Tactics to Align Order Value with Logistics Costs (How to Get Your Profits Back)

When average order logistics costs exceed order value (gross profit), it will drain away profits already made on other (profitable) orders. In most companies, this is happening thousands of times each day, and it’s the principal cause of the profit erosion that’s prevalent in most distributors. In this article, I’ll share the specific actions distributors are now using to restore their past profit rates. The real drivers of lost profits are rapidly escalating manpower costs (up 68% since 2006), and the end of historically-low interest rates. These market changes are structural and permanent…