FMCG firms step up sales staff incentives | Economic Times

Consumer goods companies have increased incentives of distributor salesmen by 50-70% since the outbreak of pandemic last year, in an effort to keep their sales operations running and ensure the frontline workers remain on field amid surging reverse migration.Until last year, the monthly incentives were Rs3,000-3,500 per month, which is now Rs 4,500-6,000 on an average, according to a report by Love In Store Technologies, which handles direct money transfer of more than a dozen FMCG firms including Britannia, Tata Consumer Products, Reckitt Benkiser, Dabur and Colgate Palmolive. "Incentivising sales people is crucial to keep them motivated as they remain on field despite surging infection risks," said Krishnarao Buddha, senior category head at India’s largest biscuit maker, Parle Products. "For them, it's also like a badge of recognition which works to push sales even further."Most companies expanded their distribution reach since last year and now have an even bigger store network than pre-pandemic. In fact, FMCG companies added about 10 distributors on average every day since January last year in an effort to reach consumers directly through their own dealers instead of using wholesalers, according to Bizom.Salesmen are not FMCG employees, but are appointed by distributors, and a typical mid-sized consumer goods company has 3,000-5,000 sales staff on the field."These distributor sales representatives visit stores to take orders, and hence are the true frontline in terms of FMCG sales. Many of them had left for their villages during the first wave and companies really needed them on the field to ensure business," said Aditya Goel, cofounder of Love In Store that manages direct account payments for salesmen and retailers on behalf of the FMCG firms.Companies said higher payout for sales staff was just one of the many stimulus they had initiated."In addition to securing our frontline sales staff with adequate insurance and mediclaim policy to cover for any medical emergencies, we have brought in appropriate changes to the compensation package with a combination of increased monetary and non-monetary incentives to keep them motivated," said Adarsh Sharma, executive director - sales at Dabur India.Amway said it also launched initiatives to upskill about 5.5 lakh distributors to ride the digital wave. “Consequently, we have observed approximately 20% increase in the income of our distributors vis-à-vis last year," said Anshu Budhraja, chief executive officer, Amway India.This heightened push on expanding reach resulted in the FMCG market growing 4.6% in the year ended March 2021, twice the rate in 2020 despite manufacturing and distribution hurdles in late March and April last year, as per Kantar.Marico, however, said it had tweaked the reward system even as its overall incentives remain unchanged."It has been done, firstly through simplification of key business metrics and aligned reward strategies which are driven by the frontend functions. The targets and metrics were recalibrated and shared on a monthly and quarterly basis to drive sharper focus on the most critical agenda basis the changing economic scenario," said Sanjay Mishra, chief operating officer, India sales at Marico.