Hub · Customer profitability by industry
Customer profitability, industry by industry
Revenue hides the truth: two customers of equal size can sit on opposite sides of the margin line. Customer profitability reveals which create value and which destroy it. Here is how it lands in each industry we work in.
Customer profitability is net profit per customer after the cost to serve, not just gross margin. The analysis is universal; the unit differs, a customer in distribution and financial services, an account in IT, a service line or patient group in healthcare.
Customer profitability in each industry
The 20 percent of customers who create most of the profit, and the tail that quietly gives it back, are invisible until you look.
Common questions
- What is customer profitability analysis?
- It is the measurement of net profit per customer after all costs, product cost plus the cost to serve. It distinguishes the customers who create value from those who destroy it, which gross margin alone cannot do.
- How does it differ by industry?
- The method is the same; the cost object differs. It is a customer in distribution and financial services, an account in IT services, and a service line or patient group in healthcare. In each, the cost to serve is what turns revenue into true profit.
Keep exploring
Find your unprofitable customers.
The Profit Check shows where margin is hiding, in five minutes.
Take the Profit Check