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The advantage of the percent of sales method is that you have a modeled percentage of previous activity and company growth in terms of creating a marketing budget.

The disadvantage to this method however could be different allocation of internal resources either in growth or decline. This could affect a planned budget and would not be a good way to analyze future expenditures. There are many factors to a business that can affect a marketing budget, and sometimes it makes sense to increase budget percentages to increase growth in sales.

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9y ago

What are the disadvantages of the percent of sales method

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Q: What are the advantages and disadvantages of the percent-of-sales method?
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