The Ultimate Guide to Trade Spend Visibility: Why It Matters More Than Ever
Let’s start with the basics: What is trade spend visibility—and why does it matter so much? For many CPG brands, this term can feel abstract. But the truth is, trade spend visibility is the foundation for sustainable growth. Without it, brands are essentially flying blind, making critical decisions based on gut feel rather than real data.
When Good Planning Still Goes Wrong
Consider the story of a mid-sized CPG company that believed they had a solid strategy. Each quarter, they meticulously crafted promotional plans and aimed for a trade spend budget of 20%. They used a sophisticated system to prioritize their accounts—A, B, and C tiers based on performance and willingness to partner on merchandising efforts. On paper, their trade plan looked like a textbook example of good management.
But reality painted a different picture.
Despite their detailed planning, they consistently ended the year with a 30% trade spend—overshooting their budget by over $1 million. The biggest issue? A lack of visibility. They knew they were overspending with Distributors A and B, but had no clue why.
Frustrated and determined to get to the bottom of it, the team rolled up their sleeves and dug into the data manually. They built reports by indirect retailer and examined their non-working trade and supply chain costs line by line.
Two major issues emerged:
Overspending was concentrated at their two largest accounts.
A significant portion of the overages came from fines and fees that were previously buried in deduction paperwork.
The Wake-Up Call
This story is all too familiar in the world of CPG. Brands often operate without a clear line of sight into where their trade dollars are actually going. They may be running promotions, taking deductions, and accruing for future spend, but without granular visibility (e.g., knowing how much you spent on TPRs at Sprouts vs fines from KeHE), they’re relying on instinct rather than information.
And when teams can’t connect the dots between planning and execution, even the best strategies fall short.
Why Trade Spend Visibility Isn’t Optional
This brand’s turning point came when they finally got clarity—manual though it was. Once they could pinpoint the root causes, they adjusted their processes, addressed inefficiencies, and gained the ability to redirect funds more strategically. Fines were reduced. Promotions became more profitable. And leadership had the confidence that dollars were being spent with purpose.
The takeaway is simple but powerful: If you don’t know where your trade dollars are going at the retailer level, you can’t optimize them. Trade spend visibility isn’t a luxury; it’s a non-negotiable part of doing business in today’s market.
Trade spend is often the second-largest line item on a CPG brand’s P&L, yet too many companies lack the tools to monitor it effectively. The cost of that opacity is high—missed opportunities, wasted dollars, and stalled growth. But with the right approach and systems in place, visibility can become your competitive advantage.
If your team is feeling the pressure of trade overspend and deduction chaos, now’s the time to shine a light on what’s really going on. The insights are there—you just need the visibility to act on them.
Frequently Asked Questions About Trade Spend Visibility
What is trade spend visibility?
Trade spend visibility is the ability to see, track, and understand where your promotional and trade marketing dollars are going—down to the distributor and retailer level. It includes visibility into deductions, promotional spend, fines, and fees that impact your true trade ROI.
Why is trade spend visibility important for CPG brands?
Without it, brands risk overspending, missing accruals, and running unprofitable promotions. Trade spend is typically the second-largest expense after COGS, so gaining visibility helps improve planning accuracy, reduce waste, and increase profitability.
What causes trade spend overspend?
Overspending can be caused by:
Poor visibility into deduction data
Unexpected fines or fees from distributors
Promotions running without clear ROI tracking
Misalignment between planned vs. actual spend
How can I improve trade spend visibility?
You can improve visibility by:
Centralizing and analyzing deduction data
Breaking down spend by retailer, distributor, and promotion
Using tools (like TrewUp 😉) that automate the transformation of raw data into actionable insights
What’s the difference between trade spend and deductions?
Trade spend refers to all the dollars used to promote products at retail—TPRs, ads, displays, etc. Deductions are how distributors take those dollars back (plus fines and fees), often buried in cryptic remittance documents. Visibility means connecting the two.
Get Your TRADE SPEND MAXIMIZER FRAMEWORK WORKSHEET
Enter your email to access your FREE template for structuring your sales data report and start using the Trade Spend Maximizer Framework today!
