CBP

Cost Driver
EDI Orders

Rate

ABP 1 year later

Alpha

Beta

Alpha

Beta

Volume

Volume

Volume

Volume

4.5

187.5

316.35

380

627

Non-EDI Orders

9.01

562.5

16.65

20

33

Lines

0.66

15,000

10,000

11,000

20,000

457.58

12

10

10

8.64%/Yr.

300,000

75,000

75,000

150,000

25

20

10

130

12

10

10

Deliveries

Days Sales
Outstanding

Emergency Orders

Shipping & Handling

Product Sales
Cost Plus Margin
Total ABP Fees
Total Revenue
COGS

Vendor Discounts
Gross Margin
EDI Order Costs
NonEDI Order Costs
Line Costs
Shipping & Handling
Delivery Cost
Emergency Orders
Interest
Procurement

$150,000 $150,000 $150,000 $300,000

22,500

22,500

0
0
19,187
28,659
172,500 172,500 169,187 328,659
150,000 150,000 150,000 300,000

4,035

4,035

4,035

8,070

26,535

26,535

23,222

36,729

Labeling
Account
Management
Occupancy
Group Fees
Net Operating
Profit
Cost
Plus/Equivalent
Cost
Plus

You are an account manager at Owens & Minor. You have two
Activity Rates
Edi Order Cost $4.50/edi order
Non-Edi Order $9.01/non-edi order
Line Cost

$0.66/line

Delivery Cost $457.58/delivery

Interest Cost

8.64% per annum

Emergency
Order Cost

$25/emergency order

Shipping &
$130/delivery
Handling Cost

ens & Minor. You have two customers on a stockless program. Below are eac
Customer Level Costs
Procurement
Labeling
Account Mgmt.

$1,486
1,000
991

Occupancy

1,007

Group fees

750

Below are each customers activity levels, activity rates, and customer leve

nd customer level costs. See Alpha Hospital profitability statement for Beta H

tement for Beta Hospital using the format shown in Exhibit 4.

You are an account manager at Owens & Minor. You have two custo
Activity Rates
Customer Level Costs
Edi Order Cost
$4.50/edi orderProcure$1,486
Non-Edi Order Cost $9.01/non-edi oLabeling
Line Cost
$0.66/line
Delivery Cost
$457.58/deliveOccupancy
Interest Cost
8.64% per ann Group fees
Emergen
$25/emergency order
Shippin$130/delivery

ou have two customers on a stockless program. Below are each customers

mer Level Costs
1,000
Account Mgmt.
1,007
750

991

each customers activity levels, activity rates, and customer level costs. Se

level costs. See Alpha Hospital profitability statement for Beta Hospital us

Beta Hospital using the format shown in Exhibit 4.

You are an account manager at Owens & Minor. You have two custo
Activity Rates
Customer Level Costs
Edi Order Cost $4.50/edi orderProcure$1,486
Non-Edi Order $9.01/non-edi oLabeling
1,000
Line Cost
$0.66/line
Account
Delivery Cost $457.58/deliveOccupancy
1,007
Interest Cost 8.64% per ann Group fees
750
Emergen
$25/emergency order
Shippin$130/delivery

You have two customers on a stockless program. Below are each custome
Level Costs

991

each customers activity levels, activity rates, and customer level costs. S

r level costs. See Alpha Hospital profitability statement for Beta Hospital u

Beta Hospital using the format shown in Exhibit 4.