Outsource or Insource

Currently, almost 90% of CPG (consumer packaged goods) companies use a third party for support in some form and are generally satisfied. Outsourcing is especially popular during a recession, because third parties can provide merchandising services for cheaper prices due to economies of scale; the costs of labor and mileage are allocated over all the companies that the third party merchandiser services. You will be able to get broader coverage faster because of the increased flexibility of the reps. By outsourcing, you can hand off the responsibility of merchandising and focus on other aspects of your business, which may increase your growth and productivity. For managers who are not familiar with merchandising or do not have the time to hire, train, and oversee reps, outsourcing to third party merchandisers should be considered- they take responsibility of hiring, training, and managing the reps. A possible solution to the control issue is to increase the visibility of the third party merchandiser’s field reps. This can be achieved by using retail merchandising software, which allows you to see what the reps see, giving you real-time visibility into the field and what is happening with your products and your competition.