Marketing Metrics

Vinamilk Optimum Gold sales force

and channel management in Vietnam,
period of 2023 - 2025

GROUP 6
Overview of
Vinamilk's business activities

Vinamilk's main business activities include processing, manufacturing and trading fresh milk,
canned milk, powdered milk, nutritional powder, yogurt, condensed milk, soy milk, soft drinks
and products from other milk.
 Value chain of Vinamilk
RESEARCH AND DEVELOPMENT
UPSTREAM
Marketing and R&D teams have a deep
understanding of consumers and the
expertise to develop products that match
their needs.
DISTRIBUTION
An extensive distribution system and
DOWNSTREAM
network ensures products are effectively
distributed to consumers. Vinamilk strives
to boldly adopt new operation models that
meet the needs of domestic production
and export quickly, cost-effectively, and in
compliance with the law.
RAW MATERIAL AREA MANUFACTURE
Vinamilk works closely with their suppliers
Marketing and R&D teams have a
to ensure goods and services meet deep understanding of consumers
quality, environmental and social and the expertise to develop
requirements, in addition to the strict products that match their needs.
internal standards
MARKETING AND SALES
Vinamilk shows responsibility to
consumers and society by providing
better products in terms of quality and
more transparency in label information.
The brand also obtains feedback from
customers to create sustainable value for
both consumers and the Company.
Overview of
Vinamilk
Distribution
Channel
4Q2022 Vinamilk highlights
By distribution, the spotlight is the Traditional channel’s recovery following a long period
of sluggish growth. Meanwhile, the growth of the Modern channel has been stable after
a period of rapid development

Vinamilk actively implemented sustainable distribution solutions for the key traditional
channel in 2022. The spotlight of growth came from Vinamilk shops (sales growth of over
20% in 2022) and Key Account channel (over 10% YoY growth).
Vinamilk sustainable
distribution solutions
The notable growth came from Vinamilk shops (sales growth of over 20% in 2022)
thanks to nearly 40 new stores opening last year and Key Account channel (over 10%
YoY growth) backed by the rebound of the tourism and food service industries.

The e-commerce channel continued to record an impressive YoY growth of over 30%,
regardless of modest contribution to total revenue.
Sales force
and channel
management
calculations
Sales Force Coverage: Territories

Sales force territories are the customer groups or geographic districts for
which individual salespeople or sales teams hold responsibility.
Sales Force Coverage: Territories
A salesperson has 70 Current Accounts, Average Time to Service an Active Account is 15 minutes. Besides, she has 50
Prospects with a Time Spent Trying to Convert a Prospect into an Active Account of 20 minutes. Calculate her
Workload. Each customer has the buying power of 200.000 VND. So how much is the Sales Potential next month of this
salesperson? (Objectives: 5,000,000 VNĐ)

Workload = [70*0.25] + [50*0.33] = 34

Sales Potential = 34*200.000 = 6,800,0000 VNĐ
The sales potential of the salesperson was 1,800,000 VND higher than the objectives, which showed the sales potential
and helped the company to create balanced sales territories

Solution: The result was quite remarkable but Vinamilk still needs to update the marketing strategy since the
competiors' products can overcome the sales of Vinamilk anytime. They should focus on how to promote sales
and create new customers.
Sales goal
Sales goal
A salesperson has Salesperson's Prior-Year Sales of 80 million VND last year. Forecasted Sales reduced for District due
to Covid from 900 million last year to 700 million this year. Calculate this year's Sales Goal for this salesperson. Territory
share of sale potential in district is 15%. (Objectives: 150 million VNĐ)

Sales Goal = 80 + [200 * 15%] = 110 million VND

The sales goal of the salesperson this year was 40 million VND lower than the objectives. Covid-19 may be one of the
reasons which affected this figure

Solution: Monitor the sales activities by consistently measuring a few particular metrics or KPIs, which can help
the salesperson identify which practices contribute to reaching the sales goal and which areas may benefit
from improvement.

Review the weekly progress before setting new goals which allow the salesperson to make informed decisions
before setting goals for the upcoming week.
Numeric distribution

Numeric distribution is the percentage of outlets carrying a certain product

of company. The main use of numeric distribution is to understand how
many physical locations stock a product or brand.
Numeric distribution
Vinamilk has 134 stores in Hanoi, including 54 stores that sell Optimum Mama Gold
powdered milk.Calculate numeric distribution of Optimum Mama Gold powdered milk.
(Objectives: 80%)

Numeric Distribution = 54/134 = 40.3%

The number of shops selling Optimum Mama Gold powered milk in Hanoi was 40% lower
compared to the objectives, even though this was one of the best-selling product of
Vinamilk
Solution: Vinamilk needs to strengthen and improve its distribution system to be
able to bring Optimum Mama Gold products to wider coverage throughout the city,
thereby achieving the defined objectives.
All Commodity Volume

All commodity volume (ACV) is a weighted measure of product availability, or

distribution, based on total store sales. ACV can be expressed as a dollar
value or percentage
All Commodity Volume = Total
Sales of Store Carrying Brand
Vinamilk has stores with total sales of 1 billion VND, including stores that sell Optimum
Mama Gold powdered milk with total sales of 300 million VND. Calculate ACV of Optimum
Mama Gold powdered milk. (Objectives: 30%)

