Slide 10: Financial Forecast
The financial forecast is a snapshot of the most important aspects of the financial statements. Take a look back at the Financial Projections material to refresh yourself on the content of the financial projections. The main information that you should show in the financial projections are are follows:
- Revenue assumptions (Sales Volume and Average Price)
- Cost Assumptions (Total fixed costs and Variable Costs as a percentage of sales)
- Startup Costs
- End of your Net Profit/Loss for 12 months, Year 2, and Year 3
- Break-even Analysis
The above information will tell the investor about the use of cash and the expected revenues that will result from the expenditure of money. This is the one slide where you may include a complicated slide. You may want to take a snapshot of select portions of the income statement. This will show allow the investor to get a holistic view of the potential revenue production at various points in the business growth cycle.
Too much information can be overwhelming, while too little information can leave a customer or investor uncertain. Generally, it is a safe bet to use the most commonly understood and expected financial calculations, such as the Return on Investment (ROI), PayBack period, Cost-Benefit Analysis, and Profit Margin.