Here’s why this top CEO believes forecasting is the secret to business success

Simangele Mzizi, Fsp Business, 13 Nov. 2014

Tags: business forecasting, forecasting

Business forecasting is one contentious issue.

Some business owners are totally against it because they believe it’s unreliable. Others swear by it and are, in fact, busy with the process as the year draws to a close.

One business owner who approves of forecasting is Jack Stack, the founder and CEO of SRC Holdings (the leading independent remanufacturer of diesel engines and components).

According to Forbes, he’s been a huge proponent of forecasting for 30 years and credits this practice with enabling his company to continue growing through three recessions.

Keep reading to find out why he believes forecasting is the secret to his business success so you can reap the benefits in your business too.

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Forecasting is the secret to business success, says the CEO of SRC Holdings

According to Stack, many businesses seem to get surprised by changes in the marketplace because they don’t take advantage of a forgotten skill: Forecasting.
He says you must never fail to take a bird’s eye view of your business as this can lead to fatal mistakes.
An accurate forecast can help establish measurements to guide management, facilitate planning and goal-setting and create a plan to avoid risks while helping your company meets its goals and milestones.

So how do you do an accurate or effective financial forecast?

According to Stack, to do an effective forecast, you must collect a lot information, both from the past and the future and from a number of diverse sources. He says this will help you make decisions that can help your business thrive in good and bad times.
“Any good forecast should be based on macro-economic projections like fluctuations in interest rates as well as survey information taken from customers and competitors,” says Stack.
Basically, looking ahead will help you prepare your company for road bumps and future success. So take Stack’s advice to heart and do your forecast.

PS: We recommend you use Excel to do your forecast. If you’re not familiar with the programme, check out The Practical Guide to Excel.

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