To raise EBITDA, which of the following strategies is effective?

Study for the DISS Fundamental Analyst Exam. Enhance your skills with multiple choice questions and detailed explanations. Prepare thoroughly and achieve success!

Raising EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is a key goal for businesses, as it reflects operational performance and cash flow. Growing the customer base is an effective strategy for increasing EBITDA because it typically leads to higher revenue generation. When a business successfully attracts more customers, it can increase sales volumes, and if managed correctly, this can enhance profitability without a proportionate increase in costs.

Broadening the customer base also provides scalability opportunities, potentially leading to economies of scale where fixed costs are distributed over a larger sales volume. Moreover, with more customers, there may be potential for cross-selling and upselling, further contributing to revenue growth. In summary, expanding the customer base is a proactive approach to driving top-line growth, which in turn supports an increase in EBITDA.

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