Considers all factors relevant to supporting specific products/services compared to the profits generated from each to determine your return on investment
Involves much more than traditional analysis that relies on gross sales or gross profits only.
Drills down to analyze transaction frequency and average value of same in terms of sales and gross profits, average value of inventory carried and total return on investment.
How It Benefits the Client:
Provides valuable information about the profitability of their products/services for management decision making.
Aids in decisions on pricing.
Assists management in determining how to allocate limited resources such as marketing dollars and sales efforts. Looks at their products/services from a strategic perspective, eliminating unprofitable products and services and focusing on the profitable ones will help increase their profits, cash flow and return on investment.
