Welsh Businesses Sweep the Board in Customer Assessment League; RESEARCH: More Than Two-Thirds of Companies in Wales Are Astute in Targeting Their Desired Markets
Byline: SION BARRY
WELSH businesses are among the best in the UK in terms of accurately determining their profitable customers and products, according to research from KPMG.
In Wales more than two-thirds of companies are astute in assessing their most valuable products and those willing to pay for them, compared to the UK average of 50pc.
The survey, which polled managing directors and finance directors of businesses with an annual turnover of pounds 1m to pounds 100m, found that 76pc of businesses in Wales use customer/product profitability analy-sis to help manage their business performance and cash flow on a detailed ongoing basis.
Alun Bowen, senior partner at KPMG's Cardiff office, believes many companies make financial decisions based on gross margins rather than using a meaningful and objective analysis of how overhead costs relate to product and customer groups.
He said, ``Many businesses in the UK are paralysing themselves by try-ing to sell every small element within their portfolio to bring in cash, although our survey found that businesses in Wales have made positive steps to address this.
``Appropriate costing techniques, which give full appreciation of overhead costs and what is driving the consumption of cash, should be an integral part of business planning. …