Customer Profitability Analysis Omega Printers Ltd handles printing jobs. Joe Patterson, finds that serving some clients is more demanding than serving others. The demands made by some clients take up a lot of time that the sales staff would prefer to spend on soliciting new clients. In particular, Joe is interested in knowing the profitability of serving Expert Travels – a travel operator and Evon Cosmetics - a retailer. The management accounting department staff of Omega printers have provided the following information. Expert TravelsEvon CosmeticsSales revenue$554,000$446,800Cost of goods sold$288,000$223,200Selling costs$86,400$64,800Administration costs$68,400$57,600 Cost driver data used by Omega Printers and traceable to the two clients are: Customer-driven activitiesCost driverCost driver rateSales activitySales visits$200 per visitOrder takingPurchase orders$ 40 per purchase orderSorting & packagingNumber of packages$ 50 per packageOrdinary shippingNumber of shipments$ 150 per shipmentSpecial shippingNumber of shipments$ 750 per shipment The following data relates to those same two clients: Customer-driven activitiesExpert TravelsEvon CosmeticsSales activity10 sales visits20 sales visitsOrder taking15 purchase orders36 purchase ordersSorting & Packaging200 packages1,500 packagesOrdinary shipping12 shipments10 shipmentsSpecial shipping3 shipments26 shipments Required: Prepare a customer profitability analysis for Expert Travels and Evon Cosmetics. Comment on the relative profitability of the two customers by computing the gross margin, net profit margin and any other relevant ratios. Suggest and explain one non-financial performance measure that Omega Printers Ltd could use to evaluate each of the following: Customer acquisition Customer retention Customer satisfaction Standard Costing and Variance Analysis Chemical Manufacturing Ltd makes a cleaning product known...
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