Valuestream

This article highlights an important and increasingly common initiative among manufacturers and distributors. SKU rationalisation plays a key role in streamlining product portfolios, but to maximise its effectiveness, two additional elements should be considered: (1) Net Margin over Gross Margin: Relying on Gross Margin to identify underperforming products can be misleading. A more accurate measure is Net Margin, which accounts for SG&A expenses. Activities and associated costs should be meticulously allocated to the appropriate customer, product, or even order level for a better representation of individual product performance. (2) Continuous Improvement: SKU rationalisation shouldn’t be a one-off effort that leaves room for product portfolio bloat in the future. Instead, it should be an ongoing process, with regular reviews to identify and remove underperforming SKUs. Read the full article here: https://lnkd.in/g9_uhGiN

Concentrate on what you can control. When dealing with margin pressure, you have greater influence over managing the cost of the products you manufacture than on the price the market is willing to pay.

Australia's food manufacturing industry is facing significant challenges as rising imports threaten its competitiveness. With the increasing costs of production, many local manufacturers are considering moving operations offshore, which could lead to a decline in domestic manufacturing jobs and economic activity. Cost insight and optimisation have never been more critical, as local manufacturers strive to find efficiencies and stay competitive. Read the full article: https://lnkd.in/gnPQjrpf

For manufacturers tackling rising costs and eroding margins, this podcast offers a valuable 30-minute investment of your time. #manufacturing #productcosting #costmanagement

Last chance to register for tomorrow's webinar! Join us as Ian Robertson discusses the value and realities of implementing a sustainable cost-to-serve program to identify profitable and unprofitable customers and products. Register now: https://lnkd.in/gcuQnP4Q

This graph underscores the critical importance of accurately understanding individual customer profitability and the impact on cumulative profitability. This concept can also be applied to your products, with the intersection of customer and product profitability providing the most valuable insights. Join us later this month for a webinar focused on thought leadership in the Cost-to-Serve space, highlighting the value and essential building blocks for a successful customer and product profitability program. For further details and to register, click here: https://lnkd.in/gcuQnP4Q #costtoserve #supplychain #profitability

This graph underscores the critical importance of accurately understanding individual customer profitability and the impact on cumulative profitability. This concept can also be applied to your products, with the intersection of customer and product profitability providing the most valuable insights. Join us later this month for a webinar focused on thought leadership in the Cost-to-Serve space, highlighting the value and essential building blocks for a successful customer and product profitability program. For further details and to register, click here: https://lnkd.in/gcuQnP4Q #costtoserve #supplychain #profitability

This serves as an excellent lesson in making sure a great idea can be practically implemented. This wasn't always the case with activity-based costing, but it certainly is now. In today's business environment, marked by extreme cost and margin pressures, activity-based costing as an enabler for cost-to-serve is more valuable than ever. #costtoserve #activitybasedcosting #abc #profitability

Webinar: The Realities and Rewards of an Effective Cost-to-Serve Strategy Join us for an insightful webinar on Thursday, 20 June at 11am (AEST) where Ian Robertson will share practical knowledge on the intricacies of establishing a systematic cost-to-serve program, and how it can significantly enhance profitability when implemented effectively. In this webinar, we'll cover: 🔸Understanding the significance of supply chain cost transparency: Discover why cost transparency is crucial and how it impacts your overall business performance. 🔸The building blocks for establishing consistent methods of measuring and tracking customer and product profitability: Learn about the essential components needed to build and maintain a reliable cost-to-serve program. 🔸Identifying margin leak and leveraging value opportunities: Gain insights into recognising and addressing areas where profitability is being compromised and explore strategies to unlock hidden value opportunities. Don't miss this opportunity to learn how to apply cost-to-serve practices in a sustainable, repeatable way. Click here to register: https://lnkd.in/gcuQnP4Q #Webinar #CostToServe #SupplyChain #Profitability #BusinessStrategy

Webinar: The Realities and Rewards of an Effective Cost-to-Serve Strategy Join us for an insightful webinar on Thursday, 20 June at 11am (AEST) where Ian Robertson will share practical knowledge on the intricacies of establishing a systematic cost-to-serve program, and how it can significantly enhance profitability when implemented effectively. In this webinar, we'll cover: 🔸Understanding the significance of supply chain cost transparency: Discover why cost transparency is crucial and how it impacts your overall business performance. 🔸The building blocks for establishing consistent methods of measuring and tracking customer and product profitability: Learn about the essential components needed to build and maintain a reliable cost-to-serve program. 🔸Identifying margin leak and leveraging value opportunities: Gain insights into recognising and addressing areas where profitability is being compromised and explore strategies to unlock hidden value opportunities. Don't miss this opportunity to learn how to apply cost-to-serve practices in a sustainable, repeatable way. Click here to register: https://lnkd.in/gcuQnP4Q #Webinar #CostToServe #SupplyChain #Profitability