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Best Practice

CAGRs Made Easy

CAGRs – compound annual growth rates – are commonly displayed with histographs. There are good ways to display CAGRs and not-so-good ways. The best way we've seen is shown below. The CAGR lines are out of the way of the main part of the chart, so they don't interfere with the primary data being displayed.

Don't be afraid to manipulate the column layout in the chart worksheet. In the case below, the CAGR is shown for only 3 months. The remaining two months are estimated figures, so they are not included in the CAGR. To create the space between the actual and estimated columns, simply add a row between 2008 and 2009 in the worksheet (make sure it is active).

You can use the same methods with different chart types. Below are a bar chart and line chart with the CAGRs displayed.

Calculating CAGRs doesn't have to be difficult. There is a add-in utility for Excel that makes the calculation quick and easy. Visit the Exel-lent Marketing Formulas site to download their free trial. The download has many other formulas as well. Good find. If you want to buy the add-in, it's only $29.95.