# Cost to serve

A term used when buying industrial supply distributor.

The full cost of serving one customer, set against what that customer actually earns.

It counts everything a customer consumes, the sales attention and the order handling and the delivery and the returns, and not the pick-and-pack cost of one line. Most sellers have never made the calculation, and when it is made a predictable thing happens: a minority of accounts earn the money and a long tail breaks even or loses. That is the improvement a buyer is paying for, and it has to be priced as work and not assumed as upside. Ask whether anybody here has ever costed a customer.

Part of: Buying an Industrial Supply Distributor (https://searchspheresource.com/guides/buying-an-industrial-supply-distributor)

Source: https://searchspheresource.com/guides/buying-an-industrial-supply-distributor/terms/cost-to-serve