Measuring Customer Profitability

SalesTalk’s Metrics4ABM™ includes a truly unique and innovative Activity-Based Costing tool that “allows companies to develop a consistent, fact-based, comprehensive picture of their portfolio of customers. It helps them see which customers make the most significant financial contribution, and which relationships may need to be adjusted or eliminated” 

Choosing the Right Drivers

"Too often, costs are assigned to customers using easily obtained metrics such as sales volume or sales dollars. These metrics may not be the best ones to use as they assign costs based on things you generally want to increase. Instead, costs should be assigned based on direct activities such as labor hours per customer”.


- From Steve Lynch’s article “How to Measure Customer Profitability and Why It’s Important”. Steve is a Director in AC Lordi’s Business Advisory practice. He is a finance and operations management professional with more than 30 years of experience in manufacturing and professional services industries.

Track the Value of your Sales by Calculating the Actual Costs of the Sales Efforts

 

“In all my years of selling I have seen many sales plans calculate the activities to needed to achieve goals. But what I have never seen, is the taking into account the time aspect of those activities. That is, how long will it take to perform those activities. And yet, without this time aspect we can never fully optimize our time as sales professionals. Including the time dimension in your activities will give you clarity in a way that you may have never experienced. And that clarity will give you a very revealing perspective (as it did for me above) on what it actually takes to succeed.”


- James Muir of Best Practice International – author of “The Perfect Close” rated one of the top sales books of 2016 by Top Sales World.  

Track the Value of your Sales by Calculating the Actual Costs of the Sales Efforts

  

SalesTalk’s suite of AI based reports include two that are use the automatically captured actual time for all sales activities to calculate the actual profit from all your selling efforts.


  1. Actual ROI On Selling Efforts while the sale is in progress. Reports show projected ROI based upon the Forecasted Revenue or projected net revenue.
  2. Actual Net Profit Per Sale while the sale is in progress with reports that show projected new profit based upon projected gross margin.