The main purpose of any company – floral or not – is to generate revenue, as simple as that! When it comes to reaching financial goals, the first thing everyone thinks about is Gross Profit Margin as it indicates the percentage of your revenue left over after the cost of goods sold. GPM is a key measure of the financial success of any organization.
So how do you make sure you reach these financial goals? In general, once your company establishes a target GPM, it doesn’t vary very much unless there is a change in the business model. When you have settled on a percentage, make it public, set it up in your business platform and enforce it! Now, you also want your team to have some flexibility as pricing may change greatly from one season to another. Here are a few ways in which you can stay in the know and also leave some room to play around with the pricing:
Automatically Calculate Pricing with GPM
Setting pricing manually for a customer can be cumbersome! Many users have markups or special price lists but even when that’s not the case, your sales staff doesn’t just remember to do the calculation for every single product line. There’s an option in Komet to configure your desired GPM so that your orders, presales and purchase orders have an automatic “suggested price” that includes the landed cost and the GPM.
Sales Staff Self Awareness
Make sure your team can view whether they are selling above or below the target GPM. While setting the GPM threshold in Komet, the system will show a warning that will let the sales team know when an item is above or below the desired selling price with green or red arrows respectively.
Track Sales Below GPM
One thing is for your sales team to know and keep track of the GPM and another is for you to know! There’s only so many orders or items that can (in specific cases) be sold under the GPM, make sure you know who’s selling under and why. To do so, you can receive notifications whenever a sale is done under the specified GPM.
Require Price Overrides
You can choose to enable the system to place orders under the suggested price on hold until a sales manager approves the price as an override. This allows you to have further control as far as price changes go.
All and all, it is imperative for managers to keep an eye on the sales process to be able to achieve goals and quotas but enforcing, tracking and monitoring the correct GPM implementation may be the single most aspect. Komet provides you with an automated way to do just that so you can have time to do what’s really important!