Sales Definition – Meaning and Examples

sales definition

Sales Definition with Example

Sales Definition – “An exchange of goods and services for money”.

In general terms, sales is a mechanism where exchange of products and services takes place between buyers and sellers for a price. You can also say, it is a contract or agreement between a buyer and a seller. In exchange of a money, seller transfers the asset to the buyer. It is necessary that both parties are in commitment of fulfilling the sales contract. In addition to this, seller has the right to transfer the property in the name of the buyer.

So, the transfer or exchange is regarded as sale only if, one person transfers something and in return gets money. However, if in return the person didn’t get anything in return, then it is treated as either a gift or a donation.

Examples of Sales

Case 1 – A is a shopkeeper who sells various types of fruits say orange, pineapple, apple , mango, etc. B is a supplier of fruits. Now its the summer season and A needs fruits. He contacts B to provide him 50 kg of variants of fruits for a price of say 2,000.

Case 2 – A needs fifty kilo of fruits to meet the demand. However, his wife got 30 kg of fruits from her maternal home. And he decide to buy rest from the supplier.

Analysis

The first case represents the example of pure sales. However the thirty kilos of fruits that A receives from his wife’s home is not sale at all. This is a gift.

Difference between Sales and Marketing

Sales  Marketing
Exchange of product or service between two parties for a price It is the planning, implementation and control of business activities to bring desired parties at one place
Main objective is to fulfill the demand of the customersIt focuses on not only selling a product but customer relationship, assess needs, etc
Fulfills sales volumeIt promote, produce, price product and services
Short termLong term
It applies push strategyIt goes for pull strategy

Related Financial Terms of Sales

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