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Financial projections use existing or estimated financial data to forecast your business’s future income and expenses. They often include different scenarios so you can see how changes to one aspect of your finances (such as higher sales or lower operating expenses) might affect your profitability.
If you need to create financial projections for a startup or existing business, this free, downloadable template includes all the tools you need.
What are financial projections used for.
Financial projections are an important business planning tool for several reasons.
- If you’re starting a business, financial projections help you plan your startup budget, assess when you can expect the business to become profitable, and set benchmarks for achieving financial goals.
- If you’re already in business, creating financial projections each year can help you set goals and stay on track.
- When seeking outside financing, both startups and existing businesses will need financial projections to convince lenders and investors of the business’s growth potential.
What’s Included in Financial Projections?
This financial projections template pulls together several different financial documents, including:
- Startup expenses
- Payroll costs
- Sales forecast
- Operating expenses for the first 3 years of business
- Cash flow statements for the first 3 years in business
- Income statements for the first 3 years in business
- Balance sheet
- Break-even analysis
- Financial ratios
- Cost of goods sold (COGS), and
- Amortization and depreciation for your business.
You can either use this template to create the documents from scratch or pull in information from documents you’ve already created. The template also includes diagnostic tools you can use to test the numbers in your financial projections and make sure they are within reasonable ranges.
All of these areas are closely related, so as you work on your financial projections, you’ll find that changes to one element affect the others. You may want to include a best-case and worst-case scenario to account for all possibilities. Make sure you know the assumptions behind your financial projections and can explain them to others.
Startup business owners often wonder how to create financial projections for a business that doesn’t exist yet. Financial projections are always educated guesses. To make yours as accurate as possible, do your homework and get help. Use the information you unearthed in researching your business plans, such as statistics from industry associations, data from government sources, and financials from similar businesses. An accountant with experience in your industry can be useful in fine-tuning your financial projections. So can business advisors such as SCORE mentors.
Once you complete your financial projections, don’t put them away and forget about them. Compare your projections to your actual financial statements on a regular basis to see how well your business is meeting your expectations. If your projections turn out to be too optimistic or too pessimistic, make the necessary adjustments to make them more accurate.
*NOTE: The cells with formulas in this workbook are locked. If changes are needed, the unlock code is "1234." Please use caution when unlocking the spreadsheets. If you want to change a formula, we strongly recommend that you save a copy of this spreadsheet under a different name before doing so.
For assistance in completing this template, we recommend downloading the Financial Projections Template Guide in English or Espanol .
You can also see a completed sample by downloading the Ann's Nursery Example .
Do you need help creating your financial projections? Take SCORE’s online course on-demand on financial projections or connect with a SCORE mentor online or in your community today.
Simple Steps for Starting Your Business: Module 4 - Financial Projections In this online module, you'll learn the importance of financial planning, how to build your financial model, how to understand financial statements and more.
Business Planning & Financial Statements Template Gallery Download SCORE’s templates to help you plan for a new business startup or grow your existing business.
Copyright © 2023 SCORE Association, SCORE.org
Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.
Free Financial Templates for a Business Plan
Smartsheet Contributor Andy Marker
July 29, 2020
In this article, we’ve rounded up expert-tested financial templates for your business plan, all of which are free to download in Excel, Google Sheets, and PDF formats.
Included on this page, you’ll find the essential financial statement templates, including income statement templates , cash flow statement templates , and balance sheet templates . Plus, we cover the key elements of the financial section of a business plan .
Financial Plan Templates
Download and prepare these financial plan templates to include in your business plan. Use historical data and future projections to produce an overview of the financial health of your organization to support your business plan and gain buy-in from stakeholders
Business Financial Plan Template
Use this financial plan template to organize and prepare the financial section of your business plan. This customizable template has room to provide a financial overview, any important assumptions, key financial indicators and ratios, a break-even analysis, and pro forma financial statements to share key financial data with potential investors.
Download Financial Plan Template
Word | PDF | Smartsheet
Financial Plan Projections Template for Startups
This financial plan projections template comes as a set of pro forma templates designed to help startups. The template set includes a 12-month profit and loss statement, a balance sheet, and a cash flow statement for you to detail the current and projected financial position of a business.
Download Startup Financial Projections Template
Excel | Smartsheet
Income Statement Templates for Business Plan
Also called profit and loss statements , these income statement templates will empower you to make critical business decisions by providing insight into your company, as well as illustrating the projected profitability associated with business activities. The numbers prepared in your income statement directly influence the cash flow and balance sheet forecasts.
Pro Forma Income Statement/Profit and Loss Sample
Use this pro forma income statement template to project income and expenses over a three-year time period. Pro forma income statements consider historical or market analysis data to calculate the estimated sales, cost of sales, profits, and more.
Download Pro Forma Income Statement Sample - Excel
Small Business Profit and Loss Statement
Small businesses can use this simple profit and loss statement template to project income and expenses for a specific time period. Enter expected income, cost of goods sold, and business expenses, and the built-in formulas will automatically calculate the net income.
Download Small Business Profit and Loss Template - Excel
3-Year Income Statement Template
Use this income statement template to calculate and assess the profit and loss generated by your business over three years. This template provides room to enter revenue and expenses associated with operating your business and allows you to track performance over time.
Download 3-Year Income Statement Template
For additional resources, including how to use profit and loss statements, visit “ Download Free Profit and Loss Templates .”
Cash Flow Statement Templates for Business Plan
Use these free cash flow statement templates to convey how efficiently your company manages the inflow and outflow of money. Use a cash flow statement to analyze the availability of liquid assets and your company’s ability to grow and sustain itself long term.
Simple Cash Flow Template
Use this basic cash flow template to compare your business cash flows against different time periods. Enter the beginning balance of cash on hand, and then detail itemized cash receipts, payments, costs of goods sold, and expenses. Once you enter those values, the built-in formulas will calculate total cash payments, net cash change, and the month ending cash position.
Download Simple Cash Flow Template
12-Month Cash Flow Forecast Template
Use this cash flow forecast template, also called a pro forma cash flow template, to track and compare expected and actual cash flow outcomes on a monthly and yearly basis. Enter the cash on hand at the beginning of each month, and then add the cash receipts (from customers, issuance of stock, and other operations). Finally, add the cash paid out (purchases made, wage expenses, and other cash outflow). Once you enter those values, the built-in formulas will calculate your cash position for each month with.
Download 12-Month Cash Flow Forecast
3-Year Cash Flow Statement Template Set
Use this cash flow statement template set to analyze the amount of cash your company has compared to its expenses and liabilities. This template set contains a tab to create a monthly cash flow statement, a yearly cash flow statement, and a three-year cash flow statement to track cash flow for the operating, investing, and financing activities of your business.
Download 3-Year Cash Flow Statement Template
For additional information on managing your cash flow, including how to create a cash flow forecast, visit “ Free Cash Flow Statement Templates .”
Balance Sheet Templates for a Business Plan
Use these free balance sheet templates to convey the financial position of your business during a specific time period to potential investors and stakeholders.
Small Business Pro Forma Balance Sheet
Small businesses can use this pro forma balance sheet template to project account balances for assets, liabilities, and equity for a designated period. Established businesses can use this template (and its built-in formulas) to calculate key financial ratios, including working capital.
Download Pro Forma Balance Sheet Template
Monthly and Quarterly Balance Sheet Template
Use this balance sheet template to evaluate your company’s financial health on a monthly, quarterly, and annual basis. You can also use this template to project your financial position for a specified time in the future. Once you complete the balance sheet, you can compare and analyze your assets, liabilities, and equity on a quarter-over-quarter or year-over-year basis.
Download Monthly/Quarterly Balance Sheet Template - Excel
Yearly Balance Sheet Template
Use this balance sheet template to compare your company’s short and long-term assets, liabilities, and equity year-over-year. This template also provides calculations for common financial ratios with built-in formulas, so you can use it to evaluate account balances annually.
Download Yearly Balance Sheet Template - Excel
For more downloadable resources for a wide range of organizations, visit “ Free Balance Sheet Templates .”
Sales Forecast Templates for Business Plan
Sales projections are a fundamental part of a business plan, and should support all other components of your plan, including your market analysis, product offerings, and marketing plan . Use these sales forecast templates to estimate future sales, and ensure the numbers align with the sales numbers provided in your income statement.
Basic Sales Forecast Sample Template
Use this basic forecast template to project the sales of a specific product. Gather historical and industry sales data to generate monthly and yearly estimates of the number of units sold and the price per unit. Then, the pre-built formulas will calculate percentages automatically. You’ll also find details about which months provide the highest sales percentage, and the percentage change in sales month-over-month.
Download Basic Sales Forecast Sample Template
12-Month Sales Forecast Template for Multiple Products
Use this sales forecast template to project the future sales of a business across multiple products or services over the course of a year. Enter your estimated monthly sales, and the built-in formulas will calculate annual totals. There is also space to record and track year-over-year sales, so you can pinpoint sales trends.
Download 12-Month Sales Forecasting Template for Multiple Products
3-Year Sales Forecast Template for Multiple Products
Use this sales forecast template to estimate the monthly and yearly sales for multiple products over a three-year period. Enter the monthly units sold, unit costs, and unit price. Once you enter those values, built-in formulas will automatically calculate revenue, margin per unit, and gross profit. This template also provides bar charts and line graphs to visually display sales and gross profit year over year.
Download 3-Year Sales Forecast Template - Excel
For a wider selection of resources to project your sales, visit “ Free Sales Forecasting Templates .”
Break-Even Analysis Template for Business Plan
A break-even analysis will help you ascertain the point at which a business, product, or service will become profitable. This analysis uses a calculation to pinpoint the number of service or unit sales you need to make to cover costs and make a profit.
Break-Even Analysis Template
Use this break-even analysis template to calculate the number of sales needed to become profitable. Enter the product's selling price at the top of the template, and then add the fixed and variable costs. Once you enter those values, the built-in formulas will calculate the total variable cost, the contribution margin, and break-even units and sales values.
Download Break-Even Analysis Template
For additional resources, visit, “ Free Financial Planning Templates .”
