What is the sales mix?

The sales mix represents the individual sale of each product sold by the company compared to the total sale. Companies often monitor this information to determine how much profit they earn or can be able to earn when selling different goods or services. Mix goods often affect the budget of the company. Over the last month, the company sold 300 widgets and 700 cogs. The sales mix is ​​30 percent of widgets and 70 percent COGS.

Most companies try to determine the popularity of goods or services sold through the Sales Mix process. The company's budget usually starts with how many good or service units that the company expects to sell. The total expected sales price multiplied is the starting point for cash generated by normal operations. From there, the Company will state its expenses and other costs to create a certain level of sale. Most companies will experience different sales of numbers based on the combination of goods and services of the company.

The analysis of the scattering is another use of the company's sales mix. The basic calculation of scattering is the actual sale of the product minus expected - known as budget - sales. Companies multiply this number by individual gross profit for the goods and determines how much profit has been lost or obtained. This analysis helps companies to determine specific reasons why they have lost or earned more money than expected. Completion of this variance calculation for each product in the mixture helps the company focus its attention on a specific area in the company.

Adding the product to the current sales mix is ​​another purpose of this calculation. For example, a company that sells widgets and cogs - to 30 and 70 percent - can also decide that it also wants to sell plugs. Adding plugs to the sales mix is ​​likely to take Sades from widgets and cogs. Reducing sales in these units will have to be replaced by selling plugs. Using an anThe scattering alses can determine whether the plugs will be sold sufficiently to cover the expected decrease in sales in other areas.

External factors can also affect the company's product combination. Consumer intake may drop, resulting in lower sales. Substantial goods offered by a competitor may negatively affect the sale of goods or services of the company. Increased government taxes or regulations may result in higher operating costs and lower profits. Each of these factors and others can lead to the need for external analysis to determine changes in a successful sales mix.