R E P O R T
The 4 Pillars of Profit Improvement
In this timely report, Dr. Albert Bates delves into the remarkable surge in profitability levels within the distribution sector, where profit margins have soared from a historical 3.0% to an unprecedented 5.0% and beyond in the past two years.
This report promises to be a celebration of success while also addressing the looming challenge: sustaining these profit levels as the economic landscape shifts.
Dr. Bates dissects the critical role inflation has played in driving profits to new heights, a factor often viewed with disdain yet undeniable in its impact. Through a detailed examination, readers will gain insights into the mechanics of inflation-driven profitability and the lag in expense increases that has temporarily buoyed profits.
More importantly, this report pivots to the strategic actions necessary to maintain and potentially elevate profit margins in changing economic conditions. Dr. Bates introduces the "4 Pillars of Profit Improvement," a pragmatic framework designed for distributors to navigate the competitive tumult and secure enduring profitability. Each pillar – Sales Growth, Gross Margin, Payroll Expenses and Non-payroll Expenses – are explored in depth, offering to readers a comprehensive blueprint for profit planning.
Author:
Dr. Albert Bates
Distribution Performance Project
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About the author:
Dr. Albert Bates
Principal, Distribution Performance Project
Dr. Albert D. Bates is a principal in the Distribution Performance Project, a research group devoted to distribution issues. His website, distperf.com, contains numerous free Excel templates that can help distributors manage their business more profitably.
He is a frequent convention speaker and is one of the highest-rated speakers at the University of Innovative Distribution. His two latest books, “Breaking Down the Profit Barriers in Distribution” and “Profit Guide for the Small Distributor” are available on Amazon.