Business Budget Templates for Business Plan
These business budget templates will help you track costs (e.g., fixed and variable) and expenses (e.g., one-time and recurring) associated with starting and running a business. Having a detailed budget enables you to make sound strategic decisions, and should align with the expense values listed on your income statement.
Startup Budget Template
Use this startup budget template to track estimated and actual costs and expenses for various business categories, including administrative, marketing, labor, and other office costs. There is also room to provide funding estimates from investors, banks, and other sources to get a detailed view of the resources you need to start and operate your business.
Download Startup Budget Template
Small Business Budget Template
This business budget template is ideal for small businesses that want to record estimated revenue and expenditures on a monthly and yearly basis. This customizable template comes with a tab to list income, expenses, and a cash flow recording to track cash transactions and balances.
Download Small Business Budget Template
Professional Business Budget Template
Established organizations will appreciate this customizable business budget template, which contains a separate tab to track projected business expenses, actual business expenses, variances, and an expense analysis. Once you enter projected and actual expenses, the built-in formulas will automatically calculate expense variances and populate the included visual charts.
Download Professional Business Budget Template
For additional resources to plan and track your business costs and expenses, visit “ Free Business Budget Templates for Any Company .”
Other Financial Templates for Business Plan
In this section, you’ll find additional financial templates that you may want to include as part of your larger business plan.
Startup Funding Requirements Template
This simple startup funding requirements template is useful for startups and small businesses that require funding to get business off the ground. The numbers generated in this template should align with those in your financial projections, and should detail the allocation of acquired capital to various startup expenses.
Download Startup Funding Requirements Template - Excel
Personnel Plan Template
Use this customizable personnel plan template to map out the current and future staff needed to get — and keep — the business running. This information belongs in the personnel section of a business plan, and details the job title, amount of pay, and hiring timeline for each position. This template calculates the monthly and yearly expenses associated with each role using built-in formulas. Additionally, you can add an organizational chart to provide a visual overview of the company’s structure.
Download Personnel Plan Template - Excel
Elements of the Financial Section of a Business Plan
Whether your organization is a startup, a small business, or an enterprise, the financial plan is the cornerstone of any business plan. The financial section should demonstrate the feasibility and profitability of your idea and should support all other aspects of the business plan.
Below, you’ll find a quick overview of the components of a solid financial plan.
- Financial Overview: This section provides a brief summary of the financial section, and includes key takeaways of the financial statements. If you prefer, you can also add a brief description of each statement in the respective statement’s section.
- Key Assumptions: This component details the basis for your financial projections, including tax and interest rates, economic climate, and other critical, underlying factors.
- Break-Even Analysis: This calculation helps establish the selling price of a product or service, and determines when a product or service should become profitable.
- Pro Forma Income Statement: Also known as a profit and loss statement, this section details the sales, cost of sales, profitability, and other vital financial information to stakeholders.
- Pro Forma Cash Flow Statement: This area outlines the projected cash inflows and outflows the business expects to generate from operating, financing, and investing activities during a specific timeframe.
- Pro Forma Balance Sheet: This document conveys how your business plans to manage assets, including receivables and inventory.
- Key Financial Indicators and Ratios: In this section, highlight key financial indicators and ratios extracted from financial statements that bankers, analysts, and investors can use to evaluate the financial health and position of your business.
Need help putting together the rest of your business plan? Check out our free simple business plan templates to get started. You can learn how to write a successful simple business plan here .
Visit this free non-profit business plan template roundup or download a fill-in-the-blank business plan template to make things easy. If you are looking for a business plan template by file type, visit our pages dedicated specifically to Microsoft Excel , Microsoft Word , and Adobe PDF business plan templates. Read our articles offering startup business plan templates or free 30-60-90-day business plan templates to find more tailored options.
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Cash Flow - Business Plan Forecast Template
Use our business plan financial projections template to create financial projections for a business plan which includes 12 monthly periods and 5 annual periods. The template includes a detailed income statement, cash flow statement and balance sheet in Excel. Cash flow projections are based on user defined turnover, gross profit and expense values and automated calculations based on a series of assumptions.
- Includes 12 monthly & 5 annual periods
- Suitable for service and trade based businesses
- Reporting periods based on a single user input cell
- User input limited to basic template assumptions
- Expense accounts can be customized & more accounts added
- Automated income statement, cash flow statement & balance sheet
- Accommodates loan amortization or interest-only loans
- Includes sales tax, income tax, payroll accruals & dividends
How to use the Cash Flow - Business Plan Forecast template
This template enables users to create cash flow projections for a business plan which includes 12 monthly periods and five annual periods. The template includes a monthly income statement, cash flow statement and balance sheet. The cash flow projections are based on turnover, gross profit and expense values that are entered by the user as well as a number of default assumptions which are used to create an automated balance sheet. These assumptions include opening balance sheet balances, working capital ratios, payroll accruals, sales tax, income tax, dividends and loans. The monthly reporting periods are based on any user defined start date.
Note: We have included 12 monthly and 5 annual reporting periods in this template because this format is frequently required by financial institutions when submitting business plans. If you only require annual cash flow projections, refer to our Annual Cash Flow Projections template and if you only require monthly cash flow projections, refer to our Monthly Cash Flow Projections template.
The following sheets are included in the template: Assumptions - this sheet includes the default assumptions on which the monthly & annual cash flow projections are based. IncState - this sheet includes a detailed monthly income statement for 12 monthly periods and 5 annual periods. All the rows that are highlighted in yellow in column A require user input and the codes in column A are mainly used in the sales tax, receivables & payables calculations. The rows that do not contain yellow highlighting in column A contain formulas and are therefore calculated automatically. CashFlow - as with the income statement, only the rows with yellow highlighting in column A require user input. All the other rows contain formulas and are therefore calculated automatically. BalanceSheet - all balance sheet calculations are based on the template assumptions and the income statement & cash flow statement calculations. No user input is therefore required on this sheet. Loans1 to Loans3 & Leases - these sheets include detailed amortization tables which are used to calculate the interest charges and capital repayment amounts that are included on the income statement and cash flow statement. Each sheet provides for a different set of loan repayment terms to be specified.
Note: If you do not want to include any of the line items that are listed on the income statement, cash flow statement or balance sheet, we recommend hiding these items instead of deleting them. If you delete items which are used in other calculations, these calculations will result in errors which you then need to fix or remove.
Business Name & Reporting Periods
The business name and the start date for the cash flow projections need to be entered at the top of the Assumptions sheet. The business name is included as a heading on all the sheets and the reporting periods which are included in the template are determined based on the start date that is specified. This date is used as the first month and the 11 subsequent months and four subsequent years are added to form the 5 year projection period.
The income statement and cash flow statement only require user input where there is yellow highlighting in column A and the user input only relates to the 12 monthly periods. All annual totals are calculated automatically and all rows without yellow highlighting are calculated automatically in both the monthly and annual columns.
Income Statement
All monthly income statement projections need to be entered exclusive of any sales tax that may be applicable.
Turnover & Gross Profits
Monthly turnover values need to be entered on the IncState sheet for the first 12 months. The projected monthly gross profit percentages also need to be entered on this sheet and are used in order to calculate the gross profit values. The monthly cost of sales projections are calculated by simply deducting the gross profit values from the monthly turnover values.
The year 2 to 5 turnover amounts are calculated based on the totals for the first year and adjusted by the annual turnover growth rates that are specified on the Assumptions sheet. Gross profit percentages for each turnover line need to be entered on the IncState sheet. Gross profit values and cost of sales totals are calculated automatically.
The template includes two default lines in each of these sections - one for a typical product based item and one for a typical service based item. The template can therefore be used for both service and trade based businesses. There are no cost of sales and gross profit values in service based businesses and a gross profit percentage of 100% can therefore be specified. You can also hide the cost of sales and gross profit sections if you do not want to include them in your cash flow projections.
Note: You can insert as many additional line items as required by inserting the required number of items in each section and then entering the appropriate values where user input is required or copying the formulas from one of the existing lines. We recommend inserting additional line items between the two existing default line items.
Note: The codes in column A are used in the sales tax and trade receivables calculations. The first two characters represent the sales tax code and the last two characters represent the payment status. Refer to the Balance Sheet - Sales Tax and Balance Sheet - Trade Receivables sections for more information on these codes.
Other Income
Monthly projections of other income should be entered in this row. Note that other income may consist of items like interest or dividends received and this line item is therefore not included in trade receivables and sales tax calculations. If you want to include other income in the trade receivables or sales tax calculations, you need to add the income to the Turnover section as an additional line item.
The year 2 to 5 totals for other income are calculated by applying the annual turnover growth percentages on the Assumptions sheet to the previous year's total.
Operating Expenses
All the monthly operating expense projections need to be entered in the operating expenses section of the income statement. The template contains 22 default operating expense line items but you can add as many additional items as required or delete the line items that you do not need. When adding additional line items, remember to copy the formulas in the total columns from one of the existing line items.
The year 2 to 5 totals for operating expenses are calculated by applying the annual expense inflation percentages on the Assumptions sheet to the previous year's total.
Note: The codes in column A are used in the sales tax and trade payables calculations. The first two characters represent the sales tax code and the last two characters represent the payment status. Refer to the Balance Sheet - Sales Tax and Balance Sheet - Trade Payables sections for more information on these codes.
Staff Costs
All the monthly staff cost projections need to be entered in the staff costs section of the income statement. The template contains 2 default staff cost line items but you can add as many additional items as required or delete the line items that you do not need.
The year 2 to 5 totals for staff costs are calculated by applying the annual expense inflation percentages on the Assumptions sheet to the previous year's total.
Note: Staff costs have been included in a separate section on the income statement in order to be able to calculate payroll accruals. If you do not need to include payroll accruals in your cash flow projections, we recommend entering nil values and hiding these rows. If you delete the section, some of the payroll accrual formulas may result in errors and you therefore may need to delete them as well.
