If you want to use e-procurement tools to drive cost reductions you have to understand the financial end of the business.
This is the final in a three part series.
At a very high level and retail summary P&L might look something like the example below. Each retail industry sub vertical will look a little different. The percentages in each category absolutely will… If you can understand the underlying pressure points then and only then will your e-procurement discovery drive the results that a CEO or CFO are interested in.
Gross Sales
Cost of Goods Sold
Gross Profit
Operating Expenses
Net Operating Income
Gross Operating Expenses
Officer Compensation (CEO, CFO Etc.)
All other Salaries and wages
Maintenance (Cost of Repairs)
Bad debt write off
Facility Expenses (Rents)
Taxes
Interest
Amortization
Depreciation
Advertising Expense
Benefits
Misc expenses
Retirement Plans
Total Operating Expenses
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