Unit Sales

AAA

DEFINITION of 'Unit Sales'

A measure of the total sales that a firm earns in a given reporting period, as expressed on a per unit of output basis. Typically, when using or analyzing a unit sales figure, it should be based on a physical product, such as the number of tons of coal sold, rather than on the number of services rendered.

INVESTOPEDIA EXPLAINS 'Unit Sales'

Unit sales, which is a top-line item, is a useful figure for analysts because it enables them to determine average product prices and find possible margin pressure.

For example, assume XYZ Corp. has $250 million in revenue and it sold 5 million units. By taking the ratio of the two ($250 million/5 million), an analyst can see that the average selling price is $50 per unit. Suppose that in the next reporting period, that same firm had an average selling price of $48. The analyst could see this as a red flag, which could warrant more research into the firm.

RELATED TERMS
  1. Long Tail

    In business, long tail is a phrase coined by Chris Anderson, ...
  2. Comps

    A buzzword that refers to a retail firm's comparable same-store ...
  3. Top Line

    A reference to the gross sales or revenues of a company, or an ...
  4. Analyst

    A financial professional who has expertise in evaluating investments ...
  5. Income Statement

    A financial statement that measures a company's financial performance ...
  6. Contribution Margin

    A cost accounting concept that allows a company to determine ...
RELATED FAQS
  1. Who are General Motors' (GM) main suppliers?

    General Motors Co. (GM) has a long list of over 70 suppliers. Among the major suppliers of component parts to GM are NGK ... Read Full Answer >>
  2. What is the difference between marginal benefit and marginal revenue?

    Marginal benefit measures the consumer's benefit of consuming an additional unit of a good or service, while marginal revenue ... Read Full Answer >>
  3. How does a company determine the right level of sales volume?

    A company determines the right level of sales volume by conducting a cost-volume-profit analysis. This helps a company figure ... Read Full Answer >>
  4. What are the most popular companies in the automotive sector right now?

    There are multiple ways to define the popularity of companies. Market capitalization measures the market value of a publicly ... Read Full Answer >>
  5. What's the best-selling iPhone model of all time?

    Apple's iPhone 6 and its larger cousin the iPhone 6+ are the bestselling iPhone models of all time, with the iPhone 6 coming ... Read Full Answer >>
  6. Why do economists think it is important to track discretionary income?

    Economists track discretionary, and disposable, income as a proxy for the growth in the financial health of average citizens ... Read Full Answer >>
Related Articles
  1. Fundamental Analysis

    Great Expectations: Forecasting Sales Growth

    Predicting sales growth can be something of a black art, unless you ask the right questions.
  2. Markets

    How To Use Price-To-Sales Ratios To Value Stocks

    Take a look at how this effective ratio can be influenced by certain critical factors.
  3. Forex Education

    Understanding The Income Statement

    Learn how to use revenue and expenses, among other factors, to break down and analyze a company.
  4. Investing

    Doing More With Less: The Sales-Per-Employee Ratio

    If used properly, this ratio can give you insight into a company's productivity and financial health.
  5. Economics

    Calculating Income Elasticity of Demand

    Income elasticity of demand is a measure of how consumer demand changes when income changes.
  6. Economics

    Understanding Implicit Costs

    An implicit cost is any cost associated with not taking a certain action.
  7. Economics

    Understanding Diseconomies of Scale

    Diseconomies of scale is the point where a business no longer experiences decreasing costs per unit of output.
  8. Economics

    What Does Capital Intensive Mean?

    Capital intensive refers to a business or industry that requires a substantial amount of money or financial resources to engage in its specific business.
  9. Economics

    What is an Original Equipment Manufacturer (OEM)?

    An OEM is a company whose products are used as components in another company's product.
  10. Economics

    Good Economic News The Cynics May Be Missing

    Headline data about the U.S. economy hasn’t been great, but the economy is actually stronger than it’s getting credit for.

You May Also Like

Hot Definitions
  1. Radner Equilibrium

    A theory suggesting that if economic decision makers have unlimited computational capacity for choice among strategies, then ...
  2. Inbound Cash Flow

    Any currency that a company or individual receives through conducting a transaction with another party. Inbound cash flow ...
  3. Social Security

    A United States federal program of social insurance and benefits developed in 1935. The Social Security program's benefits ...
  4. American Dream

    The belief that anyone, regardless of where they were born or what class they were born into, can attain their own version ...
  5. Multicurrency Note Facility

    A credit facility that finances short- to medium-term Euro notes. Multicurrency note facilities are denominated in many currencies. ...
  6. National Currency

    The currency or legal tender issued by a nation's central bank or monetary authority. The national currency of a nation is ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!