10. And our existing distributors did not want to
invest heavily in our exclusive sales agents*
* And we need to return our investment in agents within 2 years
11. At that time there we the following
shared investments in salaries:
50% / 50% One pays the
whole
(distributor or supplier)
Fixed and variable
(producer pays fix, distributor –
variable part of salary, or vice
versa)
12. But no one model fit us
Because of time to market
Or by managability of agents
Or by return of investment within 2 years
13. And we started the negotiations
Having a lot of trips across Russia, I
developed the model, which suited both
Danone and Distributors
15. 3% of total
turnover
Agent Salary
Danone: How much do you pay to your agents?
Distributor: 3% of total turnover
16. Danone: How much do you pay to your agents?
Distributor: 3% of total turnover
Danone: so you can pay to our exclusive sales agent not
less than 3% of turnover of Danone
Turnover of Danone
Agent Salary
3% of Danone’s turnover pays Distributor
17. Distributor: Agreed.
But 3% should not cover all the salary!
Turnover of Danone
Agent Salary
?
3% of total turnover pays Distributor
18. Distributor: Agreed.
But 3% should not cover all the salary!
Danone: Danone pays the difference.
And we decide about fixed/variable,
You job is to pay your 3%
Turnover of Danone
Agent Salary
Danone pays
3% of total turnover pays Distributor
19. Within 2 years turnover of Danone grew and the 3%
covered the whole salary of agent, and we did not invest
any more but fully managed exclusive sales agents
3% cover
Agent Salary
Turnover of Danone
Agent Salary
Turnover of Danone doubles
Danone
3%
20. Distributor started to check validity
of our agents’s sales, as he payd
3% of their turnover.
It was double-check of secondary
sales
Pleasant discovery
21. So, we hired exclusive sales agents ….
But there came an obstacle …
22. It was not profitable for
distributor to deliver our orders to
shops — it was less than
minimum delivery lot
Unprofitable logistik
26. And we obliged agents to add “ballas to the order
заказу up to minimum lot. As a “ballast” we used
«Chaka» peanuts»*
* In every region «Chaka» peanuts» were different products
32. Adaptation, on-boarding, mentoring, work with,
recruitment
Annual Personal Development Review
Career ladder, strategik organizational
development plan
And we started to set up business
processes for our exclusive sales agents:
33. There is no difference is sales agent on
our payroll, or on distributors — when he
sales our products exclusivelly, he gets
all the benefits of Danone
General Manager, Danone-confectionary
Alexey Mekhanik
34. As example, our agents on
distributors payroll got their
fix and var salary on the 3-
rd day of the month
And it was not only words, it was
strong processes
35. As a result, in a two years
60.000
retail outlets
40%
Revenue growth*
400
exclusive sales agents
*with the same EBIT in %
