 Based on my experience with small- and medium-sized business owners, forecasting your business is likely the LAST thing you want to do. Your eyes glaze over. You can think of (and do) almost a dozen things you'd rather being doing. I know -- I used to be you.
Building a blueprint for your business -- your forecast -- is actually the FIRST thing you should be sure is in place for your upcoming fiscal year. It is a tremendous tool for:
1. Forecasting helps create a gameplan for your company operations. As you get better at forecasting, you'll add targets for almost every key indicator you can measure. You'll do it because you'll learn that if you can target and measure it (i.e. benchmarking), you can make it happen.
2. Forecasting helps you focus your efforts. Perhaps the biggest challenge a business owner faces is deciding what they're NOT going to do. Entrepreneurs who are "actively focused" are generally the most successful.
3. Forecasting helps you turn problems into successes. You'll lay out your annual forecast month-by-month. After reviewing your results ("how we did"), you'll not only see where you excelled, but also where you fell short. After reviewing trends, you'll be able to easily see where things just aren't happening, fix the problem or refocus your efforts elsewhere. See #2 above. Dale Carnegie offered, "The successful man will profit from his mistakes and try again in a different way."
4. Forecasting helps you increase profits. "A vision without a plan is a hallucination." You can't consistently hit something if you're blindfolded. If you want to double your profits this year, I GUARANTEE you'll have the highest possibility for making it happen if you'll lay out your gameplan (forecast), execute and adjust appropriately.
The bottom line: If you want to Fire, Fire, Fire, forget your forecast. If you want to Win, Win, Win, do what the "big dogs" do -- Ready, Aim, FIRE!
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