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Estimate the Total Yearly Revenue Change

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Estimate the Total Yearly Revenue Change

Total Yearly Revenue Change = (Current yearly revenue) x (percentage increase or decrease expected)


Examples

  • Integrating touchless takeout will increase yearly revenue for takeout sales by $8M. ($2M current yearly revenue) x (400%)

  • Retailing secret sauce will introduce a new revenue for retail product sales estimated at $2M.


Tips for Pricing Changes

  • If the Idea involves a pricing change, consider the impact on sales volume. Increasing product price often decreases volume and vice versa.

  • Enter volume and price revenue changes as separate Value Items. 

Example: In order to increase overall sales, you will decrease the price of a popular menu item from $12 to $10. You currently sell 100,000 million units per year. Enter a yearly revenue decrease of $200K per year. ($2 price change x 100,000 units)

But due to the price decrease, you estimate you will sell 100,000 additional units per year at $10 each. Enter a separate yearly revenue increase of $1M. ($10 x 100,000)