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CSA Research's 13th annual market study sizes the language services industry and calculates a variety of business measures. One is the growth rate for the industry overall, another is the performance of hundreds of individual suppliers that provide detailed revenue data to our survey (see figure). In this year's analysis, we estimated that the market will turn over US$43.08 billion in 2017, a rise of 6.97% over the last year. You can download a description of our quantitative research and analysis methodology. We found that the 100 largest providers in our sample outperformed the overall market by 39% while the lower half of that list (those ranked 51 to 100) beat the average growth of the top 100 by 62%. Year after year, our data-based research shows that smaller firms typically grow faster than the largest ones. This year is no different, although some larger firms logged greater-than-average increases in revenue.
Besides the 100 largest, another 81 firms appeared within the annual nine regional rankings. We systematically review all companies on our 10 lists to determine which grew the most. In our "Fastest-Growing LSPs: 2017" report, we present two lists of the fastest-growing companies - the 20 that grew the most from 2015 to 2016 and the 20 that experienced the highest compound annual growth (CAGR) over the prior three years. In both cases, we compared increases in the currency in which respondents reported their turnover. By eliminating the FOREX factor, we showcase real growth in revenue that would otherwise get lost in the conversion to U.S. dollars that we use for comparisons and market sizing. The full report identifies the major growth factors and provides more detailed information about the companies on the two lists. Our two lists of fastest-growing companies represent a broad range of revenue, capabilities, and geographies. They offer language services and in some cases technology, but each has its unique combination of messaging, offerings, size, geography, and other attributes. The following two tables list the top five companies in simple growth from 2015 to 2016 and in compound growth from 2014 to 2016, respectively.
What caused these companies to grow so much more than the global average?
Which measure – year-over-year or CAGR – should you pay more attention to? The CAGR presents a more realistic view of growth on an annualized basis than a single-year increase. Owners, acquirers, and investors measure sustained performance using the three-year CAGR, viewing it as an indicator of future execution. When they combine CAGR with operating profitability as measured by EBIDTA (that is, earnings before interest, tax, depreciation, and amortization), they gain objective and meaningful metrics to assess performance and more insight into which companies would be desirable acquisitions.
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