www.randymaclean.com Randy MacLean

The Six Critical Reports Every Company Must Have

Randy MacLean

1. Whale Curves

Whale curves are cumulative profitability charts, and are the best visualization of the company's internal profits. With whale curve charts, you can quickly visualize how much internal profit is being generated, and how much of that profit is being lost on dysfunctional accounts. With this powerful tool, you can quickly assess the profit potential in any category, and identify profit drains that are preventing peak performance.

Whale curves can be generated for accounts, products, vendors or territories and are useful for subsets of any of those groupings.

Takeaway: Generate whale curves for every significant business segment, and work to reduce or eliminate profit drains that are destroying the segment's true potential.

2. Customer NBC Ranking

NBC or Net Before Compensation is the definitive metric for customer profitability. NBC shows the profit of a territory or customer after paying for the product and the infrastructure required to deliver the product into the customer's hands. The usual analytical distortions of sales compensation are eliminated, giving a clear picture of account or territory profitability.

NBC ranking reports are essential because they can keep focus on the greatest contributors and detractors of company profits. Every organization needs to protect, preserve and penetrate the accounts of the top of the list, and reform and improve those at the bottom.

Takeaway: Obtain or develop NBC ranking reports for accounts, territories, products and vendors. Use the NBC rankings to keep the company focused on those things with the greatest impact on the bottom line.

3. Territory Five-by-Five

The 5 x 5 reports help focus the right activities on the five critical accounts in the five most important groups in each territory. The five segments are: most profitable accounts; best opportunity accounts; most unprofitable accounts; fastest-growing accounts; and fastest declining accounts. Each of these groups needs to have its own set of strategies and tactics tailored to the nature of the group.

Companies need to have 5 x 5 reports for every rep or territory, and at the branch, district and region level. For best results, the reports need to be NBC, not gross-margin oriented. In this way, the entire sales organization can be focused on the groups of accounts most critical to success of their particular level in the organization.

Takeaway: Obtain or develop a system of 5 x 5 reports for every level of your sales organization, and make them the cornerstone of a company-wide sales management process. In addition, develop 5 x 5 reports narrowed to the product line or vendor.

4. Account Margin Target Reports

Since every account imposes its particular cost structure on the relationship, it's essential to recognize that each account will require its own unique margin target. One-size-fits-all margins are ineffective in achieving and maintaining profitability. With margin targets that properly take each customer's costs into account, the company is less likely to overprice low-cost accounts, losing potentially profitable business. High-cost accounts present opportunities to work with the customer to reduce costs on both sides of the deal, or ensure there's sufficient margin to cover them.

High-end strategic pricing programs take these same elements into account and have generated millions in profit gains. Consider taking this kind of reporting to a much higher level with Strategic Pricing.

Takeaway: Obtain or develop account margin target reports that use each account's cost structure and product mix. These reports can be a central tool for guiding the sales force to significant profit gains.

5. Comparative P&L

A comparative P&L report will segment your business along any dimension, and produce side-by-side detailed P&L reports for each segment. With this critical tool, companies can quickly evaluate profit potential within each segment, and identify those where cost structures are out of line. You can quickly understand the dynamics of the business at a much deeper level of detail, and can gain insights not generally known in the market. This can confer a huge advantage, focusing resources on critical areas that directly affect company performance.

The best of these systems can break out segments by: location; territory; rep; distribution type; warehouse; delivery type; product category; buyer; order method and much more.

Takeaway: Obtain or develop a system that can quickly and conveniently slice the business on every dimension, showing profitability all the way to the bottom line for every slice.

6. Profit Delta Reports

To drive and maintain profit gains, it's essential to know which accounts, territories and product categories are showing increases across time, and which are doing the opposite. For every one that's generating less profit than it was, new profits will have to be found just to stay even. When you can see where positive and negative change is occurring, you can take action to reduce or replace loses, and to protect and grow the gains.

Takeaway: Obtain or develop profit delta reports that show how NBC is changing at the account, territory and product level. Use these to actively manage profit growth at every level of the business.

