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Unit Economics

Also known as unit economics

The profit or loss from a single customer or sale. If each unit loses money, growing faster just loses money faster.

Example

If one customer brings ₹24,000 (LTV) and costs ₹6,000 (CAC), the unit economics work.

Related terms

LTV
The total money you expect to earn from one customer over the whole time they stay with you.
CAC
The average amount you spend to win one new paying customer — all your marketing and sales costs divided by how many customers that money brought in.
Gross Margin
The share of each sale left over after the direct cost of making it — before overheads. Higher margins give you more room to grow.

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