Term used in three contexts:
First, to describe the tendency of company sales, particularly in business-to-business sectors to be concentrated at the end of a reporting period, creating a sales revenue graph that is said to resemble a hockey stick laid on its side, i.e., flat for most of the reporting period, but rising rapidly toward the end. The effect is said to arise because of the degree of synchronization of public companies’ reporting periods, e.g., in the U.S., quarterly, beginning January 1st, April 1st, July 1st, and October 1st. The fact that companies have synchronized financial cycles in turn affects their budgeting and ordering calendars, creating a tendency for all to make decisions at the end of each reporting period, which cumulatively gives rise to the hockey stick effect.
Second, used to describe the tendency of sales of certain products to rise rapidly with seasonal demand (e.g., Bar-B-Q’s, Christmas ornaments.)
Third, a discredited term used during the dot-com era in business plans to explain how a company burning money would achieve profitability towards the end of the business plan due to a sudden surge in sales, triggered by a wide array of hypothetical factors, e.g., advertising finally proving persuasive, word of mouth bringing in customers, or late-arriving ‘early-adaptors’ finally adopting the technology. In almost all instances the surge in sales never showed up. Indeed, occasionally the hockey stick turned out to be upside down, e.g., when the promotional budget dried up or initial public interest fell, sales collapsed.