Which of the following is an example of revenue synergy?

Get ready for finance interviews with technical questions. Use our quiz with multiple choice questions, hints, and explanations. Boost your confidence for your finance job interview!

Revenue synergy refers to the potential increase in revenue that can be achieved through strategic business initiatives, often following a merger or acquisition. It focuses on how the combined entity can generate more sales or enhance revenue streams than the individual companies could achieve separately.

In this context, cross-selling products between companies is a prime example of revenue synergy. When two businesses merge or collaborate, they can leverage each other's customer bases to sell additional products or services that complement one another. For instance, if Company A specializes in software and Company B provides hardware, they can cross-sell each other’s products—Company A can offer the hardware to its customers, while Company B can offer the software, thereby increasing sales and enhancing revenue for both.

The other options relate more to cost savings or operational efficiencies rather than directly enhancing revenues. Eliminating redundant facilities and improving operational efficiency focus on reducing costs, while reducing professional service fees also targets expenditure rather than increasing sales or revenue. Therefore, these elements do not exemplify revenue synergy in the same way that cross-selling does, which directly aims at augmenting sales and market reach through the collaboration of two companies.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy