Price vs Volume Growth
What would you prefer to see driving a company's top line growth? An increase in the price of the product or an increase in the volume sold?
Trending Content
| +142 | Is my life over after not getting GS? | 33 | 6h | |
| +74 | Best IB group on the Street | 36 | 37m | |
| +66 | Thoughts and tips on how to speak like an investment banker. | 25 | 1d | |
| +58 | BIG FOUR ARE PARADISE | 15 | 1d | |
| +49 | Tell me one good reason why Jefferies isn’t going to be a top bank in the next 5 years | 23 | 1d | |
| +39 | UBS Outlook | 28 | 2d | |
| +35 | How to deal with egotistical team? | 6 | 4d | |
| +26 | Very ridiculous interview feedback | 13 | 17h | |
| +26 | Got RBC offer but I have cold feet accepting. | 34 | 19h | |
| +26 | Why Is It Called Investment Banking? | 8 | 12h |
Career Resources
Not positive, but an increase in volume sold generally indicates an increase in a company's market share, and that's generally a good thing when it comes to growth.
volume
It looks like you can justify a response to this question either way. I'd say it depends on the industry... and your bias. If we are in a high volume, low margin industry, where we are price takers, then an increase in a volume sold would imply either an overall market growth or higher market share captured--something that we like. On the other hand, if we are in a niche environment with high product differentiation and higher margins, an increase in the product price without a significant drop in demand means we are attracting customers presumably because of our products' uniqueness. Since I don't like the idea of a product being a commodity, I would prefer price-driven growth because it would allow us more wiggle room, at least short term, should consumer preferences change (i.e. slash the prices, change product features/services).
Volume, sucka. Hella lucrative. That's what got us here in the first place.
Non aut ut deserunt distinctio corporis. Nihil fugit omnis qui autem cumque sunt. Illo incidunt aut odio maxime cumque nobis. Cupiditate quia quia totam incidunt est ut ipsa. Laborum eos necessitatibus beatae dolor dolor.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...