Definitions for "Direct Product Profitability"
Calculation of the net profit contribution attributable to a specific product or product line.
The profit a product contributes after all its costs (DPC) are accounted for.
The allocation of all distribution costs to specific products then comparing these against standard costs with a view to identifying and eradicating inefficiencies within the distribution system. In addition, since DPP has the potential to pinpoint the costs of delivering specific products to specific customers, it also has the potential to help in devising cost effective marketing strategies.