Webinar: Increase Profit Through Margin Analysis


This webinar unveils the exceptional power of our Margin Analysis report. During this session, you will gain valuable strategies to immediately capitalize on lucrative opportunities and drive your company's success. The WayPoint Margin Analysis report provides a dynamic customer list segmented by profit value and efficiency. It presents their current margin, target break-even margin, margin required for contribution, and coverage of sales compensation. "Contributing" customers exceed the company average profit rates. Additionally, customers falling below the target margin display the precise price adjustment needed to reach the target. Unlock valuable insights for optimizing profitability and strategic decision-making.

Measuring & Managing Fleet Costs


Any organization that runs a fleet can benefit substantially from knowing transport costs at the customer/delivery level. This component of the customer cost envelope plays a big part in understanding customer value and drives decisions on pricing delivery, setting margins and routing decisions. To do this at the top level, companies are moving away from using mileage, and toward a much more accurate and effective time-based measurement. WayPoint can utilize the better inputs, calculating very precise costs at the customer level. A time-based system is also dynamic, reflecting cost changes driven by daily route changes, opening numerous new ways to optimize delivery costs. In this session, we'll show your team how this is done, and how you can find significant reductions in delivery expenditures while improving customer service. This is a session for operations people, CFOs and chief executives, so assemble your team and be ready to continue the conversation at the end of this 30-minute session.

The 7 Areas That Need Your Focus (brief)


The 3rd of 3 lists defining the markers of Distribution companies outpacing their peers. These are the specific areas that many companies commonly miss and places where your focus on new strategies and tactics will make a huge difference on your productivity and profitability.

The 6 Attributes of Super-Profit Companies


The 2nd of 3 lists defining the markers of Distribution companies outpacing their peers.

The 5 Things Customers Want (brief)


The 1st of 3 lists defining the markers of Distribution companies outpacing their peers.

Customer Segmentation


With the right segmentation you can define customer service levels, delivering high service levels to the accounts that need and can afford it. You can set price levels appropriate customers needing every level of support from "no frills" to "gold-plated". You can focus your sales efforts precisely — working to acquire new customers that perfectly fit your strategy and deliver increased profitability through optimally-efficient logistical relationships.

New Money – How to Analyze & Boost Profit from Delivery


Fleet and delivery operations are a frequently overlooked opportunity to add much more profit to your bottom line. In fact, every dollar you save or charge is just as beneficial as $25 in new sales. No wonder today's top companies are using surprising new methods to measure and optimize fleet costs, and implementing advanced analytics to set pricing and policies for deliveries.

New ideas and new tools are shaping customer choices, and increasing competitiveness. This video shares what we've learned from hundreds of the best companies across more than 15 years of strategic planning and on-the-ground tactics that have generated millions in new profits.

How Distributors Can Double Their Rebate Income


Rebates have grown tremendously as a percentage of the bottom line of distributors over the course of the last 3 years. In fact, in most instances, they now account for more than half of year-end profit.

In this session you'll gain insights on: How rebates are impacting your true line-item profitability / How to leverage your existing agreements / How real-world product mix add-up.

Novelties and New Core


We've added exciting new capabilities to the waypoint user interface. In this video we show you all the newly added features that will increase ease of use in the WayPoint program for a more convenient experience.

WayPoint Presentation


In this session, Randy MacLean walks you through the newest and most effective analytics for profit management. Using these metrics, companies produce record-breaking profit rates and growth. In just 17 minutes, he covers the hidden dynamics that are adversely influencing profit rates, suggests the not-so-obvious solutions executives are using to address them, and shows how WayPoint measures and reports on them. You'll see the only reports available that give company executives the ability measure, monitor and manage the real drivers of company profit.

How Money is Made in Wholesale Distribution


Randy MacLean shares his analysis of over $65B of distribution business to help others shed incorrect assumptions about how to make money. Businesses that have stellar results have been able to understand profit dynamics and move the profit needle not just by five or ten percent, but by doubling or tripling the bottom line over their competitors.

You've Lost Your Biggest Account – Now What?


Everyone eventually faces the loss of a significant account. Sometimes it's one that represents such a large share of business, that "normal" operations are no longer possible. How you handle the situation will determine whether it's an unpleasant blip, or a near death emergency. This video shows what to do to keep your ship from afloat when the inevitable happens.