Welcome to the FINAL CHAPTER of the forecast month blog series!
You’ve done a lot of work so far around your finances, and I’m so proud of you.
I remember feeling like my business was an intangible, unsolvable puzzle. 🧩
And after I learned about how easy and accessible forecasting was to me, I conquered the scary monster waiting for me in my shoebox of piled-up receipts.
I can’t wait for you to feel the same.
So stick with me here.
Today I want to talk about another thing that you can use to think about when you’re thinking about your forecast.
So far if you followed along, we’ve found out how much our business made this year from January through September. Then we considered any factors that might impact our next three months and change our forecast.
Now it’s time for another factor.
(This tip is mostly for anybody who’s a startup or whose business has grown really fast.)
Predicting Your Average: An Exercise for Every Entrepreneur
If you started out the year making $10,000 a month and ended the year making $40,000 a month, then an average of $10k for October, November, and December isn’t going to make a whole lot of sense, right?
You’re actually making more (way to go, you!) than you were at the beginning of the year, so it’s gotta be part of your prediction.
In fact, you may only want to use, say, the previous three months to determine your average for Oct-Dec, rather than the entire year to date.
The really important thing here is the thing I want to drive home is that this isn’t an accounting exercise; this is a business owner’s exercise.
Don’t voice this one off as an accounting or bookkeeping problem.
As the owner, you want to have a feel for how your business is going to perform, and forecasting gives you the security of seeing any roadblocks ahead of time.
This is the part that makes finance fun.
This is really worth it.
So let’s go ahead and work through this and get you a forecast for this year!
❓ With any questions, please feel free to reach out at https://pamprior.com/ and let’s diagnose your biggest financial headache. ❓