Depreciation & Amortization
Monthly & annual projections for depreciation and amortization charges need to be calculated independently of the template and included in this section. We unfortunately cannot include default depreciation or amortization calculations because some businesses may have very different asset bases than others with existing assets which may already have been depreciated over a number of years. Any calculation which is based on a percentage of the balance sheet asset value may therefore not be accurate.
If you already have a sheet which is used for depreciation or amortization calculations, you can include it in this template and add formulas in the depreciation & amortization section of the income statement to include your calculations in the appropriate line items.
The monthly depreciation & amortization charges for the first 12 months need to be included on the IncState sheet and the totals for year 2 to 5 need to be included on the Assumptions sheet.
We also realize that some users may want to include depreciation and amortization as part of their operating expenses. We have therefore provided for this in that the depreciation and amortization calculations on the cash flow statement are based on the default code which is included in column A. You can therefore enter nil values in the depreciation & amortization section on the income statement, hide the section and include these line items in the operating expenses section and as long as you also include the default codes in column A, the cash flow statement values for depreciation and amortization will be calculated correctly.
Interest Paid
All interest paid calculations are automated and based on the amortization tables on the Loans1 to Loans3 and Leases sheets. The template accommodates the inclusion of loans & leases based on four different sets of loan repayment terms which need to be specified on the Assumptions sheet.
Opening loan balances are based on the balance sheet opening balances section on the Assumptions sheet and additional loan amounts can be entered in column C of the appropriate amortization table.
You do not need to use all four loan amortization sheets - if you only need to include loans based on one set of repayment terms, you can delete the other loan amortization sheets, delete the other interest paid rows on the income statement, delete the other proceeds from loans rows on the cash flow statement, delete the other repayment of loans rows on the cash flow statement and delete the other loan balances from the balance sheet.
The template provides for four sets of loan repayment terms - the same amortization table can basically be used for all loans with the same repayment terms by adding additional loan amounts as proceeds to the cash flow statement in order to add new loans to the appropriate amortization table.
If you need to add more than four sets of loan repayment terms, you will need to copy one of the amortization sheets, change it to reflect the appropriate loan terms and then change the formulas in the amortization table to be based on the correct loan repayment terms at the top of the sheet. This means that you need to add another set of repayment terms to the Assumptions sheet and link the fields at the top of the new amortization table to the appropriate cells on the Assumptions sheet.
If there is an opening balance for the required additional loan terms, you need to include a new code in the balance sheet opening balances section on the Assumptions sheet and base the opening balance calculation in the first period of the amortization schedule on this code. You also need to add new rows to the interest paid section on the income statement, the loan proceeds section on the cash flow statement, the loan repayment section on the cash flow statement and the loan balances section on the balance sheet. The appropriate formulas can be copied from one of the existing items and the sheet reference in the copied formula can then just be replaced by the sheet name of the new amortization table that you've added.
The taxation line item on the income statement is automatically calculated based on the profit before tax and the income tax assumptions which are specified on the Assumptions sheet. If you do not want to include income tax in the cash flow projections, simply enter an income tax rate of 0%. This will result in no income tax being calculated.
If you do want to include income tax calculations, the appropriate income tax percentage needs to be entered in the Income Tax section on the Assumptions sheet. You can also enter a value for an assessed loss (as a positive value) which may have been carried over from a previous tax year which would result in income tax only being calculated after profits exceed the value of the assessed loss.
You also need to specify the payment frequency in months and the first calendar month in which a payment needs to be included. The template automatically provides for income tax based on what is due and includes the income statement amount and a provision for taxation on the balance sheet. The payment frequency and month of payment assumptions are then used to determine when the income tax liability will be settled which will result in the appropriate cash outflow being recorded on the cash flow statement and the provision for taxation being reduced.
The template can accommodate income tax calculations based on current and subsequent month payments. If you select the Current option, the income tax payment amount will be calculated based on all amounts that have accrued up to and including the month of payment. If you select the Subsequent option, the income tax payment amount will only be calculated based on all amounts which have accrued up to the previous month end.
Example: If you select the Current option in the Income Tax section of the Assumptions sheet, all income tax amounts up to and including the current month will be included in the income tax payment amount. This means that the provision for taxation at the end of the particular month will be nil. The Current setting is therefore usually appropriate for provisional taxpayers.
Example: If you select the Subsequent option, all amounts up to and including the previous month end will be included in the income tax payment amount. The provision for taxation balance on the balance sheet will therefore not be nil at the end of the month of payment and include the current month's income tax charge.
The template also includes automated dividends calculations. If you do not want to include any dividends in your cash flow projections, you can simply specify a dividend percentage of zero percent.
If you want to include dividend calculations, you need to specify a dividend percentage which will be applied to the profit for the period in order to calculate the dividend value. You also need to specify the frequency in months of dividend payments and the first payment month. The frequency of dividends determines when the dividends are included on the income statement and the first month of payment determines when the dividend payment is included on the cash flow statement (only has an effect if the dividend payment option is Subsequent).
You can also specify whether the dividend is paid in the month of calculation (Cash option), the month after calculation (Next option) or in a subsequent month. When you elect the subsequent month option, the payment of the dividend will be included based on the relative position of the first month of payment in relation to the year-end period (which is determined based on the template start date at the top of the Assumptions sheet).
Example: If you want to include a dividend in the last month of each financial year, select a payment frequency of 12 months and month 12 as the first payment month. Then select the Cash option in order to include both the dividend on the income statement and the payment in the last month of the year.
Example: If you want to include a dividend in the last month of each financial year but delay payment to the first month of the next financial year, select a payment frequency of 12 months and month 12 as the first payment month. Then select the Next option in order to include the dividend on the income statement in the last month of the financial year and the payment in the first month of the next financial year. A dividend payable amount will then automatically be included on the balance sheet at year-end.
Balance Sheet
All the calculations on the balance sheet are automated and no user input is therefore required.
Opening Balances
If you need to compile cash flow projections for an existing business, you will need to include the opening balance sheet balances at the start of the cash flow projection period. This is facilitated in the Balance Sheet Opening Balances section on the Assumptions sheet. The opening balances that are entered here are included in the first column on the balance sheet.
You can use the trial balance as at the end of the period immediately before the start of the cash flow projection period for this purpose. All assets should have positive balances and all equity & liabilities should have negative balances. The opening balances should also balance to a total of nil as with any accounting system trial balance. If you enter balances and the total of all balances is not nil, the entire opening balances section on the Assumptions sheet will be highlighted in orange.
You then need to fix the imbalance by adjusting the opening balances so that the total comes to a total of nil. The orange highlighting will then be removed automatically. Also note that the cash flow projection balance sheet cannot balance if the opening balances do not balance.
Note: If you are preparing a cash flow projection for a new business, you can include zero balances for all the balance sheet items in the opening balances section.
Non-Current Assets
The property, plant & equipment balances on the balance sheet are calculated by adding the purchases of property, plant & equipment (entered on the cash flow statement for the first 12 months and on the Assumptions sheet for year 2 to 5) and then deducting the appropriate depreciation charges that are included on the income statement.
Intangible assets balances are calculated in much the same way by adding the purchases of intangible assets (as per the cash flow statement for the first 12 months and the Assumptions sheet for year 2 to 5) and deducting the appropriate amortization charges as per the income statement. The calculation of the investments balances on the balance sheet is a bit simpler in that only the purchases of new investments (as per the cash flow statement for the first 12 months and the Assumptions sheet for your 2 to 5) are added to the previous period's balance and there is no depreciation or amortization on investments.
Note: Purchases of property, plant & equipment, intangible assets and investments all need to be entered as negative values. The purchases for the first 12 months need to be entered on the cash flow statement and the purchases for year 2 to 5 need to be entered on the Assumptions sheet.
Current Assets - Inventory
The inventory balances on the balance sheet are calculated based on the inventory days assumption which is specified on the Assumptions sheet. The number of days that are entered here is applied to the monthly cost of sales in order to calculate the appropriate inventory balance. This calculation is based on the actual number of days in each month if the inventory days assumption is greater than the number of days in the appropriate month.
Example: If you enter an inventory days assumption of 60 days and the month is April, the entire cost of sales value for April will be included in the inventory balance because April only has 30 days. After including the 30 days in April, there is a difference of 30 days between the 60 days assumption and the 30 days in April. The March cost of sales balance will therefore be used, divided by the 31 days in March and multiplied by the 30 remaining days. The inventory balance at the end of April will therefore consist of the cost of sales total for April and an equivalent of 30 days of the 31 day cost of sales of March.
Note: The above calculation principle is applied regardless of the number of days which are entered as the inventory days assumption on the Assumptions sheet even if the value of the inventory days assumption requires the inclusion of more than 2 months. This method of calculation is the most accurate way of projecting inventory balances even for businesses where there is significant sales volatility.
Note: If your business does not carry inventory, you can simply enter a nil value in the inventory days assumption on the Assumptions sheet. The inventory line on the balance sheet will then also contain nil values.
If you want to include variable monthly inventory days, you can do so by changing the inventory days assumption in the Workings section of the balance sheet which has been included below the section with the ratios. Simply replace the formula which links the inventory days assumption to the value on the Assumptions sheet by overwriting it with the appropriate inventory days value.
The year 2 to 5 inventory balances are calculated by applying the annual turnover growth percentage to the inventory balance at the end of year 1. This method ensures that the monthly trend in year 1 is reflected in the year 2 to 5 balances. If you amend the inventory days in the Workings section of the balance sheet, the amended days for the appropriate year will be used in the calculation.
Current Assets - Trade Receivables
The trade receivables balances on the balance sheet are calculated based on the debtors days assumption which is specified on the Assumptions sheet. The debtors days number can be determined based on the average trading terms which has been negotiated with customers. The debtors days is applied to the monthly turnover in order to calculate the appropriate trade receivables balance. This calculation is based on the actual number of days in each month if the debtors days assumption is greater than the number of days in the appropriate month.
Example: If you enter a debtors days assumption of 60 days and the month is April, the entire turnover value for April will be included in the trade receivables balance because April only has 30 days. After including the 30 days in April, there is a difference of 30 days between the 60 days assumption and the 30 days in April. The March turnover balance will therefore be used, divided by the 31 days in March and multiplied by the 30 remaining days. The trade receivables balance at the end of April will therefore consist of the turnover total for April and an equivalent of 30 days of the 31 day turnover of March.
