Unit economics

The profitability of a single transaction, customer or store, stripped of everything that does not vary with it.

A meal sold for ₹250 with ₹160 of ingredients and ₹40 of delivery cost earns ₹50 before any rent, salary or marketing.

The reason to work at this level is that it answers the question aggregate financials cannot: does this business get better as it gets bigger, or worse? A positive unit contribution with a loss overall means fixed costs need more volume, which time and growth solve. A negative one means growth is the problem.

The discipline is choosing the unit correctly and then including every cost that genuinely varies with it. Companies define the unit to flatter themselves, and a delivery business that excludes delivery cost from its unit economics has defined the problem away.

Pick the unit, list every variable cost, and let the arithmetic decide.

Does it get better with scale, or worse?