The 2020 Mid-Year Economic Update_long

January 10 2012

Profit Drivers Critical to Growth

Volume:

42

Issue:

1

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Features

The following analysis by long-time industry expert Al Bates examines key profit drivers in wholesale distribution across 40 lines of trade monitored by the Profit Planning Group. The pattern seen in 2010 is very close to what has been demonstrated in previous business cycles. This article benchmarks these key drivers and provides insight into the impact changes in each of these areas may have on distributors’ bottom lines.

Al Bates is author of Triple Your Profit! Stop Being a Profit Soldier and Start Being a Profit Winner, available now at www.mdm.com/tripleyourprofit.

To maximize your profitability, you must set priorities based on what drives dollars to the bottom line the quickest.

Key profit drivers most important to improving your financial results include:

Sales – Increasing sales volume without increasing fixed expenses.

Fixed Expenses – Reducing the level of fixed expenses without …

The winds finally shifted this holiday season. There were promising signs in the last quarter, but the most positive economic news in years came with the New Year. Domestic auto sales are stronger, the Purchasing Managers Index turned around, and there are signs of hope for construction markets that have been bumping along the bottom for years.

Anecdotally, many distributors ended 2011 with …

Time and cost frequently get in the way of a distributor’s pursuing a project to improve the quality of their product data. In this article, the author writes that there are more options now for improving product data that reduce both time and cost for companies of all sizes. This article examines the value of good product data and the role outside vendors can play in data cleansing and ongoing maintenance.

Good product data is crucial for any successful distributor catalog or e-commerce website. This includes accurate and complete specifications of products as well as clean photos, related items and substitute products.

Consider this: Distributors who say they have an effective catalog are nearly twice as likely to have complete data and more than four times as likely to have …

The first step to any technology-driven initiative these days is to update and clean up the data in your system. Business intelligence or strategic pricing initiatives in particular require a deep-clean to be effective. E-commerce is another area where good data – in this case product information – is essential.

Another element driving distributors to improve their data? The increased push for standardized formats and transmission channels across the wholesale distribution industry.

Quality of data throughout the channel is critical to …

There’s always room for improvement in inventory management no matter the size of the company. Jon Schreibfeder, president of Effective Inventory Management and author of Achieving Effective Inventory, shares the first steps a company should take to manage its inventory. Schreibfeder was featured in a recent MDM Webcast, Inventory Management Best Practices for 2012, available at www.mdm.com/inventory.

For wholesale distributors, managing inventory effectively is essential for profitability. After all, the heart of most distributors’ businesses is the warehouse.

But not all distributors know how to effectively manage their company’s inventory, says Jon Schreibfeder, president of Effective Inventory Management, Inc., and author of Achieving Effective Inventory.

In the recent MDM Webcast, Inventory Management Best Practices for 2012, Schreibfeder presented an approach to separating inventory as a way of determining its profitability. In order to gain effective management over a company’s inventory, business leaders need …

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The following analysis by long-time industry expert Al Bates examines key profit drivers in wholesale distribution across 40 lines of trade monitored by the Profit Planning Group. The pattern seen in 2010 is very close to what has been demonstrated in previous business cycles. This article benchmarks these key drivers and provides insight into the impact changes in each of these areas may have on distributors’ bottom lines.

Al Bates is author of Triple Your Profit! Stop Being a Profit Soldier and Start Being a Profit Winner, available now at www.mdm.com/tripleyourprofit.

To maximize your profitability, you must set priorities based on what drives dollars to the bottom line the quickest.

Key profit drivers most important to improving your financial results include:

Sales – Increasing sales volume without increasing fixed expenses.

Fixed Expenses – Reducing the level of fixed expenses without …

The winds finally shifted this holiday season. There were promising signs in the last quarter, but the most positive economic news in years came with the New Year. Domestic auto sales are stronger, the Purchasing Managers Index turned around, and there are signs of hope for construction markets that have been bumping along the bottom for years.

Anecdotally, many distributors ended 2011 with …

Time and cost frequently get in the way of a distributor’s pursuing a project to improve the quality of their product data. In this article, the author writes that there are more options now for improving product data that reduce both time and cost for companies of all sizes. This article examines the value of good product data and the role outside vendors can play in data cleansing and ongoing maintenance.

Good product data is crucial for any successful distributor catalog or e-commerce website. This includes accurate and complete specifications of products as well as clean photos, related items and substitute products.

Consider this: Distributors who say they have an effective catalog are nearly twice as likely to have complete data and more than four times as likely to have …

The first step to any technology-driven initiative these days is to update and clean up the data in your system. Business intelligence or strategic pricing initiatives in particular require a deep-clean to be effective. E-commerce is another area where good data – in this case product information – is essential.

Another element driving distributors to improve their data? The increased push for standardized formats and transmission channels across the wholesale distribution industry.

Quality of data throughout the channel is critical to …

There’s always room for improvement in inventory management no matter the size of the company. Jon Schreibfeder, president of Effective Inventory Management and author of Achieving Effective Inventory, shares the first steps a company should take to manage its inventory. Schreibfeder was featured in a recent MDM Webcast, Inventory Management Best Practices for 2012, available at www.mdm.com/inventory.

For wholesale distributors, managing inventory effectively is essential for profitability. After all, the heart of most distributors’ businesses is the warehouse.

But not all distributors know how to effectively manage their company’s inventory, says Jon Schreibfeder, president of Effective Inventory Management, Inc., and author of Achieving Effective Inventory.

In the recent MDM Webcast, Inventory Management Best Practices for 2012, Schreibfeder presented an approach to separating inventory as a way of determining its profitability. In order to gain effective management over a company’s inventory, business leaders need …