How to create projections to achieve your goals

My daughter starts her second year of preschool this week. It’s hard to believe the summer has come and gone, and now it’s time to make sure I have adequate school snacks on hand at all times. I hope you had a glorious summer too. Even if you don’t have kids, there’s something in the air that changes when the calendar ticks over to September. Yes, it’s getting cooler but it also feels different, like the world is getting back to business.

Many leaders I know are gearing up for Q4. Our retail clients have their biggest sales months, our nonprofits are in the thick of fundraising, and everyone is putting in a 110% effort to meet their 2019 goals. Does this sound like you?

One thing that I’ve found super helpful as we enter this busy season is mapping out exactly how we’re going to achieve our goals, or forecasting.

You probably (hopefully?) created a budget in the beginning of this year that mapped out revenue and expenses from January through December, but that was a LONG time ago. Likely, you didn’t meet every single budget number for every single month, so forecasting is an opportunity to redo the upcoming months. You have a whole nine months and lots of information under your belt to make even better projections for Q4.

So here’s how to create Q4 projections. Open your budget template (Need one? Grab mine!), your financials for the year, and all your hopes and dreams, and let’s dive in!

How to create Q4 projections:

  1. Look back. Review your financials for the year so far. Compare revenue and expenses to your budget. How did you do? How far off were you and why?
  2. Look back even further. Check out your Q4 financials for last year. That’s often a decent place to start to help anticipate what this Q4 might look like.
  3. Build your projections! And I seriously mean build. Start from the bottom up and create your forecast with building blocks. For my service businesses: How many clients do/will you have? How much do you charge per client/project? How many new clients will you get? For my product businesses: How much did you sell last year? How much new product have you purchased and what are your prices? What’s your advertising budget? For my nonprofits: How much did you raise last year? What big grants or major gifts do you have in the pipeline?
  4. Don’t forget expenses. Often we’re just thinking about the finish line in terms of revenue, but net income or profit (revenue – expenses) is really what we should be aiming for. Build in any and all expenses that you’ll have in Q4 and check out your net income. (Quick reminder to nonprofits: you can have a positive net income even though you’re a nonprofit! That’s how you build a cash reserve and long-term sustainability!)

For my friends out there who hate numbers, this can seem like a useless exercise (But I already created a budget!) BUT it’s truly the only way to stay on top of your goals during what is often the last season of hustle for the year. AND, if you create this forecast now with a clear path of building blocks to achieving your goal, maybe it won’t feel like such a hustle after all.


PS – Feeling a little overwhelmed? I have a template, complete with a video walkthrough, here! Download it for free and get started.