Using All the Profit Levers
•getting started •profit strategy •seven profit leversWednesday, July 15, 2015—Are you doing everything you can to improve your company's profitability?
Many companies don't realize that there are seven levers that affect profitability and sales performance. Consequently, most distributors only work on two of the levers, which means that they're losing out on a tremendous opportunity to improve their bottom line.
The seven levers are:
• Gross Margin Percentage
• Add-ons (Delivery charges, re-stocking fees, etc)
• The number of orders you have to handle
• The number of invoices you have to write
• The number of warehouse picks
• The number of deliveries
If all seven levers are engaged in your interactions with customers, you can achieve and maintain a significant advantage over competitors who only focus on controlling margin and volume. It can help to improve your profitable business even further while giving you some idea of what to look for in other customers.
Using these levers can also help to turn your money-losing accounts profitable. There's only so much you can do with the margin and some accounts may never have enough volume to overcome your transactional costs. These sales can be enhanced by add-ons and through combining orders.
While you can get a lot of mileage from using just a few of these levers, you need to work on all seven to truly maximize your company's profitability.
For more information about Randy MacLean, visit: www.waypointanalytics.net
Sophisticated New Delivery Costing Drives Higher Profits
See the surprising new methods top companies are using to calculate and optimize delivery costs and pricing, generating millions in new profits.
There's a direct link between high profits and second-tier customer service. This is how you use it to make more money.
Learn why distributors can't simply rely on gross margin when determining whether a sale will add to the bottom line.
Randy discusses the benefits of the extraordinarily valuable High Volume Account Report.
Dirk Beveridge interviews Randy MacLean of WayPoint Analytics on the analytics and metrics of super-profitable distributors.
Randy MacLean demonstrates how you can change the nature of your profit line by identifying highly leverage able profitable and unprofitable accounts.
A superior territory has a greater-than-average proportion of profitable accounts. This is the critical factor in territory management.
Most sales operations look for every possible sale, yet that's the road to mediocrity, or worse.
Randy MacLean discusses the secret to sustainable profitability and lays out a proven 6-step strategic road map that will help you take your competitors down.
Randy MacLean discusses a strategy to shift the profits in the market to your own company.
Most executives were taught that increasing gross margin would increase profit, yet that's almost never true. Here's why...