Forecasting to help with planning

As we all know, there is more to growing a business than simply increasing sales. There are choices to make about staffing, premises, insurance policies, the list goes on.

Written by BW Bookkeeping and Project Solutions - Fri 25th Jun 2021

bookkeeping and business development services

Sitting and having a look at your figures from the past couple of years, and working out what will probably happen to your costs as the sales increase is the first step in basic forecasting. So for example, if you have 30% higher sales next year, what will happen to your staff costs and will you need to pay additional rent?

It takes a little time to work through a forecast, but not only will it help you feel prepared it will also give you targets to work to.  All business experts will tell you that if you start to give yourself a monthly target to aim towards, you will start to see an increase in your turnover.  If you start to measure your performance against a tartget you want to hit, there is an incentive to make the changes needed to grow.

Hitting increased turnover targets and monitoring your costs so that you know if the figures are in line with the forecast or not are two great steps towards not just growing the business, but making sure you are growing the profits at the same time.

Afterall none of us are aiming to grow the sales and end up with a smaller profit in the long term.

BW Bookkeeping and Project Solutions Ltd.

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jen@bwbps.co.uk

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