Who Optimizes SG&A Costs Better? ZTO Express (Cayman) Inc. or Rentokil Initial plc

Optimizing SG&A Costs: A Comparative Analysis

In the competitive landscape of global business, managing Selling, General, and Administrative (SG&A) expenses is crucial for profitability. This analysis delves into the SG&A cost optimization strategies of ZTO Express (Cayman) Inc. and Rentokil Initial plc from 2014 to 2023.

A Decade of Financial Strategy

Over the past decade, Rentokil Initial plc has demonstrated a remarkable ability to control SG&A expenses, maintaining an average of approximately 1 billion annually. Notably, in 2019, their expenses plummeted to a mere 32% of their 2023 peak, showcasing strategic cost management.

Conversely, ZTO Express has seen a steady increase in SG&A costs, peaking at 2.4 billion in 2023, a 354% rise from 2014. This trend reflects their aggressive expansion strategy.

Conclusion

While Rentokil Initial plc excels in cost efficiency, ZTO Express's rising expenses highlight their growth ambitions. Investors should weigh these factors when considering long-term investments.