Note: The above calculation principle is applied regardless of the number of days which are entered in the debtors days assumption on the Assumptions sheet even if the value of the debtors days assumption requires the inclusion of more than 2 months. This method of calculation is the most accurate way of projecting trade receivable balances even for businesses where there is significant sales volatility.
Where sales tax is applicable, the appropriate sales tax value relating to monthly turnover will be added to the trade receivables balance. Sales tax codes are defined on the Assumptions sheet and the codes in column A next to the turnover amounts on the income statement are used to determine the appropriate rate of sales tax to be used.
The trade receivables calculation will also only include lines that are coded with a sales tax rate code (in the first two characters) and a "C1" at the end of the code. The C1 part of the code refers to credit sales while the inclusion of a C0 code at the end refers to cash sales. Cash sales do not need to be included in the trade receivables calculation and turnover lines with C0 or no code in column A are therefore ignored when calculating trade receivable balances.
Example: If the standard rate sales tax code is V1 and the appropriate turnover line needs to be included in the calculation of trade receivables, the code V1C1 needs to be added in column A of the appropriate turnover line on the income statement. If you do not want to add sales tax in the trade receivables calculation but you do want a trade receivables line to be included in the balance sheet, you can add a code which refers to a 0% sales tax calculation as well as the C1 credit sales indicator.
Example: If you do not want a particular turnover line to be included in the trade receivables calculation, you can include any sales tax rate followed by C0 in order to exclude the line in the trade receivables calculations. For example, a turnover line with a code of V1C0 would not form part of the trade receivables calculations.
Note: If your business has no trade receivables, you can simply enter a nil value in the debtors days assumption on the Assumptions sheet. The trade receivables line on the balance sheet will then also contain nil values.
If you want to include variable monthly debtors days, you can do so by changing the debtors days assumption in the Workings section of the balance sheet which has been included below the section with the ratios. Simply replace the formula which links the debtors days assumption to the value on the Assumptions sheet by overwriting it with the appropriate debtors days value.
The year 2 to 5 trade receivables balances are calculated by applying the annual turnover growth percentage to the trade receivables balance at the end of year 1. This method ensures that the monthly trend in year 1 is reflected in the year 2 to 5 balances. If you amend the debtors days in the Workings section of the balance sheet, the amended days for the appropriate year will be used in the calculation.
Current Assets - Loans & Advances, Other Receivables
The loans and advances & other receivables balances cannot be calculated by basing them on specific income statement items and they are therefore calculated by adding the movements in these balances (as per the cash flow statement for the first 12 months and the Assumptions sheet for year 2 to 5) to the balances of the previous month. If you therefore want to increase or decrease these balances, you need to add the amount of the increase or decrease to the line with a matching description on the cash flow statement (under the changes in operating assets section) for the first 12 months or the Assumptions sheet for year 2 to 5.
Current Assets - Cash & Cash Equivalents
The cash & cash equivalents balances on the balance sheet are linked to the closing cash balances on the cash flow statement. If the resulting cash & cash equivalents balance has a negative value, it will automatically be included in the bank overdraft line in the Current Liabilities section of the balance sheet.
Equity - Shareholders Contributions, Reserves
The shareholders contributions & reserves balances cannot be calculated by basing them on income statement items and they are therefore calculated by adding the movements in these balances (as per the cash flow statement for the first 12 months and the Assumptions sheet for year 2 to 5) to the balances of the previous month. If you therefore want to increase or decrease these balances, you need to add the amount of the increase or decrease to the line with a matching description on the cash flow statement or Assumptions sheet.
Note: The shareholders contribution line on the cash flow statement can be found under the cash flow from financing activities and the reserves line on the cash flow statement under the non-cash adjustments.
Equity - Retained Earnings
The retained earnings balances on the balance sheet are linked to the retained earnings for the year which is calculated on the income statement.
Non-Current Liabilities - Loans 1 to 3, Leases
The template provides for loans & leases to be included based on 4 different sets of loan repayment terms. Loans with the same repayment terms can be grouped together in the appropriate line item. There is no difference between the treatment of loans 1 to 3 and leases. If you do not have finance leases and have loans with 4 different sets of repayment terms, you can use the Leases sheet and rename the appropriate line items accordingly.
Note: The loan repayment period in years is limited to a maximum period of 30 years. If you want to include a loan repayment period which exceeds this period, you need to change the data validation settings in the appropriate input cell by selecting the data validation feature from the Data tab on the Excel ribbon and editing the maximum value of 30 which has been set in the loan repayment period cells.
Each of the loan repayment terms can be specified in the Loan Terms section on the Assumptions sheet. The loan terms include the annual interest rate, loan repayment period in years and a selection field which can be used to indicate interest-only loans. These loan repayment terms are then included at the top of the appropriate loan amortization sheet on the Loans1 to Loans3 and Leases sheets.
Note: A set of loan terms can be specified as interest-only by selecting the "Yes" option from the interest-only drop-down list in the appropriate loan terms on the Assumptions sheet. If this selection is made, the loan will be interest only and not include any loan repayments.
All the calculations on the amortization sheets are fully automated. The only user input that is required on these sheets is entering the additional loan amounts in column C. The loan terms are taken from the Assumptions sheet and the opening balances in the first row of the amortization table are based on the opening balances that are entered in the balance sheet opening balances section of the Assumptions sheet.
The loan repayments, interest charged and capital repayments are calculated based on the outstanding balances at the beginning of each period. The outstanding loan or lease balances at the end of the appropriate monthly or annual period are then included in the appropriate lines on the balance sheet.
Current Liabilities - Bank Overdraft
The bank overdraft as well as cash & cash equivalents are based on the closing cash balances which are calculated on the cash flow statement. If the appropriate monthly closing balance is negative, the balance is included as a bank overdraft and if it is positive, it is included as cash under current assets on the balance sheet.
Current Liabilities - Trade Payables
The trade payables balances on the balance sheet are calculated based on the creditors days assumption which is specified on the Assumptions sheet. The number of days that are included here can be determined based on the average trading terms which has been negotiated with suppliers.
The monthly cost of sales, operating expenses and staff costs on the income statement are added together in order to determine a monthly value on which the trade payables calculations should be based. Expenses and costs which are paid on a cash basis can be excluded from the trade payables calculation by entering a code which ends in C0 in column A on the income statement. The codes in column A start with the appropriate two character sales tax code and end with the two character payables code.
Example: The expense codes in column A for all line items that need to be included in the trade payables calculation and which need to be subject to sales tax at a standard rate should be V1C1. If the expense item is settled on a cash basis and also subject to the standard sales tax rate, the code in column A should be V1C0 which will then result in the item not being included in the trade payables calculation.
If you want to also include purchases of property, plant & equipment in the trade payables calculation, the standard code of PPE in column A on the cash flow statement needs to be amended to the appropriate code which starts with the sales tax code and ends with C1. For standard sales tax, the code will therefore be V1C1.
Like the calculation of inventory and trade receivables balances, the trade payables balances on the balance sheet are based on the actual number of days in each month if the creditors days assumption is greater than the days in the appropriate month.
Example: If you enter a creditors days assumption of 60 days and the month is April, the entire cost of sales & expense value for April will be included in the trade payables balance because April only has 30 days. After including the 30 days in April, there is a difference of 30 days between the 60 days assumption and the 30 days in April. The March cost of sales & expense balance will therefore be used, divided by the 31 days in March and multiplied by the 30 remaining days. The trade payables balance at the end of April will therefore consist of the cost of sales & expenses total for April and an equivalent of 30 days of the 31 day cost of sales & expense values of March.
Note: The above calculation principle is applied regardless of the number of days which are entered as the creditors days assumption on the Assumptions sheet even if the value of the creditors days assumption requires the inclusion of more than 2 months. This method of calculation is the most accurate way of projecting trade payables balances even for businesses where there is significant sales or expense volatility.
Where sales tax is applicable, the appropriate sales tax value relating to monthly cost of sales & expenses will be added to the trade payables balance. Sales tax codes are defined on the Assumptions sheet and the code in column A next to the cost of sales & expense amounts on the income statement are used to determine the appropriate rate of sales tax to be used.
The trade payables calculation will also only include lines that are coded with a sales tax rate code (in the first two characters) and a "C1" at the end of the code. The C1 part of the code refers to purchases on credit while the inclusion of a C0 code at the end refers to cash purchases. Cash purchases do not need to be included in the trade payables calculation and cost of sales & expense lines with C0 or no code in column A are therefore ignored when calculating trade payables balances.
Example: If the standard rate sales tax code is V1 and the appropriate cost of sales or expense line needs to be included in the calculation of trade payables, the code V1C1 needs to be added in column A of the appropriate line on the income statement. If you do not want to add sales tax in the trade payables calculation but you do want a trade payables line to be included in the balance sheet, you can add a code which refers to a 0% sales tax calculation as well as the C1 credit purchases indicator.
Example: If you do not want a particular cost of sales or expense line to be included in the trade payables calculation, you can include any sales tax rate followed by C0 in order to exclude the line in the trade payables calculations. For example, an expense or cost of sales line item with a code of V1C0 in column A on the income statement would not form part of the trade payables calculations.
Note: If your business has no trade payables, you can simply enter a nil value in the creditors days assumption on the Assumptions sheet. The trade payables line on the balance sheet will then also contain nil values.
If you want to include variable monthly creditors days, you can do so by changing the creditors days assumption in the Workings section of the balance sheet which has been included below the section with the ratios. Simply replace the formula which links the creditors days assumption to the value on the Assumptions sheet by overwriting it with the appropriate creditors days value.
The year 2 to 5 trade payables balances are calculated by applying the annual expense inflation percentage to the trade payables balance at the end of year 1. This method ensures that the monthly trend in year 1 is reflected in the year 2 to 5 balances. If you amend the creditors days in the Workings section of the balance sheet, the amended days for the appropriate year will be used in the calculation.
