Quick Guide to forecasting your Business goals for the year ahead
In this Quick Start Guide we’re going to look at how we can tailor our projections so that they tally with our expectations for the future.
Written by Ross MacLeod
Previously we’ve looked at FUTRLI Last Years’ Actuals method and how easy it is to build a business forecast based upon prior performance. But what happens when you wish to factor in growth? Or a reduction in costs? In this guide we’re going to look at how we can tailor our projections so that they tally with our expectations for the future.
To do so, we’re first going to navigate to the Scenarios section of FUTRLI and select New adjacent to our Organisation of choice. When pressed, this displays the list of Scenario Creation methods available to us. Each method allows us to choose the initial basis for our Scenario. We could build it from scratch or import a budget we’ve made elsewhere. It’s up to us.
Last time we looked at FUTRLI’ Last Years Actuals method and the Quick Create option. Now we’ve mastered that, it’s time to go Advanced. Using Quick Create we simply selected a Scenario Start Date, Length and Name. With Advanced, we also have the opportunity to flex the details. We could set variant VAT rates, apply growth projections or set our expected Credit Terms.
To forecast an increase in Income and a reduction in Costs, we first need to toggle off ‘Every account category’. This will allow us to enter different growth rates for each category rather than applying one for all. We can then simply add a ten percent increase in Income and a two percent reduction in Cost of Sales.
Once happy, it’s time to press Build. FUTRLI will then generate our scenario, looking at our past performance month-by month and factoring in how we expect to vary from that in the future.