A management pack is a set of answers to the questions the business asked when the pack was designed. When the question changes (why is revenue up and margin down?) the pack has no page for it, and the meeting turns into a set of category managers each explaining why it is not their category.
Rebuilding margin from the ledger
We start from the general ledger and the transaction log, not the pack, and rebuild contribution three ways: by product after supply-chain cost, by store after labour and property, by basket after promotion. It takes three weeks and it always surprises someone.
1 in 5
products at a 240-store retailer contributing nothing after supply-chain cost
How it was measured
The pack showed every category profitable. The ledger showed a fifth of the range paying for the rest. Two ranges were exited; gross margin rose 3.4 points on flat revenue.
Why nobody had seen it
Because the pack allocated supply-chain cost by revenue share, which flatters low-margin, high-volume lines. Because promotions were reported by the marketing team against a different period. Because the store-level labour cost sat in a different system. None of this was wrong. It simply could not be asked the question.
What to do with the map
- Mark every line grow, hold, fix or exit, one of four, written down, with the number.
- Test any price change in a dozen stores for eight weeks before asking the estate.
- Build the function that keeps the map true. A margin map is wrong within a year; a pricing team is not.