The highly competitive world of online retail can create numerous incentives for sellers to lower prices and chase revenue growth at the expense of their margins. Not all decisions that increase volume and keep the warehouse busy mean more profit at the end of the day. These decisions need to be closely monitored and routinely tested to ensure they are having the desired impact on the bottom line.
The MarginDriver Decision Model tool is designed to provide users with a means to easily test the profitability of their strategic business decisions. The tool allows users to compare custom time periods before and after the implementation of the decision and view the impact it had on revenue, margins and gross profit.
The Decision Model tool is particularly useful in testing the validity of algorithmic repricing strategies on competitive marketplaces like Amazon. Competition to get the “buy box” can be cutthroat but the effort can be futile if it only results in more work for no additional profit. MarginDriver’s Decision Model tool allows users to experiment with repricing without losing sight of the bottom line.