sales and business valuation
Definition : Sales
The turnover, also called CA, is defined as the sum of sales of goods or services of a company over an accounting period. It is calculated as follows: CA = sales price * quantity sold.
How to optimize your turnover?
The turnover includes 3 elements: price, volume and number of offers. To increase your turnover, you must increase one of the 3 components. The increase in the number of offers corresponds to the increase in the number of customers. To do this, it is necessary to either propose means to retain customers or to use advertising and communication to attract them. To increase the volume and the prices, you have to find the right balance by playing on discounts when a customer buys in large volume, or by increasing the prices.
Turnover and company valuation are linked. The turnover is one of the most important indicators to study when applying for financing from a bank (as for a fund raising for example) or when valuing a company.
If you would like to know more about the use of turnover in your company's sector of activity, do not hesitate to contact one of our experts: contact a XVAL consultant
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