Joint Business Planning is arguably one of the most important components of the annual planning process. Think about it. If major customers support your plans (and follow through), next year is going to be a lot easier. If JBP goes wrong though, next year is going to be tough. It doesn’t matter how good your brand plan, category plan or customer business plan are. If the retailers doesn’t engage, life will be a lot harder. So what can we do now, as the Joint Business Planning season looms on the horizon, to get more out of this critical process this year and get a flying start into next year?
Why does Joint Business Planning fail to deliver its potential?
Joint Business Planning. The high point (or low point, depending on your perspective) of a Key Account Manager’s year. In theory, it is the most powerful process we have in the annual planning calendar: the point where we get our major customer engaged in our plans and committed to work with us. Yet for many, it is a bit of a damp squib. In a recent survey we ran, over half of brand respondents acknowledged that the Joint Business Plan was more ‘business as usual’ than a step-change that moved the business forward. Most retailers suggest that JBP meetings are largely a waste of time, with one retailer telling us ‘it is very rare indeed for anything new to come from these conversations. It’s the same old stuff, brand activations and new products that we always get.
Is Joint Business Planning a waste of time and effort?
That’s pretty damning. And its also depressing. JBP preparation, meetings, and negotiations take a huge amount of effort. And not just for the sales team. Brand teams, shopper teams, category teams, and supply chain leaders can all get sucked into the JBP circus. A lot of investment. A lot of time. For no significant gains?
Yet Joint Business Planning was supposed to deliver so much more. The promise of true collaboration. The shared creation of plans that benefited both parties and were therefore much more likely to get implemented. Where did it all go wrong? Or (whispering) should we just forget about Joint business Planning and go back to making one-sided brand presentations?
Joint Business Plans – Where are we going wrong?
Firstly, lets be clear. JBP is a very powerful process when done correctly. The problem is that most companies don’t do that. So what do we need to do to ensure that this year as we look forward to 2025, we use this potentially brilliant opportunity to engage with our customers to step change our relationship, and step change our business? There are loads of things that can be done, but having worked with hundreds of companies and facilitated many Joint Business Planning strategy sessions with suppliers and retailers, here are my top ten mistakes and ways to improve.
Getting Joint Business Planning Right – Picking the right partner
Joint Business Planning takes a lot of effort. There are the meetings. The presentations. The negotiations. The data analysis. Maybe the data buying. The internal alignment. The inevitable negotiation. So before we start, let’s make sure that we are working with the right customers. Which customers are most valuable today? Which customers are likely to be more valuable tomorrow? we shouldn’t focus on the biggest customers necessarily, but those that represent the biggest untapped opportunity. Those are likely to give the best return on JBP investment.
But it isn’t just about opportunity. Its about whether or not the opportunity can be realised. Ask yourself: are they cooperative? Do they have a track record of delivering? Of sharing? In simple terms, are they into you? If not, is it realistic to expect that you are going to turn things around and become the equivalent of a happily married couple when were barely on speaking terms on the last date?
Choose the right Joint Business Planning Approach
Most suppliers seem to have a one-size fits all mentality when it comes to JBP. That is, they follow broadly the same approach for each customer. But that doesn’t make sense. We need to consider the likely returns as well as the capacity of both parties to invest and execute the JBP. In our workshops, we look at three different approaches to JBP – each requiring different levels of time and energy and each suitable for different types of customer. Applying a varying approach ensures that we focus our precious time and resources on the customers that are likely to give us the best returns.
Have a plan in advance of the customer meeting
Make sure you have a plan. Make sure you know what you want out of the JBP planning meetings. If you don’t know that, how do you know if it is worth the effort? How can you guide the process to achieve your objectives? Retailers want you to bring something to the table, so make sure you have an exciting, motivating, powerful plan that can really impact your business AND your customer’s business.
Don’t have too much of a plan
At the same time, this is a collaborative planning process. If you go into the meeting with a fully worked up plan with all the details, that really isn’t an invite to collaboration. From the retailer’s point of view, it looks and feels like a ‘take it or leave it’ proposition. Have a plan, present opportunities, and co-create from there.
Get aligned internally before you start
The plan you take to the customer should be a collaborative effort internally, well before we seek collaboration with the retailer. It should look to capture opportunities to grow our brand, the category, and specific customer opportunities too. All functions need to be aligned on this plan – there is nothing so unseemly as the brand manager arguing with the key account manager during the meeting. There is nothing so embarrassing as having conflicting data from different departments either.
Work out your priorities
The customer isn’t going to agree to everything. No matter how much your retailer loves you. NO matter how awesome your plan is. No matter how much customer value it creates. NO matter how cool your PowerPoint animations are. They just won’t. In part because we’ll ask for too much (they have other suppliers). Partly because some of it will be just too much hard work for the retailer. And partly because they want to negotiate. But they won’t say yes to it all. What are our priorities? What must we get agreement to? So be clear. And be aligned.
Look at the world from the customer’s point of view
Nobody likes surprises. Especially in the middle of one of the most important meetings of the year. In front of the customer. And your boss. And all your peers. Fortunately, retailers are mostly predictable. And if you know your customer well, you should be able to predict their responses.
Be ready for the unexpected
I’ve personally facilitated many many JBP strategy workshops between clients and retailers and I can honestly say, none of them have ever been the same. So be ready for the unexpected. And remember surprises are always bad news. I was facilitating a session recently with a retailer who had a reputation for not being cooperative. But halfway through the session the most senior director suddenly opened up and started sharing. The supplier team scrapped half of the agenda and went with the flow. They now are working on a completely new plan, together with the retailer. A plan that could easily double their business. You never know.
Agree KPIs and monitoring
A key part of any JBP process is the JBP Scorecard. It captures a set of measures that will be used to keep the plan on track and make sure it delivers value. You need one. But just as important, you need to agree how it will be tracked. And what will happen when we are ‘off target’.
Many of your might be cynical about JBP scorecards, saying that retailers ignore them when it suits them, and use it as a tool to beat up the supplier when they choose to. If that is happening, then either, you have the wrong partner (see first point), or you have the wrong measures on the scorecard. The scorecard must be balanced. It must contain KPIs that BOTH parties value. If it is all about stuff that benefits the retailer, then they will use it as a stick to beat you with. If it is all about things that benefit you, don’t be surprised if they lose interest fast.
You will have to negotiate
Its tempting to believe that, if we get it right, we’ll (metaphorically of course) be skipping off into the sunset holding hands with our partner and living happily ever after. Yeah. But no. There will be a negotiation. There will be money. Fees. The usual demands. Sorry to disappoint! But. Those negotiations will be easier, faster, and you’ll get better outcomes. Just don’t expect a miracle!
It’s a marathon, not a sprint
If you do Joint Business Planning well, it can step-change your business relationship and your business performance. But it isn’t a magic wand. Be realistic about what can be achieved this year. Be ambitious, sure, but recognize that success requires two complex organisations to change the way they work. That takes time.
Done right, Joint Business Planning with retailers can transform your business
Joint Business Planning with a retailer can be incredibly rewarding. Maximising your brand growth depends on engaging major customers effectively, after all. But it also takes time. Effort. Expertise. We support suppliers and retailers around the world with a series of training workshops, process guides, templates and more. We can help you assess your own business, and your customers, so that you invest in the right JBP approach with the right customers. We are experts at facilitating JBP sessions too. If you’d like to know more about how we can support you in growing your business through effective Joint Business Planning with retail customers, please get in touch now.
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