SCM Sales Analysis – Profitability of Business

"Information about product level profitability inspired us to a whole new level of doing."

"We have integrated SCM Best Practice into our management system."

"We now know things we didn’t."


SCM - Sales Analysis focuses on analyzing business profitability after applicable costs. The application’s ”Customer profitability”, ”Product group profitability”, and ”Product profitability” views help bring sales management to the cutting edge of modern profitability analysis.

Typical results from using SCM Sales Analysis include improved supplier profitability, more efficient assortment management, a better understanding of the causalities of product level profitability and, of course, an improvement in customer profitability. Product and customer summaries are views into the sales history of a specific time period. Views are highly customizable based of different classification criteria. Classifications help break down data into different components, which helps in identifying problems, and facilitates taking corrective action.

Methodology for costs analysis based on activity-based costing - sales reporting based on ABC classification

ABC classification is done for each customer and product, based on their related sales in euros. Optionally, ABC classifications can also be done based on sales margin. Causal relationships can be analyzed by dynamically changeable line values, price categories, and event based value ratings. Additionally, classifications can be based on e.g. individual sales personnel, limiting values for free shipping, or on the terms of payment.

The end result is a product-by-product sorting of costs for acquisition, storage, and customer service, and how much profit is left over after expenses. This helps in making pricing-related decisions, and look for solutions for unprofitable areas, and especially, to eliminate work with low productivity. This gives us detailed information on increasing sales profitability, based on the classification used.

SCM Sales Analysis is for you when:

  • You generally want to improve business profitability - we’ll bring up areas of development
  • You want to improve customer profitability without raising prices
  • Your product selection management isn’t systematic, or is at least partly based on 'gut instinct'
  • There are undetermined factors of supplier profitability, which makes decision making difficult and error prone
  • Campaigns lack coordination with the purchasing department – the campaign is on and your supplies are out.
  • You find sales management challenging, but find it hard to come up with actable information to make changes.
  • The sales numbers increase, but the profits do not.
  • Annual discounts on sales freight costs distort performance reporting
  • You want to inspire your team to focus on things that matter
  • You feel uncertain about cost allocations in sales

Contact us! Even one of the above points makes contacting us worth your while.

SCM BEST OY
Viikinkaari 6

00790 Helsinki, Finland.
Info@scmbestpractice.com
+358 50 550 9829

 

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