Q&A - What is revenue?

A business exists to provide products (goods and services). Those products are sold to customers.  When a customer buys a product, that transaction becomes a sale for the business.  That’s what businesses do – they make sales. The value of sales made is the revenue of the business.

You will come across some different ways of describing sales. Alternative terms for “sales” include:

- Revenue (the official accounting term)
- Income
- Sales turnover
- Takings (often used by retailers)

So we know that sales arise through the trading activities of a business. How are sales measured? 

The value of revenue in a given period is a function of the quantity of product sold multiplied by the price that customers paid.  Total revenue can be calculated by this formula:

Total revenue = volume sold x average selling price

A business that wants to increase revenue needs to either:

(a) Increase the amount or volume sold (higher quantity),

(b) Achieve a higher selling price,

Or (ideally) both of the above!

Revision Presentation - Marketing Mix: Introduction to Pricing [17 May 2012]
Revision Presentation - Calculating and Measuring Profit [13 May 2012]
Pampering - demand booms as consumers seek an affordable treat [4 Mar 2012]
Revision Presentation - Workforce Planning [26 Dec 2011]
Time for this Dragon to Cut Costs to Keep his Health Clubs Fighting Fit [11 Dec 2011]
Empty Shelves at Sainsbury’s - You Decide! [27 Nov 2011]
The Rise and Fall and Rise of Gerald Ratner [27 Nov 2011]
Cut price cup cake deal goes wrong…... [22 Nov 2011]
Revision Quiz - Costs, Revenues and Profits [12 Oct 2011]
Lesson Worksheet - Business Costs [12 Oct 2011]
Virtual shopping - Tesco in South Korea [6 Oct 2011]
Product Life Cycle - The Blue Peter Annual [22 Sep 2011]
An end to outsourcing? [18 May 2011]
Football in numbers - lesson activity [19 Apr 2011]
Kate & Wills - A Short-term boost to demand [9 Apr 2011]
Protection for the endangered pasty [23 Feb 2011]
Revision games - Marketing Basics (True / False) [16 Feb 2011]
Commodity prices in action - soaring Copper [6 Feb 2011]
Retail Meets Monopoly - A Business Lesson Cracker [5 Jan 2011]
Q&A - Distinguish between price and cost [2 Jan 2011]
Q&A - Should a business use a “loss leader” as part of its pricing tactics? [31 Dec 2010]
2011 - A chance for retailers to slip in some sneeky price rises? [14 Dec 2010]
Business Pricing Tactics Under Scrutiny [12 Dec 2010]
Dominos Pizza - Growth & Strategy (Part 1) - Driving Competitive Advantage [26 Nov 2010]
Segmentation & Pricing - the Ice-Cream Price Pyramid [17 Nov 2010]
Effective staff training - a cracking example [13 Nov 2010]
Cash flow Clue-doh! The Mystery is Revealed… [2 Nov 2010]
Profits up at Amazon - but so are costs [22 Oct 2010]
Making the FT Brand Sweat! [19 Oct 2010]
Analysing the Business Data - Marriage in Decline [19 Oct 2010]
Who ate all the pies? [17 Sep 2010]
Pricing Strategy - Mobile Data Networks [14 Sep 2010]
Strategy in Action - Crocs Comes Back from the Dead [4 Sep 2010]
Lost in translation - demand from public sector to dry up? [4 Aug 2010]
Nissan profits from a recovery in demand [30 Jul 2010]
Farmers v Supermarkets - the battle continues [19 Jul 2010]
Demand for Foreign Holidays Takes a Sharp Dip [14 Jul 2010]
Lessons from the business model of King & Allen [13 Jul 2010]
World Cup 2010 Business Winners and Losers [13 Jul 2010]
Emerging from Recession - Manufacturing Leads the Way [1 Jun 2010]
The dangers of focus on one product [9 May 2010]
Corus chief calls for more government funds for the economy [8 Apr 2010]
BUSS4 Research - a Corus of Disapproval [1 Mar 2010]
Managing a recruitment business through the recession [16 Feb 2010]
