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Eight Key Drivers of Company Value: Growth Potential

November 30, 2020 | By Ryan Abbott

Growth Potential

How big your company could become tomorrow has a lot to do with what someone will pay for it today. Your current growth rate is important and an acquirer also needs to know that your growth rate is sustainable over the long run. One of the best ways you can make that case is to describe all of the potential ways that you can grow your business. For example:

Can you grow geographically?

Are there new markets (e.g. cities, regions, countries) you could enter? Consider new locations where your product or service would sell with minimal tailoring.

Can you grow vertically?

If your existing infrastructure (staff, machinery, office space) could handle more customers without adding too much to your fixed costs, then you have the ability to grow vertically. For instance, a 200-room hotel that averages just 75 guests per night has the potential to grow more than two-fold before its owners would have to make significant investments in infrastructure.

Can you grow horizontally?

Are there other products or services you could add to your offering that would increase the overall value of your business? When considering adding new products or services, ensure that they increase your point of differentiation, rather than diluting it.’

Your Growth Potential is one of eight drivers of your company’s value. Get your score on all eight by completing your Value Builder Questionnaire.

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