Ep.037: Forecasting Your Business

Forecasting gets a bad rap as a spreadsheet chore, but the real work is leadership. We framed the entire conversation around preparation over prediction: the point isn’t to be right, it’s to be ready. That shift unlocks better decisions, calmer teams, and smarter investments when markets wobble. We start with gratitude for 10,000 downloads, then pivot into why leaders need a compass like GPS—Goals, Plans, Systems—to navigate. Forecasting creates clarity, turns guesswork into options, and keeps strategy from becoming shelfware. When teams see the road ahead and the constraints on the path, they make faster trade-offs and stop relying on hope to cover gaps.

A reliable forecast starts with a clean baseline. Pull 12 to 24 months of data and define reality: trends, seasonality, and outliers. Leaders love big visions, but goals must be realistic before they are ambitious. We recommend setting a grounded target with a stretch layer and using milestones to “acclimate,” much like climbing in stages. This is where segmentation matters. Don’t throw a single top-line number at the wall. Break forecasts by revenue stream, product line, market, or location. Assign clear ownership, limit focus to one or two priorities per leader, and link each segment to the systems that produce results. You can’t manage what no one owns.

Assumptions make or break a forecast. Declare them explicitly: growth rates, lead times, pricing, capacity, and seasonality. Then run three views—best case, worst case, and most likely—and define the triggers for shifting between them. This is decision-prepping, not fortune-telling. If you need 20 percent growth, ask if the team has the capacity to deliver and whether pipeline quality supports it. Use the EOS “people analyzer” to check if key roles Got It, Want It, and have the Capacity. Replace hope with design by aligning targets to skills, tools, and time. Every forecast is a story; your assumptions are the plot, and your systems are the characters who must carry it.

Cash deserves its own forecast. Profit and cash rarely move in sync, so leaders need a rolling 13-week cash view to spot timing gaps in receivables and payables. Map inflows by client and terms, stress test delays, and schedule outflows with discipline. Service businesses can be cash-rich and profit-light or the reverse; both are risky if hidden. Use the mantra: revenue is vanity, profit is sanity, cash is survival. This lens guides capital purchases, hiring pace, and marketing spend. Solo operators can win here too: build retainer revenue for stability, outsource low-leverage tasks, and plan “top three” annual purchases tied to price tiers you can confidently charge.

A forecast is a living model. Review monthly, adjust quarterly, and never set-and-forget. Share the numbers with your leaders so clarity becomes confidence and deadlines drive decisions. Keep learning to widen your options—books, mentors, peers, and those you mentor sharpen your judgment in the fog. Surround yourself with a Barnabas (mentor), a Luke (peer), and a Timothy (mentee) to keep perspective. Forecasting shows respect for your team and customers: it treats the future seriously and your stewardship as sacred. When uncertainty hits—and it will—leaders with prepared plans adapt faster, protect cash, and keep their people focused on the next right step.

Chapters:

0:00 Milestones And Season Update

1:45 Gratitude And 10,000 Downloads

3:40 Why Forecasting Matters Now

5:15 GPS: Goals, Plans, Systems

8:30 Prepare, Don’t Predict

10:55 Five Keys To Forecasting

13:05 Baseline And Realistic Goals

16:10 Segment By Streams And Ownership

20:15 Define Assumptions And Scenarios

24:10 Solo Operator Tactics That Work

28:00 People, EOS, And Capacity

31:20 Learning, Mentors, And Your Circle

34:10 Cash Flow And Rolling Forecasts

36:00 Review, Revise, And Stay Ready