A recent study (Plastics Today; June 27, 2011) indicates processors are happy with an 8% return on sales (gross profit margin) because the historical average is 5% to 7%. If you're happy with 8% and you expect the market to give you that, then there's no reason to change your approach with respect to profit margins. You are content with the status quo and comfortable with the future. Read no more.
If, however, you don't think the market owes you a profit and you're uncertain about the future, keep reading. This is a first in a series on a proactive and proven approach for processors to manage profit margins - and it works for small-to medium-sized companies as well as larger concerns. With this approach, utilizing the new resins pricing paradigm, you can:...