B-to-B Cataloging Every Cataloger's Guide to Analysis
Response rate. On a segment-by-segment basis, divide your number of orders by the total number of pieces mailed.
Average order value. On a segment basis, divide your gross sales by your number of orders.
Contribution per segment. Contribution is short for "contribution to overhead." It's different than a fully loaded profit/loss number. In this article, I define contribution as dollars left after taking your gross sales and subtracting your promotional expenses, cost of goods sold and any applicable returns or discounts. Some catalogers take it a step further and subtract their variable fulfillment cost, which is how much it costs you to fulfill an order after taking into account your shipping revenue. If you subtract your variable fulfillment cost but have trouble getting an exact number, use an average. (Twelve percent of gross sales is the catalog industry average.)
- People:
- George Hague Editor
- J. Schmid
- Places:
- Mission, Kan. Reach