Distributor Profitability – How much margin to give to a distributor?

Assume you're a brand or a manufacturer trying to select a distributor for your business and the terms you'll be providing are a gross-margin of 5%, zero credit period (the credit period for the distributor is zero days from the manufacturer) and the average costs for the distributor is 2%. The distributor has to extend …

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Working Capital Management and Profitability

Working Capital is the total of the amounts invested in current assets of the company. Net working capital results from the deduction of current liabilities from current assets; Working Capital Management consists of determining the volume and composition of sources and uses of working capital in such a way that would increase the wealth of …

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