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This may result in some loss of customers, but this could also have the net effect of "disinviting" unprofitable customers and making them the problem of another company.
- Revise incentive plans for salespersons in order to drive more profitable sales?change commission structure from gross sales volume to net operating margin. Review incentives at a customer level, rather than a total level.
Unprofitable orders should be accepted while Kanthal is reviewing how to address unprofitable customers and/or product lines. The company should also consider the "lifetime value" of each customer. While some orders from a particular customer may be unprofitable, that does not necessarily mean that every order from a customer will be unprofitable...
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