Should I account for the redistribution allowance as a trade expense?

Too many manufacturers still account for the redistribution allowance as a trade expense, without regard to the corresponding savings in logistics and administrative costs.

Accounting for the redistribution allowance as a trade expense can make redistribution look like an incremental cost and drive bad logistics decisions based on individual budgets.

This practice fails to recognize the cost savings realized in the supply chain. Charging a proportional amount of the redistribution allowance to the supply chain group not only provides a more accurate reflection of the business, but also ensures that supply chain personnel are involved in program development as well as ongoing optimization of the redi program.

To learn more about the myth of accounting for the redistribution allowance as a trade expense, download your free eBook Top 10 Mistakes Food Manufacturers Make in Food Redistribution