Customer, Product, and Channel Profitability Analysis

Finance Managers often struggle to gain a truly accurate understanding of organizational profitability, especially if their systems rely on cost models that utilize an apportionment methodology. In cases where an allocation approach is used, these models are often too simplistic and do not reflect the complexity that exists in most organizational cost structures. In both cases, managers require a more refined methodology to more accurately identify and measure costs and profitability. In addition, managers and other business users need the ability to trace assigned costs back to their origin and obtain rapid answers to their ad hoc queries.

This paper describes how the BusinessObjects leverages activity-based costing as the foundation for robust customer, product, and channel profitability analysis; how best to utilize various methodologies; and what represents best practice for calculating the cost of high-volume customer accounts, sales order lines, or SKUs.

2009, SAP Thought Leadership.

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