Question Is the budget management system for controlling budgets? The answer is not obvious; isn't a budget management system just for controlling budgets? Answer To answer this question, let's look at a case: A condiment company has an annual trade promotion expense of 50 million yuan. The company's trade channels are diverse and complex, including catering, retail, special channels, industrial, etc. At the end of the fiscal year, the financial officer reported that the budget utilization rate was 100%, with no overspending. It seems that the company's budget management is doing well. But upon closer inspection: ✔ 90% was invested only in the catering channel; ✔ 90% of the catering expenses were invested in paid display activity types; among them, several stores participated N times; ✔ More frighteningly, some stores had special price activities that far exceeded the minimum price limit. The specific numbers in the above case are fictional, but they reflect an unsettling fact: In many cases, the budget is controlled, but the results are not what we want. Therefore, budget management should not only focus on whether the budget is exceeded, but also focus on how to ensure that budget usage is more reasonable and effective. For example, what should we do about the issues mentioned above? First, Qingce establishes connections between different channels and dimensions such as organization and system for the above enterprise. This combination is called a BO (budget owner). Then we decompose the budget onto this budget organization and control it, as shown in the figure below. In this way, the budget allocation process is matched correctly, equivalent to giving each BO a separate budget pool, thereby avoiding the problem of severe budget tilt towards the catering channel. Secondly, during the budget usage process, Qingce helps the enterprise establish a series of rules to avoid problems such as [first-come-first-served], [duplicate promotions], [price undercutting], and [unreasonable cost-effectiveness ratios]. 01 By reasonably controlling activity quotas, effectively avoid the problem of maliciously seizing promotional resources. The so-called [first-come-first-served] means that activities do not limit the number of participating stores that can apply under specific conditions, resulting in whoever applies first potentially getting more promotional qualifications. Qingce helps enterprises establish an activity quota management mechanism, for example, a salesperson responsible for catering stores can only apply for 3 stores to participate in this activity; each store can apply for 3 tiers, each tier lasting 14 days, with an interval of no less than 7 days between tiers, etc. This ensures that promotional resources are reasonably distributed among stores, and also makes effective advance planning for specific store activities, thereby improving the scientific effectiveness of activities. 02 By constructing an activity mutual exclusion mechanism, effectively avoid the problem of duplicate promotions and fee exploitation. The so-called [duplicate promotions] generally have two situations. One is that a store repeatedly applies to participate in the same activity within the same period or different periods; the other is that a store repeatedly applies to participate in different activities within the same period or different periods. Qingce helps enterprises build an activity mutual exclusion mechanism, for example, a store is not allowed to participate multiple times within the same period or different periods; for another example, if a store participates in an end-cap display, it is not allowed to do a stack display or special price activities, etc. 03 By constructing a price undercutting monitoring mechanism, effectively avoid the problem of excessively low prices. If the price of a promotional activity is too low, it may lead to excessive losses. Therefore, the minimum selling price of the product can be pre-set. When a sales representative helps a store or customer apply for a special price promotion, the system will automatically prompt that a certain price in the application has fallen below the product's minimum selling price (price undercutting); Alternatively, parameter control can allow submission even if it is below the minimum selling price (price undercutting), leaving the decision to the approver, who decides based on market conditions. The system only needs to provide a reminder. 04 By constructing a standardized cost-effectiveness ratio comparison, effectively avoid the problem of unreasonable cost-effectiveness ratios. Generally, at the beginning of activity plan design, the designer has an expectation or standard cost-effectiveness ratio. Therefore, how to make each submitted application meet this cost-effectiveness ratio expectation or standard is the key factor in measuring the quality of the activity plan. Qingce can help enterprises set standard cost-effectiveness ratios and specific cost-effectiveness ratios for different plans, and then each submitted application can be compared with the above cost-effectiveness ratios. If it meets the requirements, it can be approved; otherwise, it is not approved. In this way, all customers participating in this activity set a flag at the beginning of the activity. After the activity ends, the actual cost-effectiveness ratio results can be compared with the previously applied ones, summarize problems, analyze gaps, and lay a data foundation for the scientific setting of the next activity plan. In summary, budget management is not only about managing the total budget amount, but more importantly, managing the budget usage process. By constructing various mechanisms, ensure that budget usage is reasonable and efficient. Scan the QR code to register and experience it immediately.