This introductory chapter lays the foundation for understanding unit economics. Students will explore the key components of unit economics, including revenue, cost, and profit per unit. They will learn how to define and calculate these metrics, as well as understand their significance in the overall business model. The chapter will also highlight the importance of unit economics in guiding strategic decision-making, resource allocation, and long-term sustainability.

In this chapter, students will delve into the various factors that influence revenue generation at the unit level. They will examine different pricing strategies, such as cost-plus pricing, value-based pricing, and dynamic pricing, and understand how these approaches impact unit-level revenue. Students will also explore the role of customer acquisition channels, customer lifetime value, and churn rate in optimizing revenue per unit.

This chapter focuses on the cost components of unit economics, including fixed costs, variable costs, and the factors that contribute to the overall cost structure. Students will learn how to identify and classify different cost categories, as well as strategies for managing and optimizing these costs. They will also explore techniques for improving operational efficiency, such as process improvements, automation, and supply chain optimization, and understand how these measures can enhance unit-level profitability.

In this chapter, students will delve into the concept of contribution margin, which represents the difference between the revenue per unit and the variable cost per unit. They will learn how to calculate and analyze the contribution margin, and understand its significance in determining the profitability and breakeven point of a business. Additionally, students will explore sensitivity analysis and scenario planning to understand the impact of changes in pricing, costs, and volume on the overall unit economics.

The final chapter of the course focuses on strategies for scaling and growing a business based on strong unit economics. Students will explore various growth models, such as customer acquisition, geographic expansion, and product line extensions, and understand how to assess the impact of these strategies on unit-level profitability. They will also learn about the importance of continuous optimization, experimentation, and data-driven decision-making in sustaining long-term growth and profitability.