The comparison of basic and basic activity methods in customer profitability analysis

The purpose of this study, find out the differences in the profit margins which the customers contributions to make strategic decision of any company. All customers are not equal because the contribution of sales revenue of customers is not equal the contribution of company's profitability. In this situation, company's strategic decision making period need customer profitability analysis. Calculating the profitability of individual customers or customer profitability analysis implies looking at profitability at the customer level, instead of at the product level. Customer profitability analysis examined in two dimensions; customer cost and customer revenue. In this study customer profitability performed using activity based costing technique. In the past, management accounting reports have tended to concentrate on analyzing profits by products. The company is calculated the contribution of the customer to company profitability by traditional cost management. Traditional costing assumed that all of the customer is equal contribute to company's profitability. Information was also given that traditional systems were not appropriate to todays conditions, newer costing techniques needed to be realized. In this study, FTM and ZEFT method are introduced and analyzed. In this study is to expose how the cost of the total production and selling activities, which are performed by the production, and selling firms with the assistance of activity based costing and time driven activity based costing will be charged to the customers. Additionally in this study tries to find out the differences in the profit margins which the customers contributions in the accommodation sector. Different purchasing behaviours and different product's cost is caused by different profits. All customer cost is not equal each customers.