Projections and forecasts are key to running a business. They enable you to look ahead and make important, strategic decisions in an informed, rather than a reactive, way.
They provide clarity around future performance. Without them, decisions are made with less certainty and fewer reference points.
For secure and sustainable growth, you will benefit from practical, realistic and useful projections and forecasts that will support you in achieving your goals.
Without a forecast, you’re reacting. With one, you’re making decisions with context.
Why do you need projections and forecasts?
Detailed financial projections and forecasts highlight the opportunities and threats in your business with increased clarity and rigour.
With up-to-date, practical data in front of you, spotting where cashflow is most likely to increase, where potential gaps may need to be addressed, and where strategic investment and expansion are appropriate becomes much more straightforward.
Used properly, projections and forecasts become working tools that support day-to-day decision-making as well as longer-term planning.
The benefits of projections and forecasts include:
A greater understanding of future cashflow and funding needs.
Better planning for growth, recruitment or expansion.
Identifying pressure points before they become problems.
Being able to set realistic budgets and targets.
Data-driven decision-making around pricing and costs.
Placing you in a stronger position with investors, lenders and other stakeholders.
We get to know and understand your business and your industry context, meaning the work we carry out on your behalf is situated in our knowledge of your broader circumstances and ambitions.
We are financial analysis experts, so you’ll benefit from greater insights and in-depth understanding of your data.
Our comprehensive team of specialists are experts across a broad variety of sectors and industries.
From accountancy & tax to financial planning and long-term strategy, Simpson Wood works closely with business-owners, individuals and families to provide independent advice, delivered with care, clarity and commercial understanding.
Richard Wolk – Director of Tax
Projections & forecasts FAQs
How often should forecasts be updated?
Ideally, forecasts should be reviewed regularly and adjusted as performance or conditions change.
Do I need projections if my business is stable and growing?
Yes. Forecasting helps you maintain the stability you have worked hard to achieve. It also enables you to confidently plan improvements and avoid complacency.
Can you help with forecasts for funding or investment?
Absolutely. We regularly support businesses preparing projections for bank finance, investment or internal planning.
How far ahead should I forecast?
Most businesses benefit from a rolling 12-month forecast. Longer-term forecasts should be created for strategic planning or funding discussions.
What are projections based on?
Projections that are practically useful are grounded in real data and experience combined with sensible planning. They are about preparing, rather than perfectly predicting, from a position of strength and understanding.
Can forecasts help with tax planning?
Yes. Forecasting future profits and cashflow helps plan for corporation tax, income tax and VAT.
