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Industry:
Prodacapo product:
Solution in brief: |
Manufacturing
Prodacapo ABC/M
Customer and product profitability
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Increasing customer profitability throughout Europe
About
SCA is one of the world's leading paper companies. The Away from Home (AFH) division of SCA Hygiene Products is the European market leader in tissue products for corporate and public institutions. It has operations in 21 countries.
Challenge
Until 2002, the sales organization within AFH had little direction about which customers and sales channels they should focus on. That year, AFH initiate a new go-to-market strategy focused on maximizing profitability. But with their conventional financial system, AFH could only see gross profitability per client. To take the right actions to increase profitability, they needed to know net profitability per customer and product.
Solution
SCA has integrated the Prodacapo solution for Activity-Based Costing/ Management with their SAP Business Warehouse and information about costs and profitability is updated every quarter.
Results
The first analysis of the true costs for selling and delivering to clients showed that many customers were directly unprofitable. As a result, SCA decided to cease direct sales to some customers and serve them via distributors instead. This became a win-win situation for SCA, their distributors and their clients.
The cost and profitability information is now used by the sales organization. They know which customers are profitable or not, which customers to focus on, and what actions to take to increase profitability.
Learn about the Prodacapo software for Activity Based Costing/ Managment »
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