Did You Actually Make Money This Year?
How wholesalers can recut the numbers and find out what 2025 really looked like
You moved product. You hit revenue targets. You may have even grown year-over-year.
But here’s the uncomfortable truth: top-line growth doesn’t mean you made money.
Too many wholesalers are closing out the year thinking they had a good run—until they dig into the deductions, freight bills, and storage costs still sitting off their P&L.
If you want to know what 2025 really looked like, now’s the time to recut your margin.
Step 1: Pull Your Gross Margin by Retailer or Channel
Start with the basics: net sales minus COGS. Do this by channel or major account, not just in aggregate.
Now comes the hard part.
Step 2: Subtract the Real Costs You’ve Been Avoiding
Gross margin looks good—until you adjust for:
Chargebacks and deductions (especially unrecognized ones)
Freight-in and fuel surcharges (likely way up this year)
Returns, RTVs, and repackaging fees
Carrying costs on inventory that sat longer than forecasted
Expedited shipping or routing noncompliance penalties
These often live in different systems—your ERP, your 3PL portal, your factor’s aging. Pull them all together.
Step 3: Recut Your Margin—Then Re-rank Your Retailers
Once you’ve accounted for the full costs, rebuild your margin report. You might be shocked.
That “great” national retailer? You may be barely breaking even.
That regional account you don’t prioritize? It might be quietly driving more profit than your biggest name partner.
Use this to re-rank your accounts:
Who deserves more inventory allocation?
Who needs tighter compliance workflows?
Where do you need to raise prices—or walk away?
Step 4: Lock in Cleaner Processes for 2026
Once you’ve found the margin leaks, take action:
Create a deduction tracker by retailer or reason code
Build compliance guides for your warehouse or 3PL
Talk to your factor about improving deduction visibility
Review your cost assumptions for 2026 forecasts
You didn’t work this hard all year just to find out you gave your margin away.
Recut the numbers. Know your truth. Enter 2026 smarter.
Need help pulling it all together? That’s what we do at BDS.