Taking Demand-based Pricing To Extremes [8 Feb 2010]
Video case study - substitute goods benefiting from the recession [1 Feb 2010]
Strategy in a recession - Fusion Systems [1 Feb 2010]
Business priorities in a recession [1 Feb 2010]
What business students can learn from how businesses have handled the recession [1 Feb 2010]
Demand and Supply in Sction - Haggis [25 Jan 2010]
Market Shares and Chocolate - a Cool IWB Resource [20 Jan 2010]
Product, pricing and profitability in a changing market [20 Jan 2010]
Flight to value has its impact on the Charity Shops [12 Jan 2010]
Retailer performance - interactive resource [12 Jan 2010]
Revision Presentation - Revenues and Demand [30 Dec 2009]
Q&A - When is it appropriate for a firm to use penetration pricing? [21 Dec 2009]
Q&A - Explain price skimming [21 Dec 2009]
Q&A - What is the difference between pricing strategies & tactics? [21 Dec 2009]
Q&A - Explain what is meant by price positioning [21 Dec 2009]
Q&A - What factors should a business consider when setting its prices? [19 Dec 2009]
Q&A - How does pricing link to the objectives of a business? [19 Dec 2009]
Q&A - What is price and why is it so important in the marketing mix? [19 Dec 2009]
Amazon to move onto the High Street? [8 Dec 2009]
Video Case Study - Luxury Sound Maker Ditches CDs [4 Dec 2009]
Outdoor Ice-skating heads firmly down the product life cycle [3 Dec 2009]
A tale of two bakers [16 Nov 2009]
Emerging markets drive demand for oil [16 Nov 2009]
Survive and prosper - emerging markets in the global recession [5 Nov 2009]
Emerging Markets - China’s Growth in Charts [5 Nov 2009]
Halloween - packed full of business studies lesson ideas [3 Nov 2009]
Santa goes back to basics in attempt to reduce the cost of Christmas [29 Oct 2009]
Q&A - How are businesses affected by unemployment? [27 Oct 2009]
Q&A - What are the main causes of unemployment? [27 Oct 2009]
Q&A - Explain what unemployment is and how it is measured [27 Oct 2009]
Managing Cash Flow - Beware the Economic Recovery [26 Oct 2009]
Video Case Study - The Supermarket Bullies? [20 Oct 2009]
Pricing strategies and tactics under investigation [15 Oct 2009]
Dyson launches a new premium product [14 Oct 2009]
Ukraine 1 England 0 - A match to remember? [12 Oct 2009]
Napster - Trying to compete, or getting desperate? [9 Oct 2009]
V-Water - from start up to exit [4 Oct 2009]
Strictly and X-Factor Drive Demand for Pizza [1 Oct 2009]
The lights go out for the nightclub market [26 Sep 2009]
A textbook example of how rising unemployment affects demand [23 Sep 2009]
Providing What Customers Want? [16 Sep 2009]
Demand is booming for UK Cinemas [16 Sep 2009]
The tills are alive with the sound of Woolies [3 Sep 2009]
Video case study: battling for survival in the restaurant trade [31 Aug 2009]
Sony cuts the PS3 price to extend its life cycle [30 Aug 2009]
A dramatic fall in business investment [27 Aug 2009]
More trouble in the skies [27 Aug 2009]
Strategic business decision-making - Network Rail [26 Aug 2009]
Sainsbury’s and Diageo pitch in to battle [17 Aug 2009]
Own label brands profit from the recession [4 Aug 2009]
Demand and supply in action - tea prices surge [4 Aug 2009]
When the Steel Town Boomed [3 Aug 2009]
The Death of Newspapers - to be replaced by Nichepapers? [2 Aug 2009]
BA cuts out the cost of short-haul meals [29 Jul 2009]
One-handed eating changes the demand for knives [20 Jul 2009]
Starter Activities - UK Retailers [9 Jul 2009]

BUSINESS TEACHER RESOURCE NEWSLETTER
Get first news of business teaching resources, ideas and other materials from tutor2u. Over 9,400 business teachers from the UK and around the world receive our regular teacher email newsletters. Sign up for free here!