Repost: Does anyone know revenue growth expectations??? Help

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cafebonafide

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Jan 8, 2005
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Bend, Oregon
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Year to year comparison, same store sales...yes.

Thanks for that clarification, yes that is what I am looking for. Thanks!
jcd
 

ElPugDiablo

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Jul 16, 2004
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Hartford and New Haven, CT
First thing first, there are a few ways to increase revenues from one year to next; you can increase traffic without decrease your prices to your store (grow your market share), you can increase your average selling price by increase menu prices or you can up sell your customers. Obviously the best growth is from increase in volume. However that is the hardest to come by. Historically speaking, better managed retail stores in the U.S. that are in operation for more than a year can sustain a 3% to 4% year over year same store revenues growth by a combination of a small volume growth, better product mix, and a small price increase. If you can do this year in and year out, you are doing pretty well.

If you are writing a business plan for a new shop, and are doing projection. Assuming you put in a conservative figure to reflect a low first year expectation, you might want to use anything between 30% and 50% growth from the first year to second year. This is rather arbitrary, subject to local competition, how fast news of your new shop spread, not to mention if the locals were impressed with your operation. For example, let’s say you totally blown people away, or you are the only game in town, then it is not unreasonable to see a 50% growth from your first year’s figure. However, while you should be full of confidence, if you cannot justify a high number, then the credibility of your business plan is going to be questioned. Also, this is high growth rate is applicable from year one to year two only. From year two to year three, assuming no change in business environment, you should figure a growth of no more than your local economic growth plus whatever pricing adjustment you plan to make.
 

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