Tough Love
with Ice Cream
Summary
- US Consumer Products Company
- Customer Profitability
- Profit Improvement: $150,000 annually
The Acorn model showed this manufacturer, for the first time, the true manufacturing costs of their products. This revealed unprofitable customer/product intersections. An executive met with one customer and offered them 3 choices: (1) accept a price increase and minimum order size; (2) eliminate its private label ice cream and sell standard branded ice cream; (3) find another ice cream supplier. e customer agreed to several changes, which translated to $150,000 per year in margin improvement.