Current Liabilities - Sales Tax
The template accommodates the inclusion of sales tax in all relevant calculations based on four default sales tax calculation codes and any sales tax period. All income statement and cash flow statement items need to be entered exclusive of any sales tax that may be applicable and the trade receivables and trade payables balances on the balance sheet will be calculated inclusive of sales tax. The net sales tax liability is included in the Sales Tax line on the balance sheet.
The template can be used for general sales tax (GST) and value added tax (VAT) purposes. Where there is no sales tax input which reduces the sales tax liability, the codes in column A on the income statement can simply be changed to contain a sales tax code (in the first two characters of the code) which has a zero percentage. Only the sales tax codes that are included next to the turnover lines will then be included in sales tax calculations (as required by some general sales tax calculations).
The appropriate sales tax percentages can be entered in the Sales Tax section of the Assumptions sheet. The template provides for 4 default sales tax codes, each with its own sales tax percentage. The sales tax codes are numbered from V1 to V4.
The income statement contains codes in column A which affects the calculations of sales tax and trade receivables or trade payables. The first two characters of these codes determine which sales tax percentage is used in the sales tax calculations. If an income statement item needs to be excluded from sales tax calculations, you should use a sales tax code with a zero percentage on the Assumptions sheet.
Note: Each line on the income statement can therefore only be linked to one sales tax percentage. If more than one sales tax percentage needs to be applied to the same income statement item, you need to split the income statement amount into two lines and enter the appropriate sales tax codes in column A for each of the lines.
Note: If you are preparing cash flow projections for a business which is not subject to sales tax, simply enter zero percentages for all four sales tax codes.
The sales tax assumptions that need to be specified on the Assumptions sheet also include the frequency of sales tax payments (in months) and the calendar month of the first payment period. You can therefore calculate sales tax based on any period frequency from one to twelve months.
Example: If your business is subject to sales tax payments of every two months and the first payment is due in February, a frequency of 2 needs to be specified and the first payment month should be set to 2 for February. Similarly, if your business is subject to sales tax payments of every 6 months with payments due in March and August, the frequency should be set to 6 and the first payment month should be set to 3. If your business is subject to monthly sales tax payment periods, the frequency should be 1 and the first payment month should also be 1.
The Current or Subsequent setting in the Sales Tax section on the Assumptions sheet determines how the calculated sales tax amounts of the current period are handled. If you select the Current option, the sales tax amounts of the current period will be included in the calculation of the payment amount which is due in the particular month and the sales tax liability at the end of the payment month will be nil.
If you select the Subsequent setting, the sales tax amount of the current period is not included in the calculation of the payment amount and the sales tax liability at the end of the appropriate payment month will always include at least one month.
Note: The Subsequent setting is usually the appropriate setting to use for sales tax purposes. The Current settings is more applicable to tax types which are subject to provisional tax.
Example: If you set a payment frequency of 1 month, first payment month of 1 and select the Current option, the sales tax liability on the balance sheet will always be nil because the current month's sales tax will be included in the sales tax payment. If you have the same period settings and select the Subsequent option, the sales tax liability on the balance sheet will always include the current month's sales tax because the payment amount will be based on the previous month's sales tax.
Note: The first payment month setting refers to the month of payment and not the sales tax period end. There is a difference - a sales tax period may end in February with payment in March which means that the first payment month of the calendar year is actually January or month 1 (if the payment frequency is two months).
The year 2 to 5 balances for sales tax are calculated by calculating the total sales tax for the appropriate year, dividing it by twelve and then multiplying the value by the number of months that are included in the sales tax balance at the end of the first year.
Current Liabilities - Payroll Accruals
The payroll accrual on the balance sheet is based on the payroll accrual assumptions in the Working Capital section of the Assumptions sheet and the amounts in the staff costs section of the income statement. If payroll deductions are paid in the same month as they are incurred, you can set the payroll accrual percentage to zero and the payroll accrual balances on the balance sheet will also be zero.
Staff costs have been included in a separate section on the income statement to make it easier to calculate payroll accrual balances. You can however include staff costs in operating expenses but you need to ensure that you also include the "PAY" code in column A for all the staff costs that you want to include in the payroll accrual calculations.
You also need to specify the appropriate percentage of staff costs which needs to be included in your payroll accruals. This percentage should be based on the percentage of staff costs which are paid in a subsequent month and is based on the current month's staff costs. Payroll accruals usually consist of salary & wage deductions which need to be paid over to third parties and differ from entity to entity. You therefore need to calculate the appropriate payroll accrual percentage based on the composition of the salary or wage structures of all employees.
The payroll accrual assumptions that need to be specified on the Assumptions sheet also include the frequency of payroll accrual payment periods (in months) and the payment month of the first payroll accrual period. You can therefore calculate payroll accruals based on any payment period frequency from one to twelve months. The calculated payroll accruals are added together in the payroll accrual balance until the month of payment.
Example: If you need to settle payroll accruals every two months and the first payment is due in February, a frequency of 2 needs to be specified and the first payment month should be set to 2 for February. Similarly, if you settle payroll accruals every 6 months with payments due in March and August, the frequency should be set to 6 and the first payment month should be set to 3. If you settle payroll accruals on a monthly basis, the frequency should be 1 and the first payment month should also be 1.
The Current or Subsequent setting in the Payroll Accruals section on the Assumptions sheet determines how the calculated payroll accrual amounts of the current period are handled. If you select the Current option, the payroll accrual amounts of the current period will be included in the calculation of the payment amount which is due in the particular month and the payroll accrual balance at the end of the payment month will be nil.
If you select the Subsequent setting, the payroll accrual amounts of the current period are not included in the calculation of the payment amount and the payroll accrual balances on the balance sheet at the end of the appropriate payment month will always include at least one month.
Note: The Subsequent setting is usually the appropriate setting to use for payroll accrual purposes. The Current setting is more applicable to tax types which are subject to provisional tax payments where payment occurs in the same month as the tax calculation.
Example: If you set a payment frequency of 1 month, first payment month of 1 and select the Current option, the payroll accruals on the balance sheet will always be nil because the current month's payroll accruals will be included in the payment calculation. If you have the same period settings and select the Subsequent option, the payroll accruals on the balance sheet will always include the current month's payroll accrual because the payment amount will be based on the previous month's payroll accrual.
Note: The first payment month setting refers to the month of payment and not the payroll accrual period end. There is a difference - a payroll accrual period may end in February with payment in March which means that the first payment month of the calendar year is actually January or month 1 (if the payment frequency is two months).
If you want to include payroll accruals based on variable monthly payroll accrual percentages, you can do so by changing the payroll accrual percentage assumption in the Workings section of the balance sheet which has been included below the section with the ratios. Simply replace the formula which links the payroll accrual percentage assumption to the value on the Assumptions sheet by overwriting it with the appropriate payment accrual percentage.
The year 2 to 5 payroll accrual balances are calculated by adjusting the previous year's balance by the appropriate expense inflation percentage on the Assumptions sheet.
Current Liabilities - Other Accruals, Other Provisions
The other accrual & other provisions balances cannot be calculated by basing them on specific income statement items and they are therefore calculated by adding the movements in these balances (as per the cash flow statement for the first 12 months and the Assumptions sheet for year 2 to 5) to the balances of the previous period. If you therefore want to increase or decrease these balances, you need to add the amount of the increase or decrease to the line with a matching description on the cash flow statement (under the changes in operating assets section) for the first 12 months or the Assumptions sheet for years 2 to 5.
Current Liabilities - Provision for Taxation
The calculation of income tax on the income statement is based on the profit before tax on the income statement and the assumptions that are specified in the Income Tax section on the Assumptions sheet.
The profit before tax amount is multiplied by the income tax percentage on the Assumptions sheet in order to calculate the monthly or annual income tax value. If there is a loss before tax on the income statement, no income tax will be calculated but if there were profits before the period with the loss, the income tax that was calculated in previous periods will be reversed in the period with the loss.
The template also makes provision for the inclusion of an assessed loss which has been carried over from previous financial periods and income tax will only be calculated after the assessed loss has been fully reduced by profits in the projection periods.
The income tax assumptions on the Assumptions sheet also include the frequency of payment of income tax (in months) and the calendar month of the first income tax payment. You can therefore calculate a provision for income tax based on any payment period frequency from one to twelve months. The calculated income tax amounts are added together in the provision for income tax balance on the balance sheet until the month of payment.
Example: If you need to settle income tax liabilities every six months and the income tax payments are due in February and August of each year, a frequency of 6 needs to be specified and the first calendar month should be set to 2 for February. Similarly, if you settle income tax liabilities at the end of each quarter with payments due in March, June, September and December, the frequency should be set to 3 and the first payment month should also be set to 3. If you need to settle income tax liabilities 9 months after each year-end and the cash flow projection year-end is February, the frequency should be set to 12 months and the first payment month should be set to 11.
The Current or Subsequent setting in the Income Tax section on the Assumptions sheet determines how the income tax amounts of the current period are handled. If you select the Current option, the income tax amounts of the current period will be included in the calculation of the payment amount which is due in the particular month and the provision for income tax balance on the balance sheet at the end of the payment month will be nil.
If you select the Subsequent setting, the income tax amounts of the current period are not included in the calculation of the payment amount and the provision for income tax balance on the balance sheet at the end of the appropriate payment month will always include income tax for at least one month.
Note: The Current setting is usually the appropriate setting to use for income tax purposes if the entity is a provisional taxpayer which effectively means that income tax is paid in advance. If the entity is not a provisional taxpayer, the Subsequent setting should be used because income tax will be settled after being incurred.
The year 2 to 5 balances are calculated by calculating the income tax amount for the appropriate year, dividing it by 12 and multiplying the value by the number of months which needs to be included in the provision. This is determined based on the year-end period and the income tax assumptions on the Assumptions sheet.
Current Liabilities - Dividends Payable
The calculation of dividends on the income statement is based on the profit for the year on the income statement and the assumptions that are specified in the Dividends section on the Assumptions sheet. Dividends will only be calculated if you enter a dividend percentage on the Assumptions sheet - if you therefore do not want to include dividends in your cash flow projections, you can simply enter a zero value as the dividend percentage.
