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How much margin do we actually make on our largest and most important customers?

From: Friday 27 June 2014

In every industry we have to do with it. The largest and most important customers of the products you are selling as an organization. This group of customers, we must cherish, because they deliver according to the 80/20 rule the most revenue and volume for the company.
But where we live by? The turnover, or the net margin that is left at the end of the ride?

Do we ever ask ourselves, ‘Do we make money on this large and important customer’?

These large and very important clients, often generate a lot of orders per day and send them by in PDF, Excel or any other manually format. Every day again, for them it is just pressing the button and the PDF rolls out their ERP system and the customer will send it directly by email for processing.

Some years ago there were massively web-shops brought in the air, to make sure that customers process their orders in it. Under the heading, that it would be easier for everyone.

The sounds that quickly came, were about that the web shop was made for the smaller customers, because they deliver too little, they are supposed to order via the web shops. While the larger customers continued with sending their orders manually.

This large flow of orders every day ensures a lot of manual processing within the organization. As a result; great pressure on the order management department which brings other problems with it. Such as large error sensitivity during the processing of the orders with all the possible consequences; Credit invoices, returns of incorrect delivered products but also disputes on invoices.

And to make matters worse, the conditions (in terms of contribution to the transport costs, price fixing and bonus payments) for this group of customers are getting sharper put down by sales every year.

If we now take a good look at these customers and all the costs, we quickly discover that something in the process needs to change.

Wouldn't it be nice if we can eliminate the manual work for these large and important (but ‘loss giving’) customers and process their orders electronically? Allowing us to start making money on these customers...?

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