Financial Growth Rate Percentages: Determining your Annual Growth Rate

Matthew Warner 

Psytext 

          Your business growth rate percentage will determine how much your revenue will grow on a monthly, or annual basis. When done correctly, this can be broken down into a percentage rate value. This document will discuss the different methods used to find out your specific growth rate percentage value, and determine your own unique values as a whole. 

The first thing that needs to be done is determine how much your current revenue is, you can then look up similar information that is associated with the same industries, or similar companies. There will be a detailed list that explains what each group has earned or lost during which year. These are also based on what has been reported to the government. After calculating these numbers, you need to also take into account the other outside influences.

1. What is your Growth Rate Percentage?

          Growth rates are what your average revenue is against your expenses in relation to the exterior business environment. Depending on the industry you work in, there are several different mitigating factors that may or may not affect how your company can and will operate. Some of these may be associated with your ability to reach your audience, and others maybe based other forms of outside changes. Once you have isolated all of the details that will affect your company's ability to generate profit, you'll be able to find out which ones that you are going to be most susceptible to.

          This will be related to your own industry trends, and what has been published by Statistics Canada or other analytical information gathering websites. In many cases, when you already have a business plan, you will be required to produce a financial strategy that demonstrates your four to five year annual projections. Your growth percentage rate will be included in this information. When done correctly, your growth rate percentage will be broken down into a positive or negative percentage value.

Contact us today to have your financial details created, based on your business profile. To get started developing your business plan, financial statement or any other documents; click on the link below. 

          There are companies that provide information for free, and they can be accessed easily online. They publish only relevant data that has been acquired from registered business, and they are usually government accredited organizations. One of the most used, respected and viable companies that provide this information is Stats, or Statistics Canada.

2. Stats Canada

          This website highlights the current industry trends that have been publicized from the recorded data sent when companies, small businesses and entrepreneurs file their tax statements. It is a compiled resource of information that includes all of the recorded details that are associated with that industry. They provide a very straightforward interface, and will allow you to research specific documentation that can go back to as far as when the business was first established. This is a reliable resource, and is one of the tools used to determine your financial growth percentage rate. This website not only features factual and relevant data based on numerical percentages that have been legal reported, but provides insight toward social trends, and changes to the landscape and urban environment. Some of these may effect different industries, and in some cases are specifically designed to do exactly that. Building businesses in areas that are supposed to be receiving growth, or other forms of positive environmental support will help investors forecast the best and most lucrative ways of conducting future operations.

3. Understand Your Potential Customers

          There are many different ways you can learn about your potential clients, or customers. The first thing you need to do is conduct your own form of market research. This can be based on the type of industry, or business that you are opening or running, in conjunction with what you already know. Other than that, you can use surveys, marketing letters and other ways to find out specifically what your audience needs, wants or is willing to purchase. If your business has been built on something that has been a traditional faucet in the community, finding ways to integrate new technology towards implementing its popularity is something worth looking into.

          Social media, and other forms of free online networking are very lucrative ways for companies to share information, connect with others and have fun doing so. Doing your own personal demographic research, in conjunction with your own psychological analysis will provide you with the basic details that you need for finding out what your clients are going to be most interested in. It will also help determine how much they are willing to spend, and how often they're willing to do so. Some of this data is also included in statistical reports that are published on stats Canada.

4. Environmental 

          Environmental changes will directly effect your company's ability to obtain the necessary equipment, or maintain general operational procedures. This is not only associated with the companies that provide products, but also companies and businesses that provide services. Services will be affected by environmental changes by limiting the service providers ability to obtain stock and materials, reach their clients, or make it to off-sight locations. Other outside influences that will hinder service providers from making it to off-site locations will be lack of access. Lack of access, can be caused from massive amounts of snowfall, large amounts of traffic, inability to purchase fuel, inability to physically travel for legal restrictions, or the inability to be able to operate for health and safety purposes.

         Weather influxes can greatly affect your ability to reach your potential clients, and customers. Natural disasters and other events that are out of human control can and will affect the ability to commute, travel, deliver goods and services, or receive specific ingredients that will require environments that are reliant on favorable conditions. One example would be someone who is working in the agricultural sector. If they are running multiple farms, and have properties that grow specific types of crops that have to be shipped, and or exported. Paying attention to changes in weather differentials and variables is very important. This will help protect farmers from product loss, and will help determine which crops will grow the best during the appropriate season. Otherwise, tens of thousands of dollars can be lost, and profit that could be generated to help others is going to go to waste.

5. Social 

          Social influence plays a crucial role in any company, business and organization. Your main goal is to interact with your clients, customers and audience. This counts for your current and possibly prospective possibilities. Marinating a clear and concise line of communication is crucial. There are several different internal and external factors that may affect how your ability to interact on a social level with your clients comes into play. Monitoring current trends, and how other similar companies are dealing with the current social environment will help you prepare for things that may affect you and your own company. Social influences can also be directly associated to political ideology. For instance, if there are specific tariffs placed on a nation that limits its ability to obtain a certain ingredient that your company needs for production, then the price may be affected, and or your ability to continue making this product may change.

Lifestyle Trends

          Lifestyle changes are one of the major elements that are directly related to social changes. As people make more determining factors that are associated with their health and well-being, they're purchasing patterns will change. A primary example of this would be that of the senior citizen sector in Canada. Many of the senior citizens are now living well past their current life expectancy, and are having more active and enjoyable lives. This opens doors for another segment of the population, and will also provide a fundamental component when determining whether or not to move forward on a project for initiative. Lifestyle trends can also be isolated to varying forms of patterns. Monitoring how each generation affects each other and the time frame between one another, will draw a specific dialogue that will help a business owner create an algorithm that is in their best interest.

6. Emotional

          There are very specific emotional dialogues that are associated with each industry, business and type of corporation. Understanding which one might affect you, your staff, or team members and your clients will help you determine ways around dealing with these mitigating circumstances. Finding ways around these issues before they happen, will allow you to prevent further loss of income due to any form of outside emotional stress.

7. Political

          Legal mandates, tariffs and personal opinions can ultimately effect how your active and potential consumers will purchase. This will alter your ability to generate revenue. How does your industry relate to any form of social or political changes? Have you factored in any of these changes, or take them into account?

8. Forecasting 

          Companies like restaurants have recorded lists of how many clients have interacted with them in the past, and how many sales they've had on a day-to-day basis. This will help them pre-plan, and schedule how many clients, or customers are going to be expected to purchase at that specific time, and date. 

9. Conclusion 

          Understanding your company and exterior environment is crucial to smooth operations procedures, and your own personal enjoyment.

References

https://www150.statcan.gc.ca/n1/daily-quotidien/220209/dq220209b-eng.htm

          Ergete Ferede and Bev Dahlby, "The Effect of Population Aging on Economic Growth in Canada" (2023)

published by: Fraser Institute 

          Warren E. Kalbach, "Population of Canada", (2022)

published by: The Canadian Encyclopedia 

          "Key Small Business Statistics 2022"

https://ised-isde.canada.ca/site/sme-research-statistics/en/key-small-business-statistics/key-small-business-statistics-2022