The dividend percentage that is specified on the Assumptions sheet is applied to the profit for the year on the income statement which can be found directly above the dividends line. Dividends will also only be calculated if there is a cumulative profit for the year.
The dividends assumptions on the Assumptions sheet also include the frequency of payment of dividends (in months) and the first calendar month of the dividend payment. You can therefore calculate dividends based on any payment period frequency from one to twelve months (although 6 or 12 months is the norm). The calculated dividends amounts are added together in the dividends payable balance on the balance sheet until the month of payment.
Example: If dividends are declared every six months, you need to specify a frequency of 6 months on the Assumptions sheet and then select the appropriate payment basis. Dividends will be reflected on the income statement every 6 months and the dividends payable balances on the balance sheet will be determined based on the first payment month and the payment option which is selected (Cash, Next or Subsequent). Similarly, if the payment frequency is set to 12 months, dividends will be included on the income statement every 12 months and the dividends payable balance will be determined based on the first payment month and the payment option.
The Cash, Next or Subsequent setting in the Dividends section on the Assumptions sheet determines how the dividends payable balances on the balance sheet are calculated and therefore also when the dividend payment will be included on the cash flow statement.
If you select the Cash option, the dividend payable balances on the balance sheet will always be nil and what this means is that the dividend payment is effectively included in the same month as the month in which the dividend is declared. The month in which the declared dividend is included is based on the payment frequency (in months) and the cash flow projection year-end.
If you select the Next option, the dividend payment will be included in the month after the month in which the dividend amount is included on the income statement. The dividend payable balance on the balance sheet will therefore only contain a balance in the dividend declaration month.
If you select the Subsequent option, dividends will be included on the income statement based on the frequency setting on the Assumptions sheet and the payment of the dividend will be delayed until the first payment month (also as per the Assumptions sheet) is reached. A dividends payable balance will be reflected on the balance sheet in all months until the payment month is reached.
Example: If you set the dividend payment frequency to 12 months, a dividend amount will be included on the income statement in the last month of the appropriate cash flow projection year. If the payment option is set to Cash, no dividend payable amount will be included on the balance sheet and the dividend payment will be included on the cash flow statement in the same month.
Example: If you set the dividend payment frequency to 12 months and the payment option is set to Next, the dividend will be included on the income statement in the last month of the appropriate cash flow projection year, the dividend payable at the end of the financial year will equal the income statement amount and the dividend payment will be included in the first month of the next financial year.
Example: If you set the dividend payment frequency to 12 months and the payment option is set to Subsequent, the dividend will be included on the income statement in the last month of the appropriate cash flow projection year and the dividend payable at the end of the financial year and all subsequent months in the new financial year until the first payment month is reached will equal the income statement amount. The dividend payment will be included in the first payment month as set on the Assumptions sheet but in the year after inclusion on the income statement.
If the cash flow projection year-end as per the above example is February, the first payment month is set to 9 for September and the Subsequent payment option is selected, the dividend will be included in February on the income statement and the same amount will be included as a dividend payable on the balance sheet from February to August of the next financial year. The dividend payment will then be included in September on the cash flow statement and the dividend payable at the end of September will be nil.
The year 2 to 5 balances are calculated based on the profit for the year, the dividend percentage and the payment status of Cash, Next or Subsequent.
Balance Sheet Errors
If the balance sheet for any monthly or annual period does not balance, the amount of the imbalance will be included in the row below the total equities & liabilities and displayed in red. The template has been designed in such a way that the balance sheet should always be in balance as long as the total of the balance sheet opening balances which are included on the Assumptions sheet is nil.
If you see an imbalance on the balance sheet, you therefore need to check the opening balance sheet balances on the Assumptions sheet and ensure that the total of all the opening balances in this section is nil.
If fixing the opening balances does not resolve your imbalance, you can e-mail our Support function and let us know what changes you have made to the formulas in the template so that we can assist you. If you have made a lot of changes, you may need to start over with the downloaded copy of the template.
Balance Sheet Workings
We have included all the calculations which form part of the calculation of balance sheet balances in the Workings section below the balance sheet ratios. These workings will not be printed and are for information purposes only. You can therefore hide this section if you do not want to see it on the sheet but do not delete any of these formulas because it will result in calculation errors if you do!
Cash Flow Statement
All the rows on the cash flow statement which require user input are indicated with yellow highlighting in column A. User input is only required in the monthly columns - the user input for the annual columns need to be included on the Assumptions sheet in the first balance sheet section. All the rows on the cash flow statement which do not contain yellow highlighting contain formulas which automate the calculations of these items.
The input rows on the cash flow statement are all related to balance sheet items where the calculations on the balance sheet are based on adding the movement on the cash flow statement to the previous month's balance on the balance sheet. If you need more guidance on any of these items, refer to the appropriate section for the particular item under the Balance Sheet section of these instructions.
Note: The colour of the codes in column A on the cash flow statement indicate whether positive or negative values need to be entered in order to increase the appropriate balance sheet item's balance. If the code is green, positive input values increase the balance sheet balance and if the code is red, you need to enter negative values in order to increase the balance sheet balances.
Loan Amortization Tables (Loans1 to Loans3 & Leases sheets)
The template makes provision for including loans with up to four different sets of repayment terms in the cash flow projections. The amortization tables that are used to calculate the interest charges, loan repayments and outstanding balances have been included on the Loans1, Loans2, Loans3 and Leases sheets. The only user input that is required on these sheets is the additional loan amounts in column C.
Note: Refer to the instructions in the income statement - interest paid section and the balance sheet - non-current liabilities section for guidance on how these amortization tables have been compiled and where to include user input for each of these amortization tables.
Sales | Templates
9 Free Sales Forecast Templates for Small Business
REVIEWED BY: Jess Pingrey
Jess served on the founding team of a successful B2B startup and has used a wide range of sales and marketing tools over the course of her 15-year career. She uses her industry knowledge to deliver the best answers to your questions about sales tools and sales management.
WRITTEN BY: Bianca Caballero
Published September 8, 2022
Bianca is a staff writer at Fit Small Business who specializes in Customer Relationship Management (CRM) software.
This article is part of a larger series on Sales Management .
- 1 Simple Sales Forecast Template
- 2 Long-term Sales Forecast Template
- 3 Budget Sales Forecast Template
- 4 Month-to-month Sales Forecast Template
- 5 Individual Product Sales Forecast Template
- 6 Multi-product Sales Forecast Template
- 7 Retail Sales Forecast Template
- 8 Subscription-based Sales Forecast Template
- 9 B2B Lead Sales Forecast Template
- 10 CRMs with Built-in Sales Forecasting
- 11 How to Create a Custom Sales Forecast Template
- 12 Bottom Line
There are different free sales forecast templates available for Excel and Google spreadsheets and through customer relationship management software. These tools help you create projections you can use for things like goal setting, performance measurement, budgeting, projecting growth, obtaining financing, and attracting investors.
To save you time, we’ve compiled nine free forecast templates you can download below. Each downloadable file contains an example forecast that you can use as reference. We also included a blank template that you can copy and fill in with your own sales data.
1. Simple Sales Forecast Template
Our free simple sales forecast template will help you get started with sales estimates to plan and grow your business. This multi-year projection sheet can be modified in either Google Sheets or Excel. It can also generate future revenue estimates based on units sold, pipeline growth percentages, lead conversion rates, and your product pricing. This gives you an idea of how much your business can grow sales-wise in the next few years.
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Sales Forecast Template — Multi-year
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Sales Forecast Template - One-Year
2. Long-term Sales Forecast Template
Part of creating a sales plan is forecasting long-term revenue goals and sales projections, then laying out the strategies and tactics you’ll use to hit your performance goals. Long-term sales projection templates usually provide three- to five-year projections. These templates are accessible in both Excel and Google Sheets.
3-Year Forecast Template
Projection of units sold and gross profit from a three year-forecast template
Three-year projection of units sold
Long-term sales forecast templates are best for businesses looking to scale and want insights about how much working capital they can expect to be able to tap into for growth initiatives. This type of sales projection template is also often required when applying for commercial loans or through other channels such as outside investors or crowdfunding.
5-Year Forecast Template
3. Budget Sales Forecast Template
A budget sales forecast template shows expense estimates in relation to revenue to calculate how much you will be able to spend during a specified period of time. Budget templates allow you to enter income projections and available cash to indicate your spending capabilities for that period of time.
Budget forecast template example
Budget forecast template for services example
This type of template is best for new and growing businesses trying to figure out their future available expenditures. Additionally, businesses interested in making a large asset purchase, such as a company vehicle, piece of equipment, or commercial real estate, can use this template to see how much of the asset can be self-financed.
FREE Budget Sales Forecast Template
4. Month-to-Month Sales Forecast Template
The month-to-month (or monthly) sales projection template shows sales projections for a year divided into monthly increments. This type of revenue forecast template makes it easier to estimate your incoming revenue. This is because you can break down your pricing model, such as the average number units sold, on a monthly rather than an annual basis.
Month-to-month forecast example
This template is best for seasonal businesses that experience significant revenue fluctuations in some months compared to others. It’s also appropriate for businesses that want to view rolling 12-month projections as a key performance indicator (KPI). You can also use it to project one-year sales estimates before implementing major campaigns or initiatives, such as a growth strategy.
FREE Month-to-Month Forecast Template
5. Individual Product Sales Forecast Template
An individual product sales projection template can be used by businesses that sell one product or service or for projecting sales of a new (or any single) product or service. This forecast indicates how you expect the product to perform based on units sold and the price per unit monthly.
Individual product forecast example
An individual product forecast template benefits businesses that sell a product either through a storefront or ecommerce medium. It is useful for current businesses adding a new product to their arsenal that want to estimate sales exclusively for that product. It is also recommended for companies that need to track individual performance for the most popular or most profitable products.
