Product sales volume

Seasonality must be considered when applicable. For some products, sales volumes peak at certain times of the year (such as toy sales at Christmas) in other cases, raw materials, such as fresh fruits and vegetables, may only be available at specific times. Both cases require out of-season storage. Manufacturers must invest in warehouses, use third parties, or provide incentives to intermediaries so they perform the storage function. For example, manufacturers might offer a seasonal discount or consignment inventories to wholesalers or retailers who agree to take early delivery. 

Three case studies are presented in this section. The first two studies desalbe the application of conceptual profiling to High Street pharmacy retailer brands and to the development of a derived index of fit-to-brand in the Single Malt Scotch Whisky category. The third study explores the relationship between our derived index of fit-to-brand and new product sales volumes. 

Case Study 3 - exploring the relationship between the derived index of fit-to-brand and new product sales volumes... 

Product sales volume can shape assortment strategy, although occasionally in contrasting ways. Perhaps seeking the advantages of focus, Macy s... 

Change in pricing. This may impact sales contracts and revenue sharing contracts among the enterprise partners due to a potential change in product sales volume or its market share. 

From the point of view of appHcation, pharmaceutical fine chemicals constitute the largest part of all fine chemicals, both in terms of number of products and volume of sales. About 40—50% of the total fine chemicals sales comes from pharmaceutical fine chemicals about 20 to 25% are agrochemicals, and the rest belong to other categories. 

Household and personal products dominate surfactant technology Hterature. Sales volume per product ia these categories is large enough to justify research and investment ia large manufactuting facilities. Industrial appHcations represent smaller sales volumes per product. Research and especially technical service is often conducted by the user or by a service company that suppHes a variety of items to the consuming iadustry. 

Economic summaries of the cosmetic industry, commonly documented by sales volume, are sometimes based on unit sales, sometimes on manufacturers sales in monetary units, and sometimes on consumer spending. Figures normally include contributions by private labeling operations but do not necessarily reflect the value of the industry service sector, which includes suppHers of raw materials, beauticians, testing laboratories, and other speciaHsts. Moreover, product categories caimot be rigidly defined. For example, the differentiation between a deodorant (a cosmetic) and an antiperspirant (an OTC dmg) is often obscured by its trade name. 

The quantity of annual sales is often called the sales volume, although the units may be mass quantities instead of volume units. The estimation of the annual sales volume over the expected life of a production faciHty is extremely difficult. It requites an estimate of the total market, production capabiHties and costs of the competition, market share expected, selling strategy to be employed, and future economic conditions. 

Breakeven charts can be plotted in any of the three forms shown in Figs. 9-2, 9-3, and 9-4. The abscissa shown as annual sales volume R is also frequently plotted as a percentage of the designed production or sales capacity Rq. In the case of ships, aircraft, etc., it is then called the percentage utilization. The percentage margin of safety is defined as... 

Sales and raw-materials prices may be affected by any of the following discounts and allowances, availabihty of substitutes, contract pricing, government regulations, quahty and form of the materials, and competition. Sales volume may be affected by any of the following new uses for the product, new markets, advertising, quahty, overcapacity, replacement by another product, competition, and timing of entry into the market. 

The estimated (DCFRR) and the estimated (NPV) are both functions of the estimated cumulative revenue from annual sales X As, the estimated cumulative total annual cost or expense X Ate, and the estimated fixed capital cost Cfc of the plant. The revenue from annual sales for each year is in turn the product of the sales price and sales volume. Initially it is desirable to select those values from the distribution cui ves of X As, X Ate, and Cfc which enable the maximum and minimum (DCFRR) and (NPV) to be calculated. 

Inventory Ejfect on Cash Income and Profit When the annual production rate is equal to the annual sales volume, the revenue from annual sales As is... 

However, in a given accounting period the sales volume mav differ from the volume of production. In this case, the inventoiy of finished product 7i at the beginning of the accounting period will differ from... 

If the annual sales volume exceeds the annual production rate R by an amount AR, then Eqs. (9-147) and (9-148) can be written as... 

If the sales volume exceeds the annual production rate by 10 percent and the inventory is valued at the sales price, then Eq. (9-153) shows that the profit margin is (A vf/As)100 = 0 percent. If the inventory is valued at the total variable cost, then the profit margin (A vf/As)100 = (0.1)(1 — 0.7) (100) = 3 percent. Hence, the value of the inventoiy is of vital importance. 

Most people agree that general expenses incurred in administration, selling, distribution, etc., should not be included in the cost of inventory. In fact, many feel that no costs should be absorbed before they have been incurred. In general, method 2 is favored by engineers and method 3 by most accountants. However, the accountancy convention is to value at either cost or market value, whichever is the lower. In the methods considered, either ac tual or standard costs can be used. Note that method 3 shows a higher profit than method 2 when sales volume exceeds the produc tion rate and a lower profit when the production rate exceeds sales volume. 

Revenues. The selling price for the major product and the quantity to be sold each year must be estimated. If the product is new, this can be a major study. In any case, input is needed from sales, transportation, research, and any other department or individual who can increase the accuracy of the revenue data. The operating costs may be off by 20% without fatal results, but a 20% error in the sales volume or price w ill have a much larger impact. Further, the operating costs are mostly within the control of the operator, while the sales price and volume can be... 

In the preparation of the first edition of this volume, contact was made with IMS, Inc. of Ambler,Pa.,a well-knownsourceof international statistics. Withtheir help,a list was prepared of the 100 top products based on U.S. sales volume in 1976 that list is given in Table 1. 

In the final analysis, market price and sales volume are functions of the quality standards offered and the buyer s degree of confidence that the product will conform to the standards. Maintenance of buyer s confidence requires inspection to screen out all nonconforming products, or control over variability of quality during production and distribution to a degree where few, if any, products fail to meet the standards. Screening inspection of the finished product cannot improve quality it merely serves to segregate unacceptable from acceptable product, and results in loss of production capacity and costly waste and salvage. The second consideration provides the only sound basis for quality control in frozen food production and distribution. It operates on the old principle that an ounce of prevention is worth a pound of cure. ... 

Figure 1.36 Sales-volume forecast for the field of microreaction technology for the next few years. A projection is given on when industrial production will set in [241],...

No information concerning the specific production volumes of mineral oil hydraulic fluids was found in the available literature. The National Petroleum Refiners Association (NPRA 1992) reported that 192 million gallons of automatic transmission fluids, universal tractor hydraulic/transmission fluids, energy/ shock absorber and power steering fluids, and other automotive hydraulic fluids were sold in 1991. Virtually all of these fluids are mineral oil hydraulic fluids (Chrisope and Landry 1993 Papay 1989, 1991 Wills 1980). This volume is lower than sales volumes for 1990 (216 million gallons), 1989 (221 million... 

The classical royalty model, where the license fee is based on the added value of the new technology for the customer. As a mle, the royalties depend on the production volume and/or value of the chiral compound produced with the proprietary ligand, and are usually a percentage of product sales or a similar reference number. Also accepted are volume-independent royalties such as up-front or milestone payments. 

Net turnover composed of the product of net prices and net sales volume having customer rebates already deducted... 

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