# Customer and service profitability **Key question:** Which customers and services make us money, and which ones lose it? Your accounts tell you whether the company makes money, not which customer generates it. Rates were set years ago and the operation has changed: more small orders, more rush jobs, more returns. Without a real cost per customer, every renewal is negotiated blind. ## What we analyze - Real operating cost per customer: warehouse hours, miles, waiting time, incidents and returns. - Revenue per customer and service versus that cost. - How each customer's order profile has changed. - Allocation of overheads using criteria your team understands and accepts. ## Decisions it supports - Revise rates with solid arguments at the next renewal. - Change service terms for unprofitable customers. - Decide where to grow and which services to stop offering. - Quote new customers using real costs. ## Common findings These are patterns we see often, not guaranteed results. What we find in your operation may be different. - A small share of customers generates almost all the margin. - High-volume customers can have negative margins because of their order profile. - Rates don't reflect extra services that are provided free of charge. - **Typical data:** ERP and cost accounting, WMS, TMS and billing - **KPIs:** Margin per customer, cost per order and per shipment, cost of incidents, revenue per service - **Related service:** Operations assessment