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Key Account Management, 5th Edition by Peter Cheverton

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33

Measuring customer profitability

Is it a reasonable assumption that KAM will be more profitable than traditional selling? The only possible answer to this question is: never make such an assumption.

KAM might not have been pursued principally with that aim in mind – it might have been pursued in extremis, as a ‘survival strategy’. In such a case, to compare levels of profitability with ‘what used to be’ may be very misleading. What was is gone, and KAM is now a necessity. Without it, we die.

It may be true that the practice of KAM results in a more efficient use of resources, but does that inevitably lead to increased profits? Consider the tale of the National Health Service.

The tale of the NHS

In the UK in the 1940s, the creation of the ...

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