Measuring Marketing

Chapter 91 Net Sales Contribution

Measurement Need

To determine how much a particular entity represents of the total sales of all entities.

Solutioni

Net sales contribution calculates the financial sales contribution of a specific segment or sales territory to total sales for all segments or territories, expressed as a percentage. Note that territories can be defined geographically and/or in terms of customer or product type.

The formula for net sales contribution is:

$S_{ni}=\frac{S_i}{{\displaystyle \sum S_i}}\times 100$

Where

Sni = net sales contribution for segment or territory i

Si = sales from segment or territory i

ΣSt = total sales from all segments or territories

To illustrate, assume a company has total sales of $100 million, with sales from territory ...