Customer profitability refers to the difference between the profits that a company earns from the customers, and the amount that the company spends on its customer services. The customer profitability analysis refers to the assessment or evaluation of this monetary differences and finding out whether the customer or the company is emerging profitable. The report is usually prepared by financial analyst of the company.
Sample Customer Profitability Analysis:
Customer Profitability analysis prepared for: Limetex Shopping Mall.
Report prepared by: Mr. Alex Gomes, financial analyst.
This report tries to analyze the customer profitability over a period of one year. It is prepared by the financial consultant group, under the supervision of the financial analyst. The primary tools used to prepare this are sales record, income flow and profitability computation software.
Company Investment on Customer services $ 25,000
Advertising and promotion costs $ 8,800
Promotional messaging $ 2000
Special offers $ 7000
Total investment on customers $ 42,800.
Company revenues per year $ 86,000
Profit in special offers $ 23,000
Other profits from sales $ 4000
Total Profit earned $ 113000
The report prepared by the financial consultancy team of our company, clearly indicates that the company makes a profit of $ 70200 over a period of one year. The amount it invests on the customer services is far less from the profit that it makes. However, the customer retention rate of the company is also high, which indicates its steady progress. A detailed analysis report is enclosed herewith this statement, for the company’s perusal.
Mr. Alex Gomes,
Financial analyst, Limetex Shopping Mall.