The management team of a £5m turnover retail business wanted to increase their profitability to enable them to further invest in the business.
What we did
Introduced product cost cards for each product, gaining a detailed understanding of gross profit by product
Benchmarked the sales price of similar products at our competitors
Reviewed the value proposition of our products against the competitor products
Reviewed the promotions and reduced the discounts being offered
Increased the sales price of a number of product categories after modelling the likely volume impact
The outcome
In the first year, we increased profitability by over £200k or 4% of turnover after accounting for volume drop. This benefit re-occurred in future years. The management team were delighted and were able to invest the additional profits in growth.
The situation
The management team of a £5m turnover retail business wanted to increase their profitability to enable them to further invest in the business.
What we did
Introduced product cost cards for each product, gaining a detailed understanding of gross profit by product
Benchmarked the sales price of similar products at our competitors
Reviewed the value proposition of our products against the competitor products
Reviewed the promotions and reduced the discounts being offered
Increased the sales price of a number of product categories after modelling the likely volume impact
The outcome
In the first year, we increased profitability by over £200k or 4% of turnover after accounting for volume drop. This benefit re-occurred in future years. The management team were delighted and were able to invest the additional profits in growth.
