Unit Economics
The revenue and direct costs associated with one unit such as a customer order or subscription.
Plain English
Does each customer or transaction make economic sense?
In context
Unit economics reveal whether growth improves or worsens the underlying business before fixed costs.
Example
“We need positive unit economics before scaling acquisition.”
When you'll hear this
- pricing
- growth strategy
- business review
Common misunderstanding
Positive contribution per unit does not by itself mean the whole company is profitable.
Commonly used by
Related terms
Updated: 2026-08-25
