Operations

Minimum Order Size: Is It the Right Move for You?

How distributors can assess whether or not implementing a published Minimum Order Size (MOS) policy makes sense when considering both company and market dynamics.

September 24, 2020

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Courier picks up package on a warehouse.

The bittersweet sting of reality. Salesperson 1: “Score, just got 50% GP on that ticket!” Salesperson 2: “Nice work, that sounds like a real money-maker to me!” Reality: 50% GP on a bag of cable ties scheduled for next-day delivery, guaranteed before noon, likely doesn’t even cover the cost of the warehouse pick … not to mention the cost of all other SG&A expenses that a distributor naturally incurs. And to top it all off, no delivery fee was charged! Although the above is an extreme example, I have seen this firsthand and have also heard similar horror stories from many other industry…

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