Posted in Marketing and Strategy Terms, Total Reads: 955
Definition: Sales Volume
Sales volume indicate the quantity of different stock keeping units (SKUs) sold or the number of customers who have sought for the services offered by a firm in a given time period such a year or a fiscal quarter. Sales volume measurement is a vital part of the performance evaluation of the sales force who are responsible for selling the products of the firm.
Generally, Sales representatives are incentivised on the basis of their ability to meet their target. Since, a major part of the variable pay component depends on achieving the target, sales volume is an important metric in sales and marketing.
Increased sales volume helps company to acquire a healthy topline (revenue). Increased quantity sales mean increased production hence that also helps in increased contribution margin. Moreover, increased sales volume helps to reach break-even earlier which helps the company gain profits from their operation as early as possible.