our CEO wants to make a presentation to our largest customer and show them their cumulative growth rate with us over the past 3 years. I have proposed avg Q over Q growth, 3 year CAGR, Growth YOY, etc. I can't get my arms around a way to show a cumulative growth rate that is meaningful. Any advice? Thanks.
Cumulative Growth Rates
Answers
What do you know about their business? Presenting data they have access to won't be very exciting to them.From the client's perspective I would expect they would be looking to see: Are their costs lower because their growth has impacted pricing with volume discounts? Are their costs with you lower than with a competitor? How have your products/services helped their business grow? Can you chart their revenue growth, assumes you have access to published data, next to the growth of their business with you?
If you share with them how partnering with your company has helped them in so many ways you give them information they need to continue to do business with you, move over more business, develop more partnerships/products, or simply to include in their informational material to their C-Suite and Board Members. It is also a great excercise to see if there are other opportunities for your company with this client or others in a similar field, as well as understand your risks with their continued growth.
Great answer Sara, I'd like to add one more set of information.
You are showing that your company is growing. That's great, but with growth comes stress on working capital and adds to the existing fragility of the business.
If I were the client, I'd like to know what is the likelihood that you'll be my vendor not only today, but tomorrow and next year.
Thanks Sara and Wayne. You are absolutely right about the working capital. It is a
Our services have really helped the customer because this is business they would not otherwise have been able to fulfill. I don't think they have considered going to other sources, their basic alternative has been to turn away the business if they can't fulfill it, or outsource it to us and we fill it and they thus grow their business and get some additional margin dollars on it that they would otherwise pass up. They are a large company, so yes they have access to this data but may not fully groc it. So that is really what we are trying to demonstrate to their new
I'm not sure the growth rate does that any better than saying "you have $20M of revenue at 30% margin that you otherwise would have walked away from". But our CEO is really pushing to use a growth rate to help demonstrate this, and I can't figure out a growth rate to use that supports that story. Any further thoughts?
Keep it a simple headline number that is easily understood. My recommendation would be most recent 12 months over preceding 12 months. Our business has grown X% over the last year......