Forecast+ has an advanced feature called scenario planning that can help you prepare for different possibilities and turn them into actionable strategies. Here are some examples of how it can help with business decision-making:
Sales Projections: You can explore optimistic, pessimistic, and neutral sales growth scenarios to develop comprehensive strategies. This will help you manage your cash flow and make proactive decisions, no matter how sales are going.
Fundraising Roadmaps: You can create multiple scenarios based on different possible outcomes to establish robust plans for your fundraising events. This ensures your spending, future recruitment, and expansion plans remain resilient and adaptable to the funds raised.
Talent Acquisition: You can simulate the impacts of a high-growth hiring phase under various conditions to see how it would affect your burn rate and runway. This can guide decision-making around hiring scale and pace.
To make things even easier, Forecast+ auto-generates three core scenarios for you:
Base case scenario: This presents a balanced outlook based on recent business trends and performance. It's created using historical data from your chart of accounts over the most recent 3-month period.
Target: This emphasizes a positive future outlook with a projected 5% month-on-month (MoM) increase in revenue and a 5% MoM decrease in expenses and cost of revenue (CoR) over a standard 3-month period.
Worst: This illustrates a potential downturn, with a forecasted 5% MoM decrease in revenue and a 5% MoM increase in expenses and CoR over a common 3-month period.
Scenario | Revenue | Expenses | CoR |
Base Case | 3 months average | 3 months average | 3 months average |
Target Case | 5% MoM increase | 5% MoM decrease | 5% MoM decrease |
Worst Case | 5% MoM decrease | 5% MoM increase | 5% MoM increase |
You can customize these scenarios by renaming them and adding descriptions of the assumptions used in each scenario. In addition, we provide an option for creating a budget scenario.
To modify the names and add descriptions of the predefined three scenarios, navigate to Forecast+ → Settings → Scenarios.
When you click on "Create Budget", an editor will appear on the right side of the screen.
From there, you can give your budget scenario a name and create it.
In the budget scenario, actuals will never be shown, and we will always show 12 months of the budget according to your fiscal year. On the other hand, in the forecast scenario, we will always load the latest month of actuals, resulting in a rolling forecast.
| Budget | Forecast |
Meaning | A financial plan for the year, approved by the board | An estimate of future financial performance |
Purpose | Used for KPIs and setting sales targets | Used for cash flow management and decision-making |
Frequency | Constant for the year | Updated regularly |
Focus | Set in stone | Adaptable to changing circumstances |
This table shows the key differences between budgets and forecasts. Budgets are a financial plan for the year that is approved by the board and used for KPIs and setting sales targets. They are constant for the year and are set in stone. Forecasts, on the other hand, are an estimate of future financial performance that is used for cash flow management and decision-making. They are updated regularly and are adaptable to changing circumstances.
To summarize,
🔮 Forecast+ offers scenario planning for business decision-making. Examples of scenarios include sales projections📈, fundraising roadmaps💰, and talent acquisition👥.
🔑 Three core scenarios are auto-generated: base case☑️, target case🌟, and worst case⚠️
✏️ Scenarios can be customized and a budget scenario💼 is available
💵 Budgets are a financial plan for the year, forecasts are an estimate of future financial performance used for cash flow management and decision-making
🔄 Forecast+ allows for adaptable planning and decision-making
"With Forecast+, you're not just predicting the future; you're planning for it"