ACV = 0.3/1*100% = 30%

The figure showed the availability of the Optimum Mama Gold product based on total
sales. The ACV distribution already met the objectives goal, with 30%
Product Category Volume
Product Category Volume =
Total Category Sales of Store
Carrying Brand
Vinamilk has stores with total sales of 1 billion VND, including stores that sell Optimum Mama Gold powdered milk (vanilla
flavor only) with total sales of 100 million VND. Calculate PCV of Optimum Mama Gold powdered milk and Category
Performance Ratio. (with ACV of aboved exercise) Objectives: 20%

PCV = 0.1/1 = 0.1 (billion VND) Category

Performance Ratio = 10%/30% = 33,33%
The figure showed the relative performance of the stores selling Optimum Mama Gold powdered milk (vanilla flavor),
compared with performance in all product categories, and it was much higher than the objectives.
 Out-of-Stocks
The shop's warehouse list contains 2534 products, yesterday 370 products were sold out
of. Calculate Out-of-Stocks. (Objectives: 10%)

Out-of-Stocks = 370/2534 = 14,60%

The out-of-Stocks figure of Vinamilk was 4.6% higher than the objectives, which showed
that the shop was expected to have 100% available for the customers, but in fact, there
was almost 15% of them were already sold out

Solution: Vinamik can avoid stockouts by regularly monitoring and updating stock levels
PCV net Out-of-Stocks
The shop has PCV of 65%. Its warehouse list contains 2534 products, with 700 products
sold out of. Calculate PCV net Out-of-Stocks. (Objectives: 50%)

PCV net Out-of-Stocks = 65% * (1-700/2534) = 47.04%

PCV net Out-of-Stocks was a little lower than the objectives, which was 47.04% comparing
to 50%
Percentage On-time Delivery
A month, the store has 250 orders, of which 185 are delivered on time. Calculate
Percentage On-time Delivery. (Objectives: 80%)

Percentage On-time Delivery = 185/250 = 74%

Although Vinamilk had a quite high percentage of on-time delivery, it was still 6% lower
than the objectives

Solution: Discuss Strategy with Employees, Set Realistic On Time Delivery Goals,
Improve Inventory Management/ Focus on how to control the delivery systems,
retailers transportation since 90% of the products was sold by the retailers.
Inventory Turns
Vinamilk sells Optimum Mama Gold powdered milk for 100,000 VND. The company's sales
last year were 10 billion. The company's warehouse holds 1000 products. Calculate
Inventory Turns. (Objectives: 100)

Inventory Turns = [10M/(100,000*1000)] = 100

The company already met the same amount of Inventory Turns as their objectives.
Inventory Days
Vinamilk sells Optimum Mama Gold powdered milk for 100,000 VND. The company's sales
last year were 10 billion. The company's warehouse holds 1000 products. Calculate
Inventory Days (Objectives: 3.5 days)

Inventory Days = 365/100 = 3.65 days

The Inventory Days figure of Vinamilk was quite stable compared to that of the objectives
when it was just 0.15 higher.
Markdowns
Vinamilk originally sells Optimum Mama Gold for 120,000 VND. However, to celebrate the
company's anniversary, it decided to reduce the price of the product to 100,000 for the
purpose of liquidation and attract new customers. Calculate % of Markdowns.

Markdowns = (120,000-100,000)/120,000 = 16,67%

Gross Margin Return on
Inventory Investment
Vinamilk has a product called Optimum Mama Gold with Gross Margin on Product Sales in
Period is 25,000,000 VND. The average Inventory Value at Cost for each product is
5,000,000 VND. Calculate Gross Margin Return on Inventory Investment (Objectives:
500%)

Gross Margin Return on Inventory Investment = 25mil/5mil = 500%

The number showed the profitability of Optimum Mama Gold related to the inventory
investment required to make it available was 500%.
Direct Product Cost and Direct
Product Profitability

These are the costs of bringing a product to customers.

Direct product profitability represents a product’s adjusted gross margin,

less its direct product costs.
Direct Product Cost and Direct
Product Profitability
Vinamilk has a product called Optinum Mama Gold with a Gross Margin of 25,000 VND. In the production process of
Optimum Mama Gold, each product has the Warehouse Direct Cost is 7,000 VND; the Transportation Direct Cost is
2,000 VND and the Store Direct Cost is 3,000. Calculate the Direct Product Profitability (Objectives of Direct Product
Profitability = 18,000 VNĐ)

Direct Product Cost = 7,000 + 2,000 + 3,000 = 12,000 VNĐ

Direct Product Profitability = 25,000 - 12,000 = 13,000 VNĐ
The result showed that Vinamilk seems to have high product cost comparing to the profitability

Solution: Adjust the price to match the set target. However, Vinamilk needs to review
its goals and calculate so that it can still maintain a positive revenue while reducing
the selling price is still attractive to buyers. Vinamilk should narrow down the product
cost and optimize it in order to make the product profitability become higher
 Thank you!
GROUP 6