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Revving Up Sales & Maximizing Customer & Product Profitability with SIOP
From:
Lisa Anderson M.B.A. - Manufacturing and Supply Chain Lisa Anderson M.B.A. - Manufacturing and Supply Chain
For Immediate Release:
Dateline: Claremont, CA
Friday, July 4, 2025

 

As companies experience slowing backlogs, high interest rates, and inflationary spikes in costs over the last few years, revving up sales and keeping margins intact has become of paramount importance. The business environment has become volatile and challenging, requiring forward-thinking, bold strategies. Thus, leadership is turning to SIOP (Sales Inventory Operations Planning) and advanced strategies to create a path forward and surface key decisions ahead of critical junctures in the business. SIOP is a predictive process that will highlight opportunities to grow sales, raise prices, and maximize customer and profit profitability.

Case Study: Building Products Manufacturer with Aggressive Growth Plans

An innovative building products manufacturer wanted to aggressively grow the business while keeping costs intact so that they could fund their business growth. Their business was highly seasonal because customers valued their product and were reminded of its value during the summer season. Thus, handling aggressive growth required foresight and planning. Thus, they focused critical attention on their sales strategies, CRM (customer relationship management) and BI (business intelligence) reporting, and sales forecasting models, which all rolled into their SIOP planning processes.

SIOP ensured a regular cadence and focus on revving up demand, a review of progress with key insights, and alignment with operations while keeping finance on the same page to ahead of the resources required to support the growth plans. The sales team used Salesforce to proactively track potential customers, review progress in the sales cycle, and estimate potential opportunities by geography and product. In reviewing sales and customer trends and insights, opportunities emerged to focus additional resources in certain geographies, market segments, and/or new product development initiatives. High potential opportunities were included in the demand planning discussions and high-level insights were included in the SIOP process to align cross-functional teams on the opportunities to grow sales while keeping costs intact.

As sales growth levels increased, it became challenging to keep up with operations while accounting for peak season, proactively alerting key suppliers, and managing inventory levels to mitigate cost and cash bottlenecks. SIOP provided an item level demand plan by month in alignment with prior seasonal trends while incorporating growth plans and customers insights. The team turned to a predictive demand and supply planning software to rapidly incorporate changing conditions and provide recommendations for supply requirements (planned production and purchase orders). These summarized demand and supply plans were reviewed during the SIOP process in addition to new product development plans correlated to sales objectives so that they could be tightly coordinated with Sales, Operations and Finance. This alignment and coordination enabled the company to grow rapidly and double their business over the next few years while maintaining and improving margins.

Case Study: Consumer Products Manufacturer Deep Dives into Margins

A consumer products manufacturer started to see a deterioration in margins and their ability to forecast costs. Thus, they worked with supply chain consultants to upgrade several core processes (operations, inventory, supply chain, and use of ERP) to right the ship. However, these actions alone were not sufficient. They wanted to be able to forecast and better impact their sales revenues and operational costs to return to profitable growth. Thus, they turned to SIOP.

As they rolled out SIOP, they started with historical sales, reviewing trends by key customer and product line. The frequency of orders and order sizes impacted cost, and so they incorporated these variables into the analysis. Pricing was a mess as there were large rebates from key customers like Amazon several months after the initial sale, muddying the picture of margins by customer. We worked with the ERP resources and internal teams to develop directionally correct pricing and rebate trends and allocating these by customer. This resulted in customer and product revenue, pricing and profitability graphs. Clear opportunities emerged.

From the operations perspective, we derived directionally correct run rates for key products and work centers. The Engineering team updated key routings and boms to support reasonable projections. Instead of assuming the spaghetti-like operational flow would carry forward, we developed lean principle derived cells and addressed bottleneck operational steps. Taking the 80/20 view, we developed capacity and staffing forecasts to support the demand plan and estimated the resources required by job skill. Thus, operational plans and upgrades could be pursued.

By rolling out a monthly SIOP review and refresh of the demand and supply planning processes, the team could proactively address changing conditions and keep an eye on improvements. The Board used the SIOP plans to review key decisions, set priorities, and hold leaders accountable. Sales also had a game plan of customers to meet with to discuss pricing, rebates, and sales opportunities to drive revenue and margin improvements.

SIOP: The Path Forward

SIOP can be used as an integral part of your sales planning and budgeting process. More importantly, SIOP will highlight pricing, mix, and margin opportunities while aligning all functions on the single source of truth. it is a collaborative, forward-thinking, and strategic process to align demand with supply and Sales with Operations to transform your supply chain and drive business results. To learn more about how to rollout SIOP, download a complimentary copy of our book, “SIOP (Sales Inventory Operations Planning): Creating Predictable Revenue and EBITDA Growth“. Bottom line results will follow.

Did you like this article?  Continue reading on this topic:
Using SIOP to Drive Revenue, Margin, & Working Capital Predictability & Improvement

About LMA Consulting Group
Lisa Anderson is the founder and president of LMA Consulting Group, Inc., specializing in manufacturing strategy and end-to-end supply chain transformation. A recognized supply chain thought leader, Ms. Anderson has been named among the Top 40 B2B Tech Influencers, Top 16 ERP Experts to Follow and Top 10 Women in Supply Chain. Ms. Anderson has been featured in Bloomberg, Inc. Magazine, the LA Times, PBS, and the Wall Street Journal. She is an expert on the SIOP process and has published an ebook. SIOP: Creating Predictable Revenue and EBITDA Growth. Most recently, Ms. Anderson introduced Supply Chain Bytes, a video series featuring short, under-2-minute updates on the latest trends and insights in supply chain management, designed to keep businesses informed and agile in a rapidly evolving environment. For more information on supply chain strategies, sign up for her Profit Through People® Newsletter or visit LMA Consulting Group.

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Media Contact: Kathleen McEntee, Kathleen McEntee & Associates, Ltd., (760) 262 – 4080, KathleenMcEntee@KMcEnteeAssoc.com

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Name: Lisa Anderson
Title: President
Group: LMA Consulting Group, Inc.
Dateline: Claremont, CA United States
Direct Phone: 909-630-3943
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