[Closed] forecasting figures for a business plan

Just make em up. - Tell people what they want to hear.

wouldn't that be nice

Past performance and trends. Market research for size of market, expected growth, new products etc

Nobody believes them anyway so might as well project the higher end of your hopes. make sure you factor in the infrastructure needed to support them.

I usually think the "human scale/cascade" approach is convincing. i.e. "I will have 3 sales guys who can each make 30 calls a day, out of them, 2 will result in an appointment; 35% of appointments result in a prospect; 20% of prospects result in a sale; average value of a sale is £X. Each sale cost us £Y to fulfil."

That tends to get people nodding in agreement.

[quote=marcus ]Just make em up. - Tell people what they want to hear.

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Just make em up. - Tell people what they want to hear.

Having done funding presentations to VCs, this is basically it.

Step 1, make up impressive sounding numbers, step 2, try and find something to back them up...

If you don't have big numbers and the mandatory hockey stick growth curve, you won't get funding.

I once put together a very pessimistic business plan to some VCs. They said it was refreshing to see an honest business plan for a change and I got the funding.

marcus - Member
Just make em up. - Tell people what they want to hear.

POSTED 1 HOUR AGO # REPORT-POST

In the end, basically, this. Many large organisations go through very, seemingly, detailed scenarios and factor in all sorts of trending and future expectations to generate things that management consultants like to call 'deltas' - that's 'changes' to those not charging in excess of a grand a day.

The tyres get kicked, the scenarios get modelled, the 'overlays' get applied until.......you arrive at the number the CEO thinks will keep stakeholders happy, or if you're really unlucky, the number he or she has already promised to someone.

Countless times I have provided detailed models with clear assumptions and detailed findings and been told "just make that number x and that one y and we should be close to what we need".

The trick is to keep a copy of your unbutchered model for later, when the actual results come in. 8)

Are the figures for you, in deciding whether to gamble your life savings or not?

Or are they to attract investors etc?

One might be more optimistic than the other depending on your outlook.

In either case, you might want to look at best and worst case sales/growth. I.e. how much to break even and make a modest profit. And if you achieve or exceed your upper target, how will you grow your business to keep up?

With any business plan though, I think if you spend too long on it, it might never happen! At some point you have to take a leap into the unknown.

things that management consultants like to call 'deltas' - that's 'changes' to those not charging in excess of a grand a day.