FREE Individual Product Forecast Template
6. Multi-product Sales Forecast Template
This revenue projection template can be used to generate sales projections for a business that sells multiple products. Through this type of template, you can compare the estimated performance of distinct products by tracking the units sold and the price per unit. This will, in turn, yield a total sales revenue estimate.
Multi-product forecast example
The multi-product sales forecast template is best for retail or wholesale businesses selling a variety of products. It can also be used to project revenue of multiple product categories. Here, each “Item” represents a category rather than an individual product, and price per unit is calculated in aggregate.
FREE Multi-product Forecast Template
7. Retail Sales Forecast Template
A retail sales projection template projects revenue for brick-and-mortar stores since it includes data related to foot traffic. The retail sales template calculates projected revenue by year based on foot traffic, the percentage of foot traffic that enters the store, and the percent of those who convert (make a purchase). Since it has a field for “other revenue,” it can be used by retail stores that also sell online.
Retail forecast example
This template is mostly designed for brick-and-mortar retail businesses. However, combination ecommerce and brick-and-mortar businesses, as well as ecommerce operations, can also use this forecast template. The estimated customers passing store data field can be replaced with website traffic to convert this sales forecast Excel sheet into an ecommerce sales forecasting template.
FREE Retail Forecast Template
8. Subscription-based Sales Forecast Template
Businesses that rely on recurring revenue from sign-ups or contract renewals should use the subscription-based sales projection template. Enter data into the visitor and sign-up fields to show the visitor-to-sign-up conversion rate. Then, enter the number of new customers to show the percentage of sign-ups that convert to paying customers.
This template also helps you track customer churn. It calculates your churn and retention rate based on the number of paying customers at the end of the period compared to the number at the beginning, plus the number of new customers added. Knowing your churn rate is essential, since a high or increasing rate of customer turnover could indicate problems with your organization or its products or services.
How to Calculate Churn Rate:
To manually calculate churn rate, divide the number of lost customers by the total customers at the start of the time period, then multiply the result by 100. For example, if your business had 200 customers at the beginning of January and lost 12 customers by the end, you would divide 12 by 200. The answer is 0.06. Then, multiply that by 100, giving you a 6% monthly churn rate.
Churn Rate Calculator
Manual calculation of monthly customer churn rate
Subscription-based forecast example
The fields of this template can be altered for use by contract renewal businesses like insurance agencies, information technology (IT) companies, and payroll processors. For example, subscribers can be replaced with “leads” and new subscribers can be replaced with “presentations,” “free trials,” or “demos.” Then, change the churn rate to “non-renewed contracts” and you’ll be able to estimate new and recurring business revenue year-to-year.
FREE Subscription-based Forecast Template
9. B2B Lead Sales Forecast Template
A business-to-business (B2B) lead forecast template is used to estimate sales revenue from current deal opportunities in the sales pipeline through business leads. Businesses can use estimated deal values and the percent chance of closing those deals to obtain a sales projection.
B2B lead forecast example
This template is best for B2B organizations, aka businesses selling to other businesses or organizations, rather than business-to-consumer (B2C) organizations. It can also be used for direct sales prospecting activities and for businesses that submit business proposals in response to solicitation requests.
FREE B2B Lead Forecast Template
CRMs With Built-in Sales Forecasting Features
Spreadsheet-based templates are easy to modify. However, customer relationship management (CRM) systems generally offer more robust tools for managing revenue opportunities that can be converted into sales forecasts. They can be a valuable tool for providing sales predictions on premade charts through the data collected in the system. Below are examples of CRM platforms with built-in sales forecasting features.
- HubSpot CRM
HubSpot CRM can instantly create revenue projections or automatically produce these reports for you monthly or quarterly at no additional cost, saving you time and helping your business stay on track.
Users can easily generate sales prediction reports on HubSpot with their historical data. (Source: HubSpot )
Starting price: Free for unlimited users or $45 per month (annual billing) for two users
Visit HubSpot
Pipedrive can take information such as potential deal value and probability of closing for a lead or opportunity to provide sales estimates in highly customizable templates.
Pipedrive weighted deal forecasting (Source: Pipedrive )
Starting price: $14.90 per user, per month (annual billing)
Visit Pipedrive
Zoho CRM provides sales forecasting through its native integration with Zoho Analytics, which analyzes and visualizes the data. Users can customize their forecasts by viewing them on different visual channels, including line, bar, and scatter charts.
Zoho Analytics sales prediction (Source: Zoho )
Starting price: Free for three users or $14 per user, per month (annual billing)
Providing the right tools for your sales team to organize leads, communicate with prospects, and analyze sales data is crucial for streamlining a sales operation, one of many responsibilities of a sales manager. Other insights for managing your sales team can be found in our ultimate guide to sales management .
Visit Zoho CRM
How to Create a Custom Sales Forecast Template
Due to your personal preferences or having a unique business model, you may want to create your own sales forecast template for estimating future business revenues. Creating it requires you to consider your business model, forecast purpose, and sales process to design an easily fillable template. Here’s a step-by-step guide for creating a custom forecast template for your business:
1. Establish Your Source of Sales
First, establish your sources of sales revenue. This is determined based on your business model, and essentially refers to how your business makes money through sales of products or services. Below are some common examples of pricing methods a business can use to make money:
- Price per unit or product
- Subscription pricing (monthly or annual)
- Hourly rate
- Price per project or deliverable
Pro tip: Your business can use one or multiple methods for making money. More information and strategies about pricing for your business can be found in our guide on how to price a product .
2. Determine the Purpose of Your Sales Forecast
The type of sales forecast you need will depend heavily on your purpose or reason for generating the estimate. For example, to obtain a loan, you’ll likely need a long-term sales prediction for underwriting. If you want to know how much money your business can plan to spend throughout the next year, you’d make a budget sales forecast. Alternatively, you would make an individual product forecast template to track sales of a new product or service.
3. Identify Sales Activities
Next, determine the ways and how many leads or potential customers enter and move through your sales process. For example, your business may use online forms to get new leads into your sales pipeline and then a series of tactics that convert a percentage of leads into clients. Your business could rely on foot traffic, in which a certain average number of people enter your store each day, and of those, an average number make a purchase.
If your business sells via ecommerce, you might use marketing tactics like website ads to attract site visitors. Here, a percentage or the average number of prospects decide to buy based on what they learn on your site or special offers rendered. Regardless of your specific activities, you need to know how many leads move through each stage of your sales funnel process . Some of these numbers will be needed to calculate your projections.
4. Collect Data
Once your business model, forecast purpose, and sales activities are identified, compile information based on historical data or industry standards. Information about your prices (per unit, per hour, and so on) are estimated business generated in terms of products sold or hours billed, and sales funnel data.
Sales funnel data refers to the rates of potential customers or leads moving to the next stage until they are paying customers. This information allows you to make estimates for future sales revenue based on the percentages of leads that move through each stage of the funnel, and which ultimately convert.
For example, assume 100 leads are generated, and you are measuring the qualifying rate of those leads in terms of demos set up. If 14 leads agree to a demo, your qualifying rate is 14%. Then of those 14, five agree to receive a proposal, making your conversion rate to the proposal stage 5%. Then, of the five remaining, two of them sign the contract and become clients, giving you a closing rate of 2% at the end of the funnel.
5. Create Your Spreadsheet to Project Sales
Now you’re ready to create a custom forecast template spreadsheet for your business. To use our example, you need to know things like the average number of opportunities (in this case, web traffic) as well as the average percent who make a purchase. In addition, enter the average number of units per purchase (or average dollar amount of purchases), and average price per unit to calculate your estimates.
We recommend using Excel or Google Sheets and create data field headers and cell functions as shown in the example below to automatically calculate projections:
Note: In the calculation examples shown above, such as those in the bottom row for “Estimated Sales,” the letter refers to the column and the number refers to the row. So (B4*B5)*B6 would mean Column B Row 4 (60 visitors who purchase) multiplied by Column B Row 5 (three items purchased on average) and then multiplying that by Column B Row 6 ($10 average price per unit).
Once your data fields are filled in and the cell calculation functions are created, further customize your business’ sales forecast spreadsheet with your preferred color schemes and data charts to better visualize the information. Both Excel and Google Sheets have premade templates for color schemes, charts, and graphs, as well as customization options.
Pro tip: Volunteering for sales management projects, including conducting sales forecasting and reporting activities, is one of our tips for advancing into a sales management role. For more career-advancing insights, read our step-by-step article on how to become a sales manager .
Bottom Line
Sales forecasting templates are available in both Excel and Google Sheets templates as well as other premade templates you can download, customize, and use. You may also take advantage of CRM features that organize, estimate, and visualize your company’s sales information, including sales predictions.
A CRM can save sales reps time in making projections as well as optimizing your sales pipeline to generate more leads and close more deals. We highly recommend CRMs such as HubSpot CRM, Pipedrive, and Zoho CRM, which all provide excellent sales forecasting features on top of robust sales management and lead nurturing tools.
About the Author
Find Bianca On LinkedIn
Bianca Caballero
Bianca Caballero is a subject matter expert at Fit Small Business who covers Sales and Customer service topics. Prior to working at FSB, she was in field sales and territory management. When she launched her career as a writer, she worked with companies from the US, Australia, and China. She gained expertise in writing and editing news, health, technology, and business articles. At present, she uses her decade-long writing experience to provide FSB readers with the best answers to their questions.
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Financial plan template
This financial plan template is designed to help you make projections for the coming months, forecasting income and expenses.
These projections will help you plan your growth and obtain the financing you need. They can also be used as a tool for monitoring your finances, allowing you to measure your progress and quickly react if there is a sign of trouble.
Why use a financial plan template?
This financial plan template will help you make projections for the coming months, forecasting income and outlays. Your projections will act as an early warning system, helping you to plan for cash flow dips, identify financing needs and pinpoint the best timing for projects.
It also gives you a tool for monitoring your finances, allowing you to gauge your progress and quickly head off trouble.
How will the financial plan template help me?
BDC’s free financial plan template is meant to serve as a model you can follow to list past performances and create future projections on the following indicators:
- costs of sales
- income statement
- statement of financial position
- financial requirements
- performance indicators
Fill in the form to get your template. It’s 100% free.
