A revenue bridge chart is typically used to understand the contributing factors for a specific revenue goal and explain more granular sales changes from period to period.
Companies can benefit from understanding and tracking their revenue achievement towards an annual goal. The chart below provides a revenue bridge example for the current annual sales goal for a company:
The components/bars for a revenue bridge chart can include multiple data points:
- Existing Revenue: The revenue already recognized by the business.
- Contracted Backlog: Signed contracts the business will need to deliver during the rest of the year, with the highest visibility for those contracts to occur.
- Farming Pipeline: This can include the weighted amount of opportunities from existing customers in the business.
- Hunting Pipeline: Weighted amount for new logo opportunities.
- Go-Get: Gap in revenue needed to achieve the company’s annual goals without a clear direction of where that recognized revenue is coming from at the time of the report creation.
The bars closer to the left are the most secure revenue components, and the bars to the right are the most uncertain revenue sources for that company at that specific point in time. Different companies will include different components in a revenue bridge chart. Of course, the last go-get portion is the one every business should try to shrink to enhance revenue visibility.