Distribution
Margin lives in the mix
and the working capital.
Distribution runs on thin gross margins and a balance sheet full of inventory and receivables. The wins are in line-item and customer contribution margin, inventory turns, and the cash conversion cycle, not the top line.
The operating reality
Revenue grows, cash gets tighter,
and no one can say which SKUs pay.
Distribution is a thin-margin, high-volume business where small inefficiencies compound. The loss-making 20 to 30 percent of revenue hides inside the blended margin, and working capital is invisible because it is a balance-sheet story, not a P&L one.
We rebuild contribution margin by SKU, line, and customer, then go after the cash, including inventory turns, obsolescence, and the cash conversion cycle. Most distributors are carrying weeks of cash they could free without touching sales.
On top of that sits the full fractional-CFO function, with 13-week cash, lender relationships, and board-ready reporting, plus the discipline to hold any margin we find.
By SKU
Contribution margin by SKU, line, and customer
DSO 45 to 35
Cash conversion cycle, tightened day by day
Turns
Inventory turns and obsolescence, made visible
Recovered
Vendor rebates and freight you are owed
What we deliver
Margin and cash, both made visible.
- Contribution margin by SKU, line, and customer
- Price realization and discount-leakage analysis
- Inventory turns, obsolescence, and cash conversion cycle
- 13-week cash flow forecasting and working-capital management
- Vendor-rebate and freight-cost recovery
- Customer-concentration and pricing decision support
- Board, lender, and sponsor reporting
- Post-acquisition integration and exit readiness
Free 2-minute assessment
Would your business survive a buyer's diligence?
Ten questions show where EBITDA and value are leaking, and how deal-ready your numbers really are. Your answers stay private.
Questions
Frequently asked.
Sales are up but cash is tight. Why?
Growth in distribution eats cash. More revenue means more inventory and more receivables before the cash comes back. If the cash conversion cycle is not managed, you can grow yourself straight into a crunch. We make the working capital visible and pull cash back out of it.
Which customers and SKUs actually make money?
Most distributors only know blended margin. We load the real cost to serve, including freight, terms, and handling, and rebuild contribution margin by SKU, line, and customer. The loss-making tail usually surprises people.
How do I get inventory under control without stocking out?
We work the turns and the obsolescence by line, not across the board, so you free cash on the slow movers without risking fill rate on the items that drive revenue. It is a margin and a cash win at the same time.
Do you support PE-backed distribution platforms?
Yes. We standardize margin and KPI definitions across sites and fold add-ons into the reporting cleanly. See our PE-backed operators page.
Ready to talk?
No retainer lock-ins. No junior consultants. Just senior-level work.