. Steps 4 ========== explains the relevant settings for the funds determination and the AVC check. Steps 5 ============== settings for the integration to dispute management are described. A transaction type controls how a specific business transaction is processed and can be used. Examples for transaction types are: Invoice Claim Deduction Claim Claim Submission Fund Funds Plan A transaction type is assigned to one or more business transaction categories.e. g. service, sales, activity). step1 *********************** Define Transaction Types ======================= 1. Define Transaction Types one specifies the description of the transaction type as well as important control attributes suchleading business transaction category, text determination procedure, partner determination procedure, status profile, organizational data profile, and number range assignment 2. Assign Business Transaction Category A transaction type can be assigned to one or more business transaction categories. Only certain combinations of business transaction categories are allowed. 3. Customizing at Header Level For each of the business transaction categories assigned, customizing settings f or the header level of the transaction have to be done. Various settings can be made here, depending on the business transaction category, e.g. validation sheet integration, prepayment integration, claim submission integration, approval procedure etc.

Approval (Step 2) ************************* Define Approver Groups and Thresholds Customer Relationship Management ? Claims Management ? Approvals ? Define Approver Groups and Thresholds The system checks if the user has sufficient rights to approve a budget posting, prepayment, deduction claim or an invoice claim. This is known as the threshold check. This check is performed when the user tries to set the status Approved at header or item level in the budget posting, prepayment or claim. The Clerk can approve claims up to $1,000.00 but only Supervisors can approve claims above that up to the amount of $100,000,000.00. As part of the threshold check, the system also checks if a budget posting, prep ayment, a deduction claim or an invoice claim can be approved automatically, depending o n the user's approval rights. This check is performed when the user saves a docume nt with status To Be Approved at header or item level. Prerequisite to activate this function is that the following indicators within t he transaction type customizing have been set in the step above: Approval Procedure for transaction types that have been assigned to the claims transaction category Claim. Multi-Stage Approval for transaction types that have been assigned to the transaction category Budget Posting.