Think forecasting for the year ahead is a waste of time and effort? Consider these four advantages before you knock it

Simangele Mzizi, Fsp Business, 07 Nov. 2014

Tags: forecasting, excel, advantages of forecasting

As the year draws to a close, business owners use this time to forecast for the year ahead.

But there are some business owners who believe forecasting is a waste of time and effort. They say it’s never completely accurate. As a result, they don’t bother doing it.

If you hold a similar view, we urge you to take the time to consider the following four advantages of forecasting for the year ahead before you dismiss it.

Revealed: Four advantages of forecasting for the year ahead

Advantage #1: Forecasting helps you predict the future for your business
While forecasting for the year ahead doesn’t provide you with a crystal ball to see exactly what will happen to the market and your company over the coming year, it will help give you a general idea.
This, according to, will provide you with a sense of direction and allow your company to get the most out of the marketplace.

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Advantage #2: Forecasting keeps your customers happy
To keep your customers satisfied, you need to give them a product they want when they want it. This advantage of forecasting in business will help predict product demand so that enough product is available to fulfill customer orders, says the site.
Advantage #3: Forecasting helps you learn from the past
When it comes to recruiting job candidates, we always say, “the best predictor of future performance is past performance.”
This view applies when it comes to forecasting.
Looking at what happened in the past can help your company predict what will happen in the future. Thus making your company stronger and more profitable.

Advantage #4: Forecasting helps you prepare for new business
By forecasting demand, your company can see if an increase in sales is imminent. This allows you to prepare for this increase in business by providing extra staff or production facilities to meet this new level of demand, says the site.
While we’re not saying forecasting is 100% accurate, it will help your company to look at the bigger picture, stay ahead of the competition, plan in advance and help you improve your bottom line.
If you’ve been swayed by these advantages and want to get started, use Excel to do your forecast for the year ahead. If you’re not familiar with this programme or don’t know how to navigate through it, check out the Excel Training DVD 2014: Solutions to Your 35 Biggest Excel Finance Problems.

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