How Do You Calculate Unit Sell Through

If you want to learn how to calculate an hourly wage using the unit rate formula keep reading.

How do you calculate unit sell through. To calculate this add up your indirect costs over the past 12 months and divide that sum by the number of units you sold in the last 12 months. Determining your overhead allocation cost per unit. If for example you found out that a competitors inventory turns was 84 that would signal that the competitor is selling product more quickly than coca cola.

You can compare this ratio to others in the soft drink and snack food industry to understand how well coca cola is doing. Sell through rate measures the amount of inventory that is sold within a given period relative to the amount of inventory received within the same period. Use this method to calculate unit cost tooyoure calculating how much 1 item is worth after youre given the amount that multiple items cost.

How to calculate sell through rate. Divide the total price by the amount of items to get the unit cost of 1 item. You purchased 100 pairs of running shoes for your sporting goods retail store and sold 75 pairs after a month.

The content of wikipedia is available under the gnu free documentation license. Dividing this with the original 10000 leaves you with the gross profit margin of 04. Using your beginning of month bom inventory you divide your sales by that bom.

Sell through units sold units received. Here are some examples. 10000 minus 6000 leaves you with 4000 gross profit.

Sell through units sold units received. So in your store if you bought 100 chairs and after 30 days had sold 20 chairs meaning you had 80 chairs left in inventory then your sell through rate would be 20 percent. Use your calculator or phone to find the unit price.

If youre doing the math by hand use long division to divide the total price by the quantity. What write down or write off costs do you incur by not being able to sell these returned products as new condition products. Lets say the product is a 6 roll pack of toilet paper for 459.

Lets consider an example of sell through rate in action. The unit price is 077. This page uses content from the english wikipedia.

This number isnt as specific since you arent calculating costs associated with sales but itll give you a good idea of how quickly youre selling through your inventory. It is calculated this way. To get the unit price youd divide 459 by 6 to get 077.

Strictly speaking sell through rate estimates how quickly a company can sell its inventory converting it to revenue. After you know how to calculate selling price of a unit you can scale this up to work out the gpmt of your business. For example if your store sold 100000 in goods and had 50000 worth of inventory then your inventory turn would be two meaning you turned over your inventory twice during that time being measured.