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Product and Customer Profitability

By providing a close up view of all of the component elements of your profitability and identifying your core, most profitable products and customers, SBM: Profitability Analysis enables you to focus on the top performing areas of your business and proactively steer your company by margin.

The profit calculation in SBM: Profitability Analysis is designed to make the best use of the data you have available, so in order to calculate profitability in a way that is right for your business it provides a set of analytics that let you decide how to calculate your product and customer profitability:-

  • gross contribution,

  • Profit Per Minute,
  • Return On Assets
  • as well as the classical gross to net margin analysis

can all be used to show how each customer, product and resource is generating revenue and profit for your business.

Product costing, actual costing and resource planning provide fast and accurate calculations of standard, actual and forecast profitability as part of their standard output and, because SBM: Profitability Analysis understands your product structures, you can see clearly where profit is being eroded by non value added elements as each product goes through the manufacturing, sale and distribution process.

By decoupling resource and activity consumption from the price and costing process SBM: Profitability Analysis makes it easy to accurately forecast future profitability. Using its 'What If' scenario planning components you can simulate the profit and revenue impact of changes to sales prices and the product mix, use different price tables to examine the impact of changes to the cost of materials, energy and labour and, using fast track substitutions, you can quickly model and understand the effects of changes to the way in which activities and resources are used and materials consumed.

 

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Last updated July 2006