Customer Profitability Analysis Oriented By Customer Value

Enterprises pay close attention to the center of the eXperience of the "valuedilemma","sales dilemma","profit dilemma","customer satisfaction "and"customer profitability and customer satisfaction ". The representative theory ofthe last stage is "80/20" rule, that only the top20%customers create80%of theprofits for the enterprise. William, on this basis, revised this theory to80/20/30law, means that the top20%customers create80%of the profits for enterprise,but the non-profit customers lost30%. Therefore, the enterprise can’t satisfyall the customers, and it is unnecessary. For enterprise’s resources are limited,and not every customer is profitable for enterprises. It is very important forcompany to distinguish which customer is profitable, and how to reasonablely measurethe customers value and effective management of customer profitability.According to the studys on customer value evaluation,we can sum up that thecustomer value evaluation system has two aspects, one is the customer current valueand the other is customer potential value. In judging the customers value, theenterprise should not only refer to the customer current value performance,customerpotential value is very important too. Customer current value determines the currententerprise profitability, it is an important aspect of customer value perception.Customer long-term potential value is related to the enterprise’s long-term profits,directly affect the customer life cycle value,which is a important factor tocompanies continue to invest in a customer relationship or not. In this article,the author use X company as an eXample, analysis the customer profitability in twoaspects:customer current value and potential value.X company is a new comepany located in a high and new technology industrialdevelopment zone.It is committed to develope and innovate the new materials, itintroduce the patent named "plant fiber materials/architecture", produce the newbuilding decoration materials which integrate environmental protection, energysaving, light weight, insulation, seismic and etc. According to the survey of theenterprise, the accounting data is full and detailed, but the customer’s data islacked. therefore, the author preliminarily calculate customer current value withthe ABC cost method directly, and the customer potential value can be got accordingto the eXploration on the influence factor and prediction on enterprise’s futurecustomer value.We use the activity-based cost to analyze the customers current value,accordingto the activity-based cost method "activities consume resources, products consumeactivity", we first determine the various resources, then find out the resourcemotivationg to spend our resources cost-sharing to12activities center, and thenaccording to the work motivation to further determine the cost of the order. Tosummary all order cost,it is concluded that the cost of each customer, so customerprofitability are obtained.Finally, the author concludes that an enterprise can not and do not have enough capacity to meet all needs of every customer, so customer profitability analysismust be conducted.The author calculates the X enterprises’ customer current valueand customer potential value, the author classify X enterprise’s customers by thepotential value and current value, the company need to take different managementstrategy by different types of customers.