A revenue analyst is a special type of accountant who keeps track of a company’s revenue and looks for ways to improve it. This analysis is multifaceted. The revenue analyst tracks revenue over time and determines the direction of the trend. He determines how a company’s revenue compares to competitors in the industry. The analyst breaks down revenue by individual product and service and determines which goods are making the company money and which are not. He matches revenues to expenses for each business segment to determine the relative profitability of each segment. A revenue analyst must possess an almost preternatural attention to detail and be highly accurate with his work.
Key Takeaways
- Revenue analysts are similar to accountants.
- A revenue analyst is responsible for managing a company’s revenue and helping make business decisions to improve it.
- Revenue analysts should be comfortable with math.
Revenue Analyst Job Duties
Revenue analysts are responsible for taking large sets of numerical data and extracting from them valuable information about the company’s revenue that management can use to make business decisions. The amount of specialization for a revenue analyst varies from position to position, with large companies often employing more specialized analysts and smaller companies hiring fewer analysts but training them on the entire breadth of the field.
Some revenue analysts take a micro approach to analyzing data. In other words, they draw conclusions from examining strictly company data. Their reports are minimally influenced by external forces or broader economic data. For this type of revenue analyst, common job duties include matching revenues to expenses for various business segments; tracking the revenues of a company product or service, or for the company as a whole, over time and charting the trend; and brainstorming potential ways to increase revenue without affecting a concomitant increase in expenses.
For example, a revenue analyst tasked with examining internal data for a retail operation might track revenue over time for various products. Additionally, he might match revenues to expenses to determine the relative profitability of each product. Beyond number crunching and ascertaining trends and profit margins, a revenue analyst must also be capable of taking the information he has uncovered and formatting it into financial reports that are easy to read and easy to understand. After all, it is the members of the company management team, many of whom do not have the strong math or accounting background of a revenue analyst, and who rely on the data to make business decisions. The revenue analyst offers valuable information derived from often-complex quantitative analysis, but he must present this information to his superiors in a way that makes sense to a layperson.
Other revenue analysts incorporate macro data into their analyses. Apart from internal data, these analysts draw conclusions based on economic data from outside the company, such as industry trends, competitor data, and economic indicators. For example, without looking at external data, it can be easy to falsely conclude that a slight downward trend in revenue results from poor management or misguided business decisions. One duty of a revenue analyst is to control for external factors when examining data. Therefore, if a slight drop in revenue coincides with an even larger drop in broader economic indicators, an alternative and likely more accurate conclusion is that management is doing just fine; it is mitigating losses in the face of a challenging economy.
Skills
Revenue analysis is a challenging job that is highly rewarding for those who possess the right skill set. A revenue analyst is a type of accountant. Like all accountants, revenue analysts should be good with numbers. For most positions in the industry, advanced math skills, such as high-level calculus, are not required. However, a revenue analyst should be quantitatively inclined and in no way intimidated by math.
Attention to detail is paramount for a revenue analyst. The job entails working with large data sets and it is easy to get confused. Even tiny mistakes in the analysis process can lead to misguided conclusions, which render an analyst’s financial reports inaccurate. This can result in management making bad decisions based on faulty data.
Though accountants carry a stereotype of introversion and solitude, people skills are vital for a revenue analyst. Most of them work in teams. They eventually come together to compile their findings into one unified report, particularly at large companies where revenue analysts specialize. Moreover, a common career path for a revenue analyst is to start as a team member and then be promoted to team leader. Even with strong technical skills and numerical proficiency, making that jump is difficult without good people skills.
Education Required
While no rigid educational requirements exist for revenue analysts, most companies hiring for the position want to see at least a bachelor’s degree, preferably in accounting, finance, economics or statistics. In the modern job market, revenue analysts without college degrees are few and far between; graduating college should be viewed as a de facto requirement.
Many companies, particularly large firms, prefer to hire certified public accountants (CPAs) for revenue analyst positions. Becoming a CPA requires minimum education hours, passing an exam and then working under an existing CPA for a period of time. To take the exam, a candidate must first complete 150 hours of postsecondary education. This is more than a bachelor’s degree but just short of a master’s degree. Firms often hire revenue analysts who have completed the required education but who have not taken the exam, under the contingency, they complete the exam within a certain period, usually one year, of their hire date. These professionals are known as CPA candidates since their education qualifies them to take the steps to become CPAs.
Average Salary
Revenue analysts make an average of $66,341 per year. Someone new to the field can expect to earn between $49,000 and $88,000. Where an employee fits in this range depends on several factors, including geographic location, company size, and individual performance. Beyond the pay, another benefit to this career is nearly unlimited upward mobility. Revenue analysts regularly get promoted to revenue manager, controller, vice president and even chief financial officer (CFO). Revenue analysts also report high levels of job satisfaction. They tend to work reasonable hours and enjoy generous benefits, such as health care coverage and paid time off.
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