Deduction Management Webinar Takeaways: How To Not Get Lost in the Details

As anyone with a brand selling retail knows, distributors’ services don't come for free, and managing the deductions that distributors make is crucial to a company's bottom line. Naturally Chicago on February 22 presented a webinar, titled “Increasing Profitability Through Deduction Management,” aimed to help emerging brands navigate this maze.

The webinar featured Kyle Barnholt, CEO of TrewUp, a company he co-founded last summer that has developed a proprietary deduction management and analytics platform. This platform uses cloud-based AI technology to simplify the grueling and time-consuming process of analyzing deductions.

Barnholt was then joined on the panel by Alex Corral, Principal at Accountrepreneur; Jodie Wing, Chief Retail Sales Officer at Cerebelly; and Catherine Youngblood, Director of Sales at Lundberg Family Farms.

Click the button below to access the full recording of the webinar, then scroll to read some of the key takeaways from the presentation.

 Kyle Barnholt

Prior to launching TrewUp I spent time at Manuka Honey, helping lead the business in North America. And prior to that, I spent 13 years at Hain Celestial, really involved in all aspects of distributor management, account management, trade spend and deduction management. So I know the pain all too well.

During those 20 years, I always struggled to get the information from the deduction documents and the details that I needed to run my business. We tried everything from brute forcing it to printing and doing calculations… So in 2021, we launched TrewUp and we're trying to solve this pain point.

Deductions are obviously made up of things that happen within the supply chain that are related to shorts and fines and fees and spoils. But it's also related to trade spend. Today those lines may blur a little bit. But the reality is, is it's all related back to how you receive those deductions and what they're for.

One Hot Tip to Improve Deduction Management

Alex Corral

The hot tip for me is being proactive, because it's very confusing and it's easy to sort of bury your head… So really just staying on top of it and not get not letting it become overwhelming with months of transactions that that you need to work on.

Jody Wing

My hot tip is you have to have a plan. Regardless of how big or small you are, you have to have a plan. That could be using some of the systems that are out there, trade planning systems, or we use Excel and it works. But we pay special attention to working trade versus non-working trade, we really look at what is hitting that consumer versus what are the flat fees, what are the shortages and the returns and how. And then importantly, how we measure against those so that we can adjust.

Catherine Youngblood

It's really pretty simple. One of the best ways to jump in and save money immediately is understanding what the parameters are for the deduction and what was planned, from a date, from a product, whether it was a promotion, or when things were supposed to run. That allows somebody very simply to look at a deduction and to realize whether it's legitimate or should be reviewed. I'll say that probably one of the easiest ways to go down an Excel spreadsheet is if you know what your date should have been, and anything a couple of days outside of that definitely should be submitted for review. Or if there are products that weren't included, or if the deduction amount, if the promotional amount was not correct.

Kyle Barnholt

One thing that came to mind, particularly for this audience, is some of the emerging brand programs that our distributor partners and retail partners offer. So if you're not familiar with them, check out the websites for KeHe and UNFI. Retailers have them as well. For KeHe it's KeHe Elevate, UNFI has the Next program. The great thing about these is they come alongside you. They offer guidance and support as you're trying to figure out the complexities of distributing to retail and the natural food space and the beauty space.

Last Word on Profitability

Catherine Youngblood

To improve profitability, be bold, you know your business better than anybody else is going to, what the drivers are. Whether it be what's the right type of promotion, high/low, what's the right type of investment, and the more engaged you are in understanding your business and the ultimate drivers. I'll say I've been very fortunate I work with a team of experts at Omnium that have really helped build out our pretty clear understanding of elasticity, of the effectiveness of promotions, on how to segment the business and the key drivers, and where we need to be focused on investment. But when I take that to a distributor or to a retailer, and I'm engaged and I'm confident in understanding the best way to spend money to drive growth, then I've been able to eliminate some of the extraneous conversations and really drive better results with less investment.