Which metric represents the proportion of total sales captured by a company within its market?

Which metric represents the proportion of total sales captured by a company within its market?

• A. ROI
• B. Branding
• C. Market share
• D. Reorder point

Answer: (C)

Market share is the measure of how much of the total market’s sales a single company captures. It’s calculated by dividing the company’s sales by the total sales in the market and expressing the result as a percentage. This directly reflects the proportion of sales the company holds relative to all competitors. For example, if the market's total sales are $100 million and your company sells $25 million, the market share is 25%. ROI looks at profitability relative to investment, not how much of the market's sales you command. Branding relates to awareness and perception, not the actual share of sales within the market. Reorder point is an inventory management metric about when to restock, not market reach. Therefore, market share best represents the proportion of total sales captured.

Market share is the measure of how much of the total market’s sales a single company captures. It’s calculated by dividing the company’s sales by the total sales in the market and expressing the result as a percentage. This directly reflects the proportion of sales the company holds relative to all competitors. For example, if the market's total sales are $100 million and your company sells $25 million, the market share is 25%.

ROI looks at profitability relative to investment, not how much of the market's sales you command. Branding relates to awareness and perception, not the actual share of sales within the market. Reorder point is an inventory management metric about when to restock, not market reach. Therefore, market share best represents the proportion of total sales captured.