Avantgard Paynetexchange Case Study

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AVANTGARD PAYNETEXCHANGE CASE STUDY

The Pepsi Bottling Group

THE PEPSI BOTTLING GROUP LOWERED COSTS AND MAN-HOURS BY IMPLEMENTING AVANTGARD PAYNETEXCHANGE The Pepsi Bottling Group Inc. has been able to reduce its overall cost to produce checks and W9’s by about 25% with AvantGard PayNetExchange. Pepsi-Cola beverages per day. PBG’s focus is on superior sales execution, customer service, merchandising and operating excellence.

BACKGROUND
The Pepsi Bottling Group Inc. (PBG) is the world’s largest manufacturer, seller and distributor of Pepsi-Cola beverages - which includes some of the world’s most recognized consumer brands. PBG became a publiclytraded company in March 1999. PBG generates nearly $11 billion in annual sales. It operates in the United States, Canada, Greece, Mexico, Russia, Spain and Turkey, accounting for more than one-half of the Pepsi-Cola beverages sold in North America, and about 40 percent of the PepsiCola system volume worldwide. The PBG sales force of more than 30,000 customer representatives sells and delivers nearly 200 million eight-ounce servings of

PAYMENTS STRUCTURE
Up until 2004, PBG had printed all AP checks and W9 letters in-house. This internal function produced roughly 900,000 checks and 50,000 W9s in 2003. A dedicated production team of two and a half people worked to produce anywhere from 800 checks to over 20,000 checks in a single day. Providing this check printing service was no small feat. By using a laser check printing solution, the process was still very complex, and fraught with manual processes. Following are just a few of the challenges the former PBG internal printing operation faced: l

The process involved an array of forms, logos, check stock, and bank accounts Check applications included accounts payable, customer payments, payroll, reimbursements, and commission checks with each application having unique handling requirements

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THE PEPSI BOTTLING GROUP
Industry: Location: Revenue: Manufacturer United States, Canada, Greece, Mexico, Russia, Spain and Turkey $11 billion Environment: Centralized

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Special handling was needed to sort checks for distribution internally, at field locations, or by mail

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Expertise was required in print production, postal processing, forms design, check printing software, security procedures, MICR printers, and supply management

SOLUTION BENEfITS DERIVED:
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Overall cost to produce checks and W9’s lowered Less time needed to manage internal check handling processes Automated payments contribute to savings of 200 man-hours of labor

SOLUTION
In early 2003, PBG decided to consider alternatives to the internal production of checks and W9’s. PBG analyzed the potential advantages of using a third party for check

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printing and distribution. The business case demonstrated that a third party could get the job done faster and cheaper. One of the more significant factors in the business case focused on the postal savings to be gained through a third party with access to special postal sorting capabilities and volume discounts. With the case made, PBG generated an RFP (request for proposal) in the summer of 2003 and began evaluating potential vendors. A matrix was designed with a complete set of criteria and vendors were scored on each factor. The PBG team also made trips to numerous vendor production centers. After a thorough analysis of all contenders, PBG awarded the contract to SunGard.

“Given the special knowledge and skills required for our print operation, the right decision for us was to shift this work to a payments expert.” Susan Cotto, Senior Analyst
In choosing SunGard, PBG would get a partner with all the key attributes needed to meet their stringent requirements: l

Web-based application allowing PBG complete visibility over all aspects of payment production

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Tight security around all processes, data and facilities Complete print production facilities fully capable of meeting PBG...
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