Sales Bridge and Volume Mix Price Analysis

Introduction

• Previous blog post discussed building a sales bridge (volume mix price analysis).
• Focus: Analyzing the gap between budget and actual sales.
• Explains how to calculate three effects: Volume, Mix, and Price.
• Excel file available for download with examples and formulas.

Understanding the Effects

• Sales Information Example: Includes budget and actual figures.
• Formulated columns in Excel for:
  • Volume Effect
  • Mix Effect
  • Price Effect

Price Effect

• Calculation: Difference between actual and budget price multiplied by actual units sold.
  • Example Reference: Tea Red
    • Increased price to €210 results in:
      • Positive deviation of €300 (10€ increase x 30 units sold).
  • Negative Effect: If sales price decreases (e.g., Tea Green).

Volume Effect

• Restoring Initial Prices: To focus on volume changes without price influence.
• Positive Volume Effect: Example with 5 additional units of Tea Red.
  • Results in positive volume and mix effects.
• Negative Volume Effect: Reducing units of a reference (e.g., Tea Integral).
  • Total actual units equal to budget units results in:
    • Positive deviation due to mix effect only.

Mix Effect

• Definition: Change in the mix percentage of different references over the total.
• Example: Selling the same volume total but different mix can result in a positive mix effect.
• Impact of Volume Change: If the overall mix ratio stays the same but volume doubles, volume impact occurs without mix impact.

Conclusion

• Summary of effects:
  • Price Effect: Directly influenced by price changes.
  • Volume Effect: Influenced by changes in unit sales.
  • Mix Effect: Influenced by the proportion of sales among different products.
• Encouragement to apply these concepts in practical scenarios.
• Closing remarks: Thanks for watching, see you in the next video!