• MARKET REPORT SPECIAL TOPIC •
By using smart technology and automation, manufacturers can capture a significant share of support revenue, allowing suppliers to earn several times the VAR by leveraging these opportunities.
Volume Adjusted Revenue( VAR) is a very useful tool in assessing severe service valve opportunities.
Taxes, Depreciation, and Amortization( EBITDA) than with general service valves.
Even though severe service valves initially represent only 15 % of the total valve market on a total revenue basis, they end up generating an additional 30 % of the total revenue. Since they account for only 15 % of the initial market, severe service valves have the profitability equivalent of 45 % of the market.
The VAR represents a new way to evaluate the potential of valve manufacturing facilities. With smart technology and automation, these suppliers can triple the revenues from this facility.
This is a very useful tool in assessing severe service valve opportunities. Volume Adjusted Revenue is a constant that can assess the variables. As valve companies acquire distributors, there is an increase in both revenues and expenses, but the VAR remains constant. The support revenue opportunity is also assessed as a multiple of VAR.
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• ABOUT THE EXPERT •
Robert McIlvaine founded the McIlvaine Company in 1974 and oversees the work of 30 analysts and researchers. He has a BA degree from Princeton University.