Pricing framework for four brands
Price positioning for four brands, cost control and higher average order value through pricing across the product range.
Read the case studyCommercial analytics
Transaction-level unit economics
Allocating outlet P&L expenses to individual transactions to assess sales channel profitability and inform budget decisions.
Project leadContext and challenge
Managing sales channels required an assessment of the final profit generated by individual transactions and transaction groups. The calculation needed to include sales value, acquisition costs and the internal costs of fulfilling an order. This required a consistent methodology for allocating shared outlet expenses from the P&L to individual transactions.
My contribution
I developed and implemented a unit economics methodology that allocated expenses across all outlet P&L categories to individual transactions. I defined several profitability levels according to the costs included in each calculation. The methodology enabled transaction groups to be analysed through to final profit and supported decisions on sales channels, resources and budgets.
Approach and solution
Allocating P&L expenses to transactions
- Developed a method for allocating shared outlet expenses to individual transactions. It covered all P&L expense categories and connected the outlet’s financial performance with the economics of individual sales.
- Included transaction revenue, acquisition costs and internal order fulfilment costs in the assessment. This made it possible to calculate profit after allocating outlet expenses and account for the full economics of completing the sale.
- Introduced the methodology into commercial analytics. Consistent calculation rules were used to assess individual transactions and subsequently analyse transaction groups.
Multiple profitability levels
- Defined several transaction profitability levels based on the expenses included. This structure showed how the financial result changed as more of the cost base was taken into account.
- The assessment extended to final profit after all expenses had been allocated. Analysis across the levels helped identify which costs affected transaction profitability and where further cost review was needed.
Assessing sales channels and additional transactions
- The methodology allowed transactions to be grouped by sales channel and each group’s financial result to be assessed after allocated expenses. It provided a basis for channel KPIs and commercial policy decisions.
- The effectiveness of acquiring additional transactions was assessed through their final profit, accounting for acquisition and internal fulfilment costs. This approach helped select channels for development and identify areas where costs needed to be optimised.
Outcome
The company gained a methodology for assessing transactions and sales channels through to final profit after all allocated expenses. It enabled better-informed allocation of resources and budgets, helped prioritise channel development and identified opportunities to optimise costs. The calculations became a basis for sales channel KPIs and commercial policy decisions.
Get in touch
I’d be happy to discuss working together
We can discuss ongoing collaboration, a project or a specific analytical task. Contact me by email or WhatsApp.
I live in Tbilisi, Georgia.
I am available for remote collaboration only and am not open to relocation.
I work under employment contracts governed by the Russian Labour Code, civil-law services contracts (GPH), employment contracts governed by the Georgian Labour Code, or as an individual entrepreneur registered in Georgia.