How to calculate Weighted average SAM or weighted average SMV ?

Whenever there is a need to find the average SAM, It becomes quite clear that simple average doesn’t give us the right picture. This is because simple average divides the SAM equally between all the styles. This division is wrong because there will be some styles with bigger order Quantity and some styles with lesser order quantity and the effect of order quantity will not be reflected in the averaged SAM. Therefore we need to calculate weighted average SAM whenever there is need to find average. Continue reading “How to calculate Weighted average SAM or weighted average SMV ?”