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How is the forecast looking for your business?

August 17th, 2021

Mangesh Naik, Associate CA

Whenever we're going on holiday or have plans for the weekend, we always check the weather forecast so we can plan accordingly.

It’s no different in business. The forecast tells us if there’s bad weather (poor cashflow) in store based on the direction we’re heading.


Your forecast will tell you:


1. If you have enough sales in the pipeline to give you the desired level of profit for the year.

2. Whether your margins are appropriate.

3. If you need to review your pricing or production processes.

4. If your business is running as efficiently as it could be.

5. Where savings can be made.

6. Whether you should invest more to get a better return.

7. How much money you need to set aside for tax.

8. How much money you can draw out of the business each month without running short.

9. How much debt you’ll be able to pay off.

10. Whether or not you'll be able to meet all of the bank’s requirements.

The difference between a business forecast and a weather forecast is that, when the business forecast is showing bad weather, you can do something about it to make the sun come out. The forecast will tell you what’s going well and what’s not, so you can make adjustments to reduce the impact of bad weather.


Just as you wouldn’t go hiking without checking the forecast, you shouldn’t run your business without an annual forecast. So, don’t live in your raincoat, waiting to get soaked - take control and talk to us about getting your forecast done so you know what to expect.

“Planning is bringing the future into the present so that you can do something about it now.” 

Alan Lakein

Mangesh Naik, Associate CA

Lynch & Associates Limited

Email Mangesh Naik

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