When the company sends more stock than you can sell

Month end. The company’s area manager has a target, and you are how he meets it. “Take 200 extra cases, the scheme is good this month.” You take them, the invoice arrives, and three months later a third of them are still in your godown, close to expiry, with your money inside them.

This happens because the company sees one number and you live on another.

Primary and secondary sales, in plain words

A primary sale is the company selling to you. A secondary sale is you selling to the shops. The company’s target is usually primary: goods out of its factory. Your cash depends on secondary: goods out of your godown. When the two drift apart, the gap sits in your godown.

What pushed stock really costs you

• Cash: you pay for goods that are not selling. See the company wants cash, the shops want credit.
• Expiry: the extra stock is the stock that expires. See damaged and expired stock.
• Margin: to clear it you end up offering discounts. See the discount sum.

Walk into the meeting with your own numbers

An area manager can argue with a feeling. It is much harder to argue with a list. Before the order meeting, write down for each product:

1. What you actually sold to shops each week for the last eight weeks.
2. What you have in stock today, and how many weeks that lasts. (Our guide on stock that is stuck shows the sum.)
3. For anything that expires: how much you can sell before the date.

“I sell 40 cases a week of this. I have 6 weeks of stock already. I can take 60 this month, not 200.”

That sentence, with the list behind it, is the whole negotiation.

If you do take extra

Sometimes taking a push is worth it: a good scheme, a launch, a relationship worth keeping. If so, ask for something in return, and get it in writing: support for a scheme to the shops, longer time to pay, or a clear rule on expiry and damage returns. Whether the company agrees is up to them; asking costs you nothing.

How Mulberry Sales helps

Every bill your salesmen make is a record of a real secondary sale, by shop and by product, made at the shop rather than typed in later. Reports show sales by product for any weeks you choose and export to Excel in one click, so the list you bring to the meeting is the one your bills made (Growth plan and up). Stock on hand is kept current as bills are made, and stock alerts list what has stopped selling (Business plan). See FMCG distribution software.