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Value of Sales and Marketing Outsourcing
in Consumer Packaged Goods Industry

A study conducted by the Institute for Customer Relationship Management (iCRM),
Duluth, Georgia and the Center for Business and Industrial Marketing (CBIM),
Georgia State University, Atlanta, Georgia.

Sponsored by: ASMC Foundation of Grocery Manufacturers of America
Visit GMA's website at http://www.gmabrands.com/

Exerpt from GMA's Executive Update, dated September 24, 2004.

Council Announces Outsourcing Research Project

GMA's Sales Agency Council announced an agreement with the Atlanta-based Institute for Customer Relationship Management (iCRM) to conduct a comprehensive study of outsourcing sales activities. The project, unveiled during GMA's MSM Conference, will do an analysis of the value that outside sales and marketing agency functions can bring to manufacturers and retailers. This international research project will include in-depth interviews with 20 companies and surveys of at least 100 manufacturers, sales agencies and retailers from several channels. The iCRM team includes professors from the University of Colorado-Colorado Springs, Emory University, California Polytechnic Institute and the Center for Business and Industrial Marketing at Georgia State University.

The purpose of this study is to determine the nature and extent of value created for CPG manufacturers and retailers by outsourcing sales, merchandising and select marketing functions to specialized sales agencies. The study's results discuss how mutual value is produced and enhanced by outsourcing strategic and tactical marketing tasks. Manufacturers and retailers also learn how their marketing can be made more efficient and effective if they focus on their core competencies relating to manufacturing, distribution, procurement and branding, while allowing specialized agencies handle sales and marketing services. The study further examines the comparative value of specialized tools, technologies, processes, people skills and economies of scale in sales agencies that produce this outsourced value for manufacturers and retailers.