9.3 Alternative Channel Profitability (Figure 9-24)

Analysis Scale
Thousands
Area of Performance Starting Data Hold - Profit Hold - Share
Channel Strategy
Indirect Retailer
Direct Sales Force
Direct Sales Force
Market Demand
1000
1000
1000
Market Share
20.0
%
0.0
%
0.0
%
Volume
200
0
0
End User Price (*)
$1000
$
$1000
$
$1000
$
Retailer Discount
20
%
0
%
0
%
Wholesale Price (*)
800
1000
1000
Distributor Discount
0
%
0
%
0
%
Sales Agent Commission
0
%
0
%
0
%
Net Price (*)
800
1000
1000
Company Sales Commission
0
%
0
%
0
%
Transaction Costs
2
%
5
%
2
%
Pocket Price (*)
784
950
980
Sales Revenues
156800
0
0
Unit Cost (*)
$650
$
$650
$
$650
$
Percent Margin
17.1
31.6
33.7
Marketing/Sales Expense (%)
5.0
%
0.0
%
0.0
%
Marketing/Sales Expense ($)
7840
0
0
Net Marketing Contribution
18960
0
0
Marketing ROS
12.1
0
0
Marketing ROI
242
-100
-100
Breakeven Market Share
5.9
0.0
0.0

(*) Not Scaled

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