Bruce Merrifield, President — Merrifield Consulting
•distribution management best practices •Distribution Personnel Training and Development •cost-to-serve math •cost-to-serve in distribution •line-item profit analytics in distribution
Wednesday, January 17, 2018—Randy MacLean, President of WayPoint Analytics, talks with Bruce Merrifield, President of Merrifield Consulting, about bottom-line math for determining business profit.
Merrifield Consulting has been giving companies great insights into their businesses and helping customers understand bottom-line math. This includes commonly cited figures such as 5% of the customers create 95% of the profit and that most accounts are profit losers.
Something new has to be done to take losing accounts to the next level. Executives typically don't know how to teach salespeople to look at accounts in a new light and are struggling with how to approach these accounts to change the nature of the game.
Why Distribution Companies Need Bottom-Line Math
Until now, activity numbers have trumped bottom-line math when it comes to business analytics and net profit calculation. With bottom-line math, companies can more easily recognize where the losers are and cease activities that were previously thought to be beneficial. With the new capabilities of analytics, companies can now hyper-focus on portions of the business that should have been considered all along: those that make the most money.
A new look at the customer base and reallocating resources, based on new data, can contribute to a big leap ahead of competitors. Once businesses take a look at new models, such as the cost-to-serve model, they can understand that activity does not always equal profit. In reality, some large-scale accounts, with large profits, actually have a higher cost-to-serve and lose money. This new data allows you to focus your sales team on changing the nature of the relationship.
Businesses must understand who their best customers truly are and bottom-line math can help them do it. More importantly, by understanding and rapidly adopting these new views of profit, they may just be able to get there before the competition.
For more information about Bruce Merrifield, visit: www.merrifieldact2.com
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The 3rd of 3 lists defining the markers of Distribution companies outpacing their peers.
Beyond Business Intelligence
Randy MacLean explains the differences in business intelligence systems, and how to know what you're getting with each kind.
A Culture of Innovation Starts at the Top
Steve Epner and Randy MacLean discuss topics from Steve's book. In this video: How to Innovate.
LIPA: Prophet of Customer Needs
See how implementing LIPA can give you the bandwidth to be more accommodating to your customers with analytics-based service excellence
Getting a Deeper Understanding of Costs
Randy MacLean and Bruce Merrifield of WayPoint Analytics discuss different levels of cost analysis, and why deeper analytics can bring much greater benefits.
How Distributors Should Rethink Their 2017 Sales Growth Plans
Waypoint Analytics uses line item profit analytics to dig deep into the numbers, and Waypoint users learn both bad news and good news about their customers.
9 Steps to More Profitable Relationships
Discussion about a 9-step process aimed at transforming a transactional relationship with an account into a partnership.
Gross Margin Percent: A Poor Indicator of Profitability
Many naturally occurring, high gross margin percentage accounts and high gross margin percentage SKUs are operating profit losers.
The Advantages of Segmentation
A discussion of the benefits of segmentation and how this approach can help distributors achieve far greater levels of profitability.
Protecting Your Core Business
How to identify and protect the accounts at the core of profits.
Increase Profits: Rank Customers and Act Accordingly
Here is a case study in which the lowest gross margin percentage niche was the most profitable and the highest gross margin percentage was the loser.
Discussing the Enterprise Account Selling Model (#3)
Continuance of the Enterprise Account Selling Model video series. Refers to a preceding video. Drawn from Bruce's presentation at APIC on March 1, 2016.
Discussing the Enterprise Account Selling Model (#2)
A continuation of the discussion between Bruce Merrifield and Randy MacLean over Bruce's Enterprise Account Selling Model (part 2).
Getting Your Salespeople to Negotiate Smarter
Using the negotiation process to achieve CTS savings, allowing you to offer your customers lower prices while leaving the table with a larger profit.
Increase Innovation with a Rule and a Tool
Bruce Merrifield discusses the Wheel of Learning and how this simple tool can catapult you forward with innovative thinking.
Cost-to-Serve Math: Why Gross Margin May Fool You Every Time
This video by Bruce Merrifield and Randy MacLean describes why you can't rely solely on gross margin to determine profitability.
The Changing Face of Sales
An in-depth look at some historical limitations to sales compensation, and why those factors no longer apply with the availability of LIPA.
Gross Margin Fixation
A fixation on gross margin – without looking at cost-to-serve (CTS) – has blinded countless distributors and limited their ability to achieve profitability.
Amazon Tactics: Know Your SKU Profit Winners and Losers
See why your most profitable 200+ items are typically popular commodities with lots of picks for lots of customers with a high average sales dollar per pick.
A WayPoint Client and Whale Curve Success Story
Learn how this distributor was able to massively ramp up its profitability even as it lost many of its customers.
Cost Structures: What Makes for a Good Sale?
Learn why distributors can't simply rely on gross margin when determining whether a sale will add to the bottom line.
Why You Should Sweat the Small Deliveries
A discussion on how little extras can sometimes add up to a lot of infrastructure cost in wholesale distribution companies.
Increase Innovation with a Rule and a Tool
Learn how to boost your company innovation IQ by adopting the Anti-Nitpick Rule and the Wheel of Learning Tool.
It's Not Who You Think It Is
Randy MacLean discusses key profitability metrics for QPM.
Why You Should Be Optimizing Inventory
Randy and Bruce explain why it's important to optimize inventory in the same way you optimize personnel and other resources toward the best profit opportunities
A Two Step Strategy for Being Number One in Distribution
In this video, Bruce Merrifield turns the tables on Waypoint President Randy MacLean, and asks Randy to strategize on how to beat the competition.
Prioritizing Your Customers
A discussion of the perils of a cookie cutter approach when it comes to sales and service in the wholesale distribution industry.
The Element of Pricing
It's not necessary to compete with AmazonSupply on pricing when you've got your ordering and delivery systems, fill rates and customer service at a high level.
Quantum Profit Management
Randy MacLean introduces the core principles of QPM and illustrates how it's the most effective way to run a business.
The Benefits of a Cost-to-Serve Math Program
Have you had trouble conveying the importance of CTS to your team? Learn how this course provides an affordable and convenient educational solution.
Why Come to APIC?
What is the value of the APIC conference for a business, and why does it stand out above other education programs?
Making Money by Giving Away Product
Bruce Merrifield and Randy MacLean discuss profit strategies for wholesale distributors that will raise their cost-to-serve and profits.
Webinar: How to Create a Sales Compensation Plan (pt 2)
Webinar: Quantum Sales Compensation Plan Part 2
Webinar: How to Create a Sales Compensation Plan (pt 3)
Webinar: Quantum Sales Compensation: Designing Your Plan
Webinar: How to Create a Sales Compensation Plan (pt 4)
Webinar: Quantum Sales Compensation for the Wholesale Distribution Industry: Launching Your Plan