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Home / Industry / Retail /  Tech adoption to boost FMCG firms' efficiency, productivity

New Delhi: Large fast moving consumer goods companies that have stepped up technology adoption in their sales, warehouse and inventory management, and distributor systems will see improved efficiency and productivity in the long run, Edelweiss Securities said on Thursday.

Companies such as HUL, Asian Paints and Britannia are ahead of the curve when it comes to the technology initiatives they have taken up, said the report. Other listed players are also aggressively investing in tech upgrades.

Companies have been working on several digital initiatives including B-2-B ordering apps such as Hindustan Unilever Ltd’s Shikhar. Packaged foods company Britannia recently went live with a dealer management platform and vendor management platform. The company has also adopted a warehouse management system and this is likely to reduce warehouse, ordering and inventory expenses.

Upgrading technology for sales staff can complement the existing system, said the report.

“Highly contagious covid makes it risky for physical salesforce to go out in the field. Step in technology. It complements existing system, and unlikely to replace the salesforce. HUL’s Shikhar app allows a retailer running out of stock before a salesperson’s scheduled visit to place the order online directly…," analysts Abneesh Roy and Tushar Sundrani said in their report.

They added that technology can complement the salesforce, making it easier to serve retailers far more efficiently and accurately. “This improves overall sales. We believe replacement of the physical salesforce is far-fetched. Technology is a shot in the arm for the salesforce, improving their efficiency and productivity," they said.

In the long run, technology helps improve fill rates and the company’s ability to analyse and provide relevant data to sales team. This will reduce working capital needs and help manage inventory more effectively, the report said.

Companies have also developed ordering apps that allows retailers to place order directly with the company's sales team as opposed to relying on a distributor or a wholesaler. “An ordering app enables retailers to place contactless orders safely and also provides them visibility about the fulfilment of such orders through logistics tie- ups and intuitive interfaces. These apps complement existing systems; they do not replace the salesman," the report said.

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