“potential value: fact or fiction”

You won´t find it on the balance sheet, but it´s quite possibly the single largest source of potential value. Understanding the customer base is key whether valuing a company for an equity stake or quantifying the synergies from a merger.

• What share does the company have of each en every one of its current customers? What is the potential profit from maximizing customer share?
• What percentage of the customer base is lost, inactive, active, new? What is the average churn vs the acquisition rate?
• What percentage of the market has never been a customer? What potential revenue does these prospects represent? Where are they located?
• How is the company viewed by its customers vs the competition? How loyal are those customers to the company and what is their likelihood to buy again?
• How much of the current revenue and profit base are at risk? Does the company have actionable customer strategies in place?
• Is the current channel structure the most adequate? What is the available increase in profits from optimizing the assignment of customers by usage profile and potential value?
• What is the potential impact of merging a company? How many of target Company A´s customers are already customers of Acquiring company B? Which has the majority share of their business? How complementary are the store/office networks?

Do you truly know the answers to the above questions? If not, we would suggest that you are taking an unnecessary risk with your investment.

Fully understanding the customer base provides significant insight into the future profitability a company. Knowing that a company gained 2000 new customers is interesting but not useful. Are those 2000 new customers mainly small, non-profitable accounts with little to no growth potential or do they provide significant revenue upside? Are they truly new accounts or are they simply ex-customers returning because of aggressive promotional pricing? Could we have captured 4000 instead of the 2000 had we optimized store/office locations?

Successful investing requires accurately quantifying a company´s value both current and potential.

DAEMON QUEST can help remove the uncertainty regarding the many aspects of customer value. Contact us...

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If you´ve already invested Daemon Quest can help you maximize your return. Optimized customer strategies. based upon a detailed understanding of the customer base and then managed through to successful implementation, are the key levers in accelerating a company´s revenue and profit growth.