Your revenue is visible. Your margin leakage is not.
How true profitability by customer, product, channel and payment behaviour hides in the data you already own.
Hypothesis
In a mid-market group, reported margin is an opinion. The cash-true margin — by customer, product, channel and payment behaviour — is already inside the ERP, and it rarely matches the management pack.
Evidence
- The four axes we recompute together (customer, product, channel, payment behaviour) are almost always present as raw fields; what is missing is the join that treats a late-paying customer as a discount, not a receivable. Once the join is applied, the top-decile customer table reorders.
- Discount registers, rebate accruals and shipping allocations sit in different systems and rarely reconcile to the P&L presented to the board. Recomputing them against the cash ledger, rather than against the sales system, is where the leakage first becomes visible.
- Payment behaviour is the axis most often missing entirely. Treating days-sales-outstanding as a customer-level margin adjustment, not a treasury metric, changes both the pricing decision and the credit decision — and both are usually made by different people from different reports.
Verdict
Before you approve the next commercial plan, insist on one page: cash-true margin by customer, product, channel and payment behaviour, reconciled to the cash ledger. If the page does not exist, the plan is priced on an opinion.
Provenance of this note
No jurisdiction is recorded for the casework behind this note, so it is published as a general practitioner observation rather than as evidence from a named legal or accounting regime.
Practitioner observation — not a measured study. No baseline and no sample size are published for this note, so it must not be read as a quantified claim.
- Owner
- Bruno Hounkpati · Operating Chair
- Attribution
- Stredge Partners casework — engagements re-opened under the evidence method. Individual engagements are confidential.
- Measurement window
- 1 January 2024 – 30 June 2026
- Baseline
- Not published
- Sample size
- Not published
- Method
- Practitioner review of engagement records. No controlled sample was drawn and no baseline was measured, so this note states a pattern, not a quantity.
Citations
- Instrument — Stredge Partners · MarginLeak X-Ray™ method statement, v2026.2 (shared on request before an engagement letter).
- Related note — The pilot-to-P&L problem (AI, honestly · No. 08) — in preparation.