Why we always ask clients to group revenue sources

When we forecast a company’s performance, we don’t just apply “sales grow xx%”.

Each revenue stream behaves differently.

Different growth drivers.
Different cost structures.
Different risks.

So instead of projecting total revenue as one line, we break it down:

• Revenue stream 1
• Revenue stream 2
• Revenue stream 3

…and forecast both revenue and cost for each item, based on:

• Historical performance
• Management plans
• Industry outlook

This gives a much more realistic forecast — and a valuation that actually makes sense.

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