Financial Forecasts – Will You Make Money?

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The financial forecasts in your business plan are your view, your best educated guess, of what the finances of your business will be in the future based on the plan you have produced.

Prove to yourself your business will make money.

Sales Forecast – estimate the revenue you expect to earn from sales in the next 12 months and the following two years.

Profit & Loss Forecast – estimate the amount of profit you expect to make, calculated by taking the value of your expected sales and subtracting both the variable costs (the costs of providing those sales) and your fixed costs.

Cash flow Forecast – calculate the monthly flow of cash (when the cash is actually paid and received) and the monthly cash balance.

You may also need a Projected Balance Sheet to forecast your net worth based on your assets and liabilities.

Here are simple examples of a Profit and Loss forecast and a Cash flow forecast layout, for illustrative purposes. Each set of forecasts will be unique to each business.

Profit and Loss and Cash Flow Forecast

Develop the financial forecasts suitable for your business – it will give you visibility of your finances and help with decision making. Please contact me if you have any questions or would like further support.

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