All Commodity Volume (ACV)

Posted in Finance, Accounting and Economics Terms, Total Reads: 3719

Definition: All Commodity Volume (ACV)

All Commodity Volume or ACV is a sum of all category sales in a store. ACV is a ratio & hence is measured as a percentage. It is a very important measure in the retail world because it helps to grow your sales & it helps in better placement(distribution). All Commodity Volume helps companies to adopt strategies & to achieve a balance between a “Push” & a “Pull”. A company’s ACV gives it the measure of how effectively the company is communicating its brand to its customers & how much it is contributing to the sales. It helps in the distribution or placement of the products of a company across different geographies. ACV distribution gives products sold by the retailers as a percentage of all outlets.

Importance of All Commodity Volume (ACV)

All Commodity Volume helps to figure out the retailers those are not keeping the particular brand. It is also used to know if a company is able to meet its distribution goals for a new product and which retailers are keeping or selling their new product. Therefore, it helps in better distribution the products across different geographies by showing the size of the store not on the basis of physical square foot but the amount of product the particular retailer is selling.

All Commodity Volume (ACV)

ACV helps us to answer the following question:

1. Are all retailers carrying my product ?

2. Are the distribution goals being met ?

3. My Store Sales are down. What is really happening in the stores ?

4. Can I identify which retailers are at least selling one of my new products ?

Thus to conclude we can say that % ACV  is the “% of stores selling” but with stores weighted based on their size & we get more credit for being there in large stores than in smaller ones.

Category Performance Ratio (CPR) is also calculated using the ratio between Product Category Volume and All Commodity Volume (ACV). All these are known as distribution metrics.

Formula for All Commodity Volume (ACV)

Your company’s ACV gives you the measure of how effectively you are communicating your brand to your customers & in change how well is that working out for your sales.

ACV is given by:

ACV (%)= 100 * Total Sales of Stores Carrying Brand /  Total Sales of all Outlets

% AVC conveys the total sales of the retailer carrying the brand relative to total sales of all retailer in a particular geography.

Example of All Commodity Volume

We have two Stores:

Store A: $ 400 In Total Sales  ( All Products)

Store B: $ 100 In Total Sales (All Products)

Total Value: $ 400 + $ 100 = $ 500

If suppose a ketch up “Maze” is sold only in store A, then  What is the % ACV ??

Store A % ACV – 80% [ 400/500]

Store B % ACV – 20% [100/500]

Hence, this concludes the definition of All Commodity Volume (ACV) along with its overview.

Browse the definition and meaning of more terms similar to All Commodity Volume (ACV). The Management Dictionary covers over 7000 business concepts from 6 categories.

Search & Explore : Management Dictionary

Share this Page on:
Facebook ShareTweetShare on G+Share on Linkedin