Optimizing SG&A Costs: A Tale of Two Corporations

In the competitive landscape of corporate America, managing Selling, General, and Administrative (SG&A) expenses is crucial for profitability. Automatic Data Processing, Inc. (ADP) and Avery Dennison Corporation (AVY) have been navigating this financial terrain since 2014. Over the past decade, ADP has consistently maintained higher SG&A expenses, peaking at approximately $3.7 billion in 2024, a 36% increase from 2014. In contrast, Avery Dennison's SG&A expenses have shown a more modest growth, reaching around $1.3 billion in 2022, a 15% rise from 2014.

While ADP's expenses surged, Avery Dennison demonstrated a steadier approach, with a notable dip in 2023. This data suggests that ADP's strategy may involve aggressive expansion or investment in administrative capabilities, whereas Avery Dennison might be focusing on cost efficiency. The absence of data for Avery Dennison in 2024 leaves room for speculation on their future financial strategies.