5. Enabling Margin Growth

The previous chapters introduced several alternatives for increasing sales volume and sales revenue through supply chain management.

The third way supply chain creates value for shareholders is by reducing costs that directly impact the margin of contribution. Margin growth is the immediate consequence of supply chain cost reduction. This chapter structures this concept in three parts (see Figure 5.1):

1. Reduce cost of sales

2. Balance asset management

3. Balance service and cost


Figure 5.1 Enabling margin growth

Reducing Cost of Sales

The concept of cost of sales or cost of goods sold (COGS) was introduced in Chapter ...

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