Is 10% a normal growth rate for a business?

Answer 1

If by normal you mean average, this is not a yes or no question. It depends on many things including type of business, competition, capital invested, location, population etc. What is average for one business may not be for another. I'm not sure anything is "normal" in the business world.









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Answer 2

Good question, Mike. The answer, sorry to say, is...it depends. Businesses, taken as a whole, pass through recognized cycles of inception, growth, maturity. Growth is a challenging phase; maturity comes with its own problems, including superceding the original business model in order to remain competitive. The cycles can repeat. You would expect a new business to be small and relatively nimble, and to experience growth rates, if it's successful, to be above average. A mature company would tend to generate returns more in line with the overall market and with other large companies. You didn't specify whether your 10% referred to positive change in revenue, operating margin, return on assets, returns on equity, retained earnings or other, but these are all relevant financial ratios (there are others) that you should look at in comparison with other companies in the same industry as the one you're considering, and in comparison with the same ratios of other industries. You want to do this because the business you're considering is competing with all others, not only those within its own industry, for your money. Hope that's a start.

Answer 3

To answer this question some additional information is needed such as what industry is the business part of, at what stage of maturity is the industry, the business, etc.

A great place to go for this kind of information is www.hoovers.com. the free membership should get you the answer you seek. Just pick by industry or company and let your fingers do the walking. Hope this helps. FYI, Yahoo Finance is great too.