Vietnam’s Leading Fresh Milk Producer Transforms Distribution Management System With Acumatica

TH True MILK

OVERVIEW

Founded in 2010, TH Milk is one of 3 companies under the TH Group, a founder of the clean and fresh milk industry in the fast-growing Vietnamese economy. TH Milk owns more than 30% domestic market share for fresh milk in Vietnam.

KEY RESULTS

·   Transform salesforce execution into world-class standard.

·   Streamlined communication across more than 180 distributors nationwide.

·   Increased control over sales force of more than 1,000 mobile salespersons.

·   Gained real-time visibility into market conditionsthat helps better real-time decision making for trade promotion

·   More accurate production planning and inventory optimization.

BUSINESS CHALLENGE

Founded in 2010, TH Milk is a leading producer of fresh milk and dairy products in Vietnam. It is one of 3 companies under the TH Group, an organization that has made large investments in infrastructure, human resources and scientific research to enable the production of clean and fresh dairy products in Vietnam. Its purpose: to support the physical and intellectual development of the Vietnamese people.

Since TH Milk began selling its flagship product TH true MILK (fresh milk) in Vietnam 4 years ago, it has expanded its product range to include yoghurt, ice cream and butter. In 2013, TH Milk was honored as one of Vietnam’s “Top 15 Best Enterprises” and recognised for being a founder of the clean and fresh milk industry in the fast-growing economy.

The company, which hires 2,000 employees, had revenues of VND4,000 billion (approx. USD188 million) in 2013. This is expected to grow to VND15,000 billion (approx. USD707 million) by 2015. Currently the supplier to 30% of the Vietnamese market, TH Milk aims to supply 50% by 2015. There are plans to increase the size of its herd by 4.5 times over the next 3 years, from 30,000 dairy cows currently to 137,000 in 2017, which will then account for 50% of the total milk-producing cows in Vietnam. TH Milk’s products are sold in more than 130,000 stores nationwide via 180 distributors, as well as directly through its own chain of retail outlets, TH True Mart.

To deliver leadership vision, TH Milk invested into not only scientific research and modern production facilities but also distribution system across nationwide. As a new established company, TH Milk employed current practices of distribution in GT channel: salesman come to each outlet to perform sales step and take paper-form-order, then submit manually into computer at the end of the day for consolidation. This tedious process frustrated TH Milk in term of market visibility and salesforce compliance: Which competitors’ brand was having a promotion? Who is buying display space? What are the new products on the market? How many salesman are really working and follow standard sales processes? How many salesman need support from above level to deliver his team’s target? This meant that TH Milk had no ground intelligence and was unable to respond nimbly to competition or enhance salesforce compliance.,

Another challenge for dairy firm like TH Milk is short expired date of product (normally is 6 month since production). In that, visibility into shelf life of product at outlet level is critical for TH Milk i.e. a promotion to push a certain product.

SOLUTION

With these considerations, and Vietnam’s strong nationwide 3G coverage to boot, TH Milk decided to update its outmoded distribution and sales process by tapping into cloud technology.

TH Milk had initially signed a contract with Indian company Zed-Sales to use its sales and distribution management software. “But they took more than a year and were still unable to customize their software for us,” said Mr. Hien Huynh Phu, TH Milk’s IT Manager. Zed-Sales was also decentralized; hence data would be stored at each distributor’s system before being sent to TH Milk. This posed concerns with security and data integrity.

In 2013, TH Milk decided to invest in a centralized Acumatica Cloud ERP platform that would allow it to track its sales force and obtain real-time information from the ground. The data would also enable TH Milk to measure distributors’ sales performance and capacity.

WHY ACUMATICA?

TH Milk decided on Acumatica for these reasons:

·   Standardize sales operation, increase productivity across salesforce and back office.

·   A single database, hosted on TH Milk’s private cloud, could be established at its headquarters, giving real-time and integrated information to all TH Milk staff, distributors and salespersons

·   Acumatica’s open API allowed TH Milk to integrate the new system with its existing SAP system

·   A user-friendly, web-based, and customizable interface eased user adoption

·   The Acumatica license allowed an unlimited number of users, so the future growth of TH Milk’s distribution network would not be hampered by unforeseen per-user costs

Assisted by DMSsoft, an Acumatica Gold Partner, TH Milk deployed the enterprise edition of the Acumatica Financial and Distribution Management Suites onto its own private cloud. IT manager Mr. Hien found that there was no problem fully integrating Acumatica’s platform with its existing ERP software by SAP.

WEB-BASED, REAL-TIME VISIBILITY ENABLES NIMBLENESS

The Acumatica system went “live” in September 2013 with 11 distributors; by June 2014, all 180 distributors were onboard. The 1,000 salespersons were trained and equipped with mobile tablets so they could sell from anywhere. Loaded with DMSsoft’s AiM (All-in-Mobile) application and leveraging nationwide 3G coverage, mobile devices brought real-time sales force automation to the fingertips of TH Milk’s salespersons: digital MCP, suggested order, real-time target update…, fully integrated with Acumatica.

Now, every morning, salespersons synchronize their sales data with TH Milk’s server via the AiM app. This allows them to receive new pricing or sales promotion information without spending 30-60 min to update information as previously; they also obtain specific purchasing information for each outlet, enabling them to suggest the right products and quantity for each retailer. Once orders are confirmed, the salespersons log them on the AiM app that immediately relayed to TH Milk’s server. Instead of waiting till the end of the day for sales orders to be relayed, TH Milk is now able to track every single new order in real-time.

An added boon is the increased ground intelligence: when salespersons spot a competitor’s product on sale or on display, they alert TH Milk instantly with a touch of the button.

Now, with the web-based Acumatica platform, TH Milk is able to know how much product retailers are selling, and how much stock there is at outlets and distributors’ warehouses. This real-time visibility enables more accurate production planning, and helps optimize inventory costs across its warehouses nationwide.

GREATER CONTROL OVER MOBILE SALES FORCE

The salespersons also download their daily sales route plans via the AiM app. With Acumatica, TH Milk’s sales supervisors can monitor their salespeople’s activities online, see which outlets have been visited, and view the orders taken. This enables supervisors to identify which salesperson needs more help to achieve their KPIs (Key Performance Indicators).

“We have many reporting requirements,” said TH Milk IT Manager, Mr.Hien. “Now, we’re able to easily give Management the latest information as any timezone: daily, weekly, and monthly.” He found the web-based user interface easy to use and customizable: “Any user can modify the screen to his preference. We can also modify the terms to suit our specific needs, for example, at TH Milk we describe salespersons as “sales reps”, and so on.”

Most importantly, Mr. Hien highly values the excellent IT support DMSsoft provides, with its 24/7 call center and 3 offices in 3 key cities to cover across  Vietnam. “The distributors are able to call the DMSsoft hotline for troubleshooting,” said Mr. Hien, “and DMSsoft staff come on-site ifneeded”

LOOKING AHEAD

TH Milk has been so pleased with Acumatica’s cloud-based platform and its benefits that it is now working with DMSsoft to expand the system to monitor sales at its retail outlets, TH true marts. This will replace its current use of LS Retail’s Point of Sale software, which is built on Microsoft Dynamics. TH Milk is also exploring the use of Acumatica’s web-based CRM suite to manage their relationship with consumers.