Cost-to-serve
Σύντομη απάντηση
The true total cost of fulfilling an order or serving a customer: processing, picking, transport, returns and support.
Βασικά συμπεράσματα
- Manual order-processing labor (minutes × cost/hour)
- Cost of errors and rework
- Picking, packing, transport and last-mile
- Returns and disputes
What cost-to-serve is
Cost-to-serve (CTS) sums every cost of fulfilling an order or serving a customer end to end: order entry, picking and packing, transport, returns, disputes and support. Divided by order count, it gives the cost per order.
Why it matters to the board
Two customers with equal revenue can have opposite profitability if one orders often, in small quantities, with many returns. Cost-to-serve reveals the customers and channels eroding margin - invisible in the sales report.
What it includes
- Manual order-processing labor (minutes × cost/hour)
- Cost of errors and rework
- Picking, packing, transport and last-mile
- Returns and disputes
How CRMconnect helps
By automating order entry (EDI, B2B portal, order orchestration), CRMconnect cuts the heaviest cost-to-serve component: manual labor and errors. A cost per order dropping from 8 minutes to under 2 is typical.
Πραγματικό παράδειγμα
A manufacturer had a ~€9 cost per order from manual entry. Via a B2B portal and automatic import it dropped below €2 - at 40,000 orders/year, over €280,000 recovered.
Ενημέρωση:
Συχνές ερωτήσεις
Is cost-to-serve the same as landed cost?+
No. Landed cost is the total cost of getting goods to you; cost-to-serve is the cost of delivering the order to the customer.
How do I reduce cost-to-serve?+
Eliminate manual entry and errors, consolidate shipments and cut returns through right-first-time orders.
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Σχετικοί όροι
Order cycle time
The total time from order placement to delivery to the customer - a direct measure of operational speed.
ΟικονομικάLanded Cost
The total real cost of a product up to the warehouse: purchase price + freight + duties + insurance + handling.
ΟικονομικάROI (Return on Investment)
The metric measuring the net gain of an investment relative to its cost: (benefit - cost) / cost.
ΟικονομικάOpportunity cost
The value of the best alternative you give up when choosing a particular use of resources - a key concept in strategic capital-allocation decisions.