Most distributors have naturally-occurring, High Gross Margin percentage (house) accounts and High Gross Margin percentage (small-dollar-pick) SKUs. These sales are surprisingly “Operating-Profit-Dollar” (Profit$s) losers.
The Gross Margin Dollars (GM$s) in these small-dollar picks and orders amount to less than the Cost-to-Serve Dollars (CTS$s) they consume, which means they cost your company more to fill than the Profit$s they generate for your company.
By contrast, direct-ship orders with low Gross Margin percentage are often quite profitable.
Continue reading 14. Gross-Margin Percent (GM%): A Poor Indicator of Profitability
Educational Journeys Should Never Cease!
In second grade, I was stunned to learn of the number of years of formal education still ahead of me. But, my PhD dad assured me that this big journey would be well-mapped and had been completed by many, non-exceptional adults.
He told me “Have courage, you can easily do it too!”
Besides, he was looking forward to helping me as needed, one fun grade-step at a time. Supportive, well-educated parents were, for me, a thankful given.
Continue reading 13. Questions to Ask Yourself Along Your Customer-Profitability Journey