Writing Business Plans/Growth Rates
Thanks in advance for reading.
I am in the midst of writing the financials of a business plan for a retail product I plan on getting to the market over the summer.
I am in the Sales Forecast section of my Biz Plan software and they are asking me to guesstimate what my growth rate will be.
I have chosen 7% (for a number of reasons based on market research) but I am confused at to what this number really is.
Essentially they have it showing 7 percent growth, month over month. Meaning, I put the number in the “Growth rate” box provided and when I hit apply, it shows the growth in sales from month to month and it appears to be a 7% increase, every month. For clarity, I started with saying I would sell 5,000 units in month one and it automatically said I would said sell 5350 in month 2, 5725 in month 3 and so on.
Is this correct and a realistic assumption? I thought 7% growth means if we sold 5,000 in year one, wed sell 5350 in year 2? How does this growth rate that they are referring to differ from “year over year” growth?
Any help/advice on the above is greatly appreciated.
THE FORECAST IS GENERALLY --ANNUAL ONE.
SAY, 7% ON 5000=350 [ 2014 TO 2015 ]
-------------5000 TO 5350.
WE MAKE MONTHLY FORECAST TAKING FACTORS LIKE --season/ purchase trend etc.
SAY, BASED ON 5000 ANNUAL,
YOUR AVERAGE MONTHLY = 420
THIS WILL FLUCTUATE DUE
FACTORS LIKE --season/ purchase trend etc.
THEN YOU MUST WATCH EVERY MONTH
THE GROWTH RATE.