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Gross Margin Management

Sales-In-Sales-Out (SISO) Inventory Reconciliation

 Get the real channel inventory picture

One of the most important requirements for channel inventory control and optimization is the ability to know precisely the quantity of product in your channel. Simple inventory reporting by the channel partners is a necessary start, but not enough. After inventory data are gathered, cleansed and normalized, it is important to test the validity of the reported inventory numbers with independent calculations. Two independent calculations are required: Transaction Valuation and SISO Inventory Reconciliation. Sales-In-Sales-Out (SISO) inventory reconciliation is a critical step to validate the correct beginning and ending inventory levels in the channel. 

 

Simple inventory reporting is a necessary start, but not enough. If a channel partner claims to have sold 750 units in a given period, how do you know this partner even had 750 units to sell? Or if the partner reports 400 units of a given product in inventory, how do you know it is not 40 or 4,000? You don't.

 

Three major steps and capabilities are required to get a fully accurate channel inventory picture:

  1. Perpetual (roll-forward) Inventory
  2. Valuation and Currency Conversion
  3. SISO Inventory Reconciliation

These steps are described more fully below.

OPTIMIZE CHANNEL INVENTORY

  • Inventory validated with independent calculations
  • Adjustments as necessary with audit trail
  • Perpetual (roll forward) inventory maintained
  • Variance thresholds
  • Valuation and currency conversions
  • Proactive exception handling via Channel Analysts

Full visibility with Entomo's SISO inventory reconciliation

There are three major parts to the SISO Inventory Reconciliation module which provide unparalleled performance and accuracy. All of these functions are fully automated and supported by Entomo's Customer Success teams to further enhance the time to resolution of exception handling and enhance channel reporting compliance.

  1. Perpetual (roll-forward) inventory
    SmartHub maintains a perpetual-inventory view of all historical inventory levels—by partner and by part—and automatically rolls forward one period’s ending inventory to be the beginning inventory for the next. This analysis can be run on the fly for any arbitrary date—for example, to recalculate ending inventory for price protection or stock rotation payments.
  2. Valuation and Currency Conversion
    SmartHub can value inventory in a variety of different ways, including FIFO, price book or reported cost. If using reported cost, Entomo supports currency conversion for all transaction types from any reported currency to any base currency. Conversion rates can be real-time or synchronized with the company’s ERP system.
  3. Sales In Sales Out (SISO) Inventory Reconciliation
  • Inventory/POS reconciliation
    Automated reconciliation, by part and by partner, and analysis of reported channel data including returns, inventory, in-transit and uncredited RMAs (Return Merchandise Authorization). 
  • Automated adjustments
    • Automated adjustment for misaligned data, including reporting dates and financial periods.
    • Unresolved variances can be adjusted by authorized by individuals or via Entomo's Customer Success teams.
    • Overrides can be annotated with comments, and an audit trail is maintained.

Stagnating-Inventory

SISO Inventory Reconciliation Summary within the Entomo SmartHub.

 

SISO via serial-number validation and matching

Tech industries including computers, peripherals, networking, and software rely on the ability to match sales in and sales out using serial numbers. Entomo supports SISO serial number validation. This is undoubtedly the most accurate way to validate and reconcile and partner-supplied data.

Support to ensure your success

Entomo's Customer Success teams help ensure that overall partner management is formalized and optimized in a manner that establishes clear lines of communication and responsibilities. Our support services also help provide an objective basis for measuring partner performance, all without adding an additional burden on scarce internal resources.

The end result is an inventory data set that can be counted on by all departments. This ultimately enables confident decisions with regards to stock levels, incentive program planning and the avoidance of revenue leaks due to excess inventory, inventory outages, and incorrect sell-through information resulting in commissioning and incentive payment errors.

 

Revenue Management Data Sheet  Learn about our solutions for inventory reconciliation, incentive management  and financial activities Download Now
Partner Scorecard Webinar  Driving improved performance and collaboration with metrics and scorecards Watch Now
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