March 17, 2022
Food Service Distributors have a Data Monetization Index (DMI) in the range of 27.05% to 36.54% with an average of 31.75%. The DMI for these companies is based on the valuation of customer and supply chain data.
A higher DMI is generally preferable across companies and industries. By way of reference, internet companies have a higher DMI because most of their enterprise value is derived from data. For example, Google’s DMI is 93 percent.
- Data Monetization Index (DMI) = Data Valuation / Enterprise Value
- Data Valuation = Supply Chain Data Valuation + Customer Data Valuation
- Enterprise Value = Equity Value + Long Term Debt – Cash, a key metric used in the investment community
The YDC team recently published a DMI for major Food Service Distributors in the United States. Here is an example for Gordon Food Service along with a benchmark that includes other companies in the industry.
The data valuation is based on research that indicates that better supply chain visibility can improve revenues by 11.7%. The customer data valuation for food service distributors is based on comparable companies and publicly-available data sources. The total value of data will likely be higher once additional datasets relating to product, employees and real estate are included.