Terms and conditions.
We allow you to use these templates only as part of your business activities, but we do not guarantee that they fit your needs.
Unfortunately, we do not offer any assistance.
You are responsible for the content of the documents you create using these templates. We are not responsible for the value or accuracy of these documents, nor for the damages resulting from their use.
If you do not agree with what you just read, do not use the templates.
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Free Business Plan Template With Examples for Small Businesses (2023)
- by Desirae Odjick
- Starting Up
- Nov 9, 2022
- 11 minute read
A business plan is the secret to starting a business successfully.
The easiest way to simplify the work of writing a business plan is to start with a business plan template.
You’re already investing time and energy in refining your business model and planning your launch—there’s no need to reinvent the wheel when it comes to formatting your plan. Instead, to help build a complete and effective plan, lean on time-tested structures created by entrepreneurs and startups who have come before you.
Free: Business Plan Template
Business planning is often used to secure funding, but plenty of business owners find writing a plan valuable, even if they never work with an investor. That’s why we put together a free business plan template to help you get started.
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What our business plan template includes
This template is designed to ensure you’re thinking through all of the important facets of starting a new business. It’s intended to help new business owners and entrepreneurs consider the full scope of running a business and identify functional areas they may not have considered or where they may need to level up their skills as they grow.
That said, it may not include the specific details or structure preferred by a potential investor or lender. If your goal with a business plan is to secure funding , check with your target organizations—typically banks or investors—to see if they have business plan templates you can follow to maximize your chances of success.
Our free business plan template includes seven key elements typically found in the traditional business plan format:
- Executive summary: This is a one-page summary of your whole plan, typically written after the rest of the plan is completed. The description section of your executive summary will also cover your management team, business objectives and strategy, and other background information about the brand. You may consider including a mission statement here.
- Market analysis: A well researched business plan should also analyze the market you hope to reach with your business idea. This section includes everything from estimated market size to your target markets and competitive advantage. It’ll include a competitive analysis of your industry to address competitors strengths and weaknesses.
- Products and services: What you sell and the most important features of your products or services. It’ll also include any plans for intellectual property, like patent filings or copyright. If you do market research for new product lines, it’ll show up in this section of your business plan.
- Marketing plan: How you intend to get the word out about your business, and what strategic decisions you’ve made about things like your pricing strategy. It also covers potential customers’ demographics, sales plan, and your metrics and milestones for success.
- Logistics and operations plan: Everything that needs to happen to turn your raw materials into products and get them into the hands of your customers.
- Financial plan: It’s important to include a look at your financial projections, including both revenue and expense projections. This section includes templates for three key financial statements: an income statement, a balance sheet, and a cash-flow statement . You can also include whether or not you need a business loan and how much it’ll be.
In our business plan template, each section includes an overview of the most important information to cover and guidelines on how to approach writing and researching each one.
Professional business plan example
We’ve filled out a sample business plan as a companion to our template, featuring a fictional ecommerce business . We’ve noted where—and how—an entrepreneur could add more details to expand on their business plans, depending on their goals.
Our fictional business creates custom greeting cards with your pet’s paw prints on them, and the founder of the business is writing a plan to help understand the target market, as well as the logistics and costs involved, to give themselves the best chance of success before they launch.
The sample is set up to help you get a sense of each section and understand how they apply to the planning and evaluation stages of a business plan. If you’re looking for funding, this example won’t be a complete or formal look at a business plan, but it will give you a great place to start and notes about where to expand.
Before you write your own, read through the following business plan example . You can download a copy in Microsoft Word or Google Docs and use it to inspire your own planning.
Download the business plan example (.doc)
Lean business plan example
A lean business plan format is a shortened version of your more detailed business plan. It’s helpful when modifying your plan for a specific audience, like investors or new hires.
Also known as a one-page business plan, it includes only the most important, need-to-know information, such as:
- Company description
- Key members of your team
- Customer segments
- Marketing plan
Want to create a lean business plan? Read Trimming It Down: How to Create a Lean Business Plan .
A good business plan helps you operate successfully
It’s tempting to dive right into execution when you’re excited about a new business or side project, but taking the time to write a solid business plan and get your thoughts on paper allows you to do a number of beneficial things:
- Test the viability of business ideas. Whether you’ve got one business idea or many, business plans can make an idea more tangible, helping you see if it’s truly viable.
- Plan for your next phase. Whether your goal is to start a new business or scale an existing business to the next level, a business plan can help you understand what needs to happen and identify gaps to address.
- Clarify marketing strategy, goals, and tactics. Writing a business plan can show you the actionable next steps to take on a big, abstract idea. It can also help you narrow your strategy and identify clear-cut tactics that will support it.
- Scope the necessary work. Without a concrete plan, cost overruns and delays are all but certain. A business plan can help you see the full scope of work to be done and adjust your investment of time and money accordingly.
- Hire and build partnerships. When you need buy-in from potential employees and business partners, especially in the early stages of your business, a clearly written business plan is one of the best tools at your disposal. A business plan provides a refined look at your goals for the business, letting partners judge for themselves whether or not they agree with your vision.
- Secure funds. Seeking financing for your business—whether from venture capital, financial institutions, or Shopify Capital —is one of the most common reasons to create a business plan.
Should you use a template for a business plan?
A business plan can be as informal or formal as your situation calls for, but even if you’re a fan of the back-of-the-napkin approach to planning, there are some key benefits to starting your plan from an existing outline or template.
- No blank-page paralysis. A blank page can be intimidating to even the most seasoned writers. Using an established business planning process and template can help you get past the inertia of starting your business plan, and it allows you to skip the work of building an outline from scratch. You can always adjust a template to suit your needs.
- Guidance on what to include in each section. If you’ve never sat through a business class, you might never have created a SWOT analysis or financial projections before. Templates that offer guidance—in plain language—about how to fill in each section can help you navigate sometimes-daunting business jargon and create a complete and effective plan.
- Knowing you’ve considered every section. In some cases, you may not need to complete every section of a startup business plan template, but its initial structure shows you you’re choosing to omit a section as opposed to forgetting to include it in the first place.
Tips for creating a successful business plan
There are some high-level strategic guidelines beyond the advice included in this free business plan template that can help you write an effective, complete plan while minimizing busywork.
- If you’re writing a business plan for yourself in order to get clarity on your ideas and your industry as a whole, you may not need to include the same level of detail or polish you would with a business plan you want to send to potential investors. Knowing who will read your plan will help you decide how much time to spend on it.
- Know your goals. Understanding the goals of your plan can help you set the right scope. If your goal is to use the plan as a roadmap for growth, you may invest more time in it than if your goal is to understand the competitive landscape of a new industry.
- Take it step by step. Writing a 10- to 15-page document can feel daunting, so try to tackle one section at a time. Select a couple of sections you feel most confident writing and start there—you can start on the next few sections once those are complete. Jot down bullet-point notes in each section before you start writing to organize your thoughts and streamline the writing process.
Once you’ve done the strategic work, it’s time to put it into action and write your plan. Download the business plan template and review our guide on writing a business plan for additional information.
Maximizing your business planning efforts
Planning is key to the financial success of any type of business , whether you’re a startup, non-profit, or corporation.
To make sure your efforts are focused on the highest-value parts of your own business planning, like clarifying your goals, setting a strategy, and understanding the target market and competitive landscape, lean on a business plan outline to handle the structure and format for you. Even if you eventually omit sections, you’ll save yourself time and energy by starting with a framework already in place.
Illustrations by Rachel Tunstall
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Business plan template faq, what is the purpose of a business plan, how do i write a simple business plan.
- Choose a business plan format, such as traditional or a one-page business plan.
- Find a business plan template.
- Read through a business plan sample.
- Fill in the sections of your business plan.
What are the 7 sections of a business plan?
- Executive summary
- Market analysis
- Products and services
- Marketing strategy
- Logistics and operations plan
- Financial statements and projections
What is the best business plan template?
What are the 5 essential parts of a business plan.
- Executive Summary : This is a brief overview of the business plan, summarizing the key points and highlighting the main points of the plan
- Business Description : This section outlines the business concept and how it will be executed
- Market Analysis : This section provides an in-depth look at the target market and how the business will compete in the marketplace
- Financial Plan : This section details the financial projections for the business, including sales forecasts, capital requirements, and a break-even analysis
- Management and Organization : This section describes the management team and the organizational structure of the business
How do you write a business plan?
- Executive Summary : Provide a concise overview of your business, products/services, goals, and plans for achieving those goals
- Company Description : Explain the type of business you are in, where you are located, and what you offer
- Market Analysis : Research your industry, target market, and competitors to gain insight into the opportunities and threats that may affect your business
- Organization and Management : Describe the organizational structure of your business, including management, employees, and advisors
- Service or Product Line : Explain what products or services you offer, how they are unique, and how they will meet the needs of your customers
- Marketing and Sales : Describe how you plan to market and sell your products/services, including pricing strategy, advertising and promotions
- Funding Request : Explain the capital you need to start or expand your business, how you plan to use it, and how you plan to pay it back
- Financial Projections : Provide an estimate of your anticipated income and expenses over the next three to five years
- Appendix : Include any additional information that will support your business plan, such as resumes, leases, contracts, and product samples
About the author
Desirae Odjick
Desirae is a senior product marketing manager at Shopify, and has zero chill when it comes to helping entrepreneurs grow their businesses.
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5-Year Financial Plan Template
Whether you are already running a business, or making plans to start one up, financial planning is a vital part of ensuring your success. Not knowing your expected income and expenditure will make it difficult to plan, and hard to find investors.
This 5-Year Financial Plan spreadsheet will make it easy for you to calculate profit and loss, view your balance sheet and cash flow projections, as well as calculate any loan payments you may have. Whilst the wording on this spreadsheet is focussed around products, it can just as easily be used for businesses who largely provide services to their customers.
5-Year Financial Plan Projection
How to use Financial Plan
Model inputs.
Use the Model Inputs sheet to enter information about your business that will be used to model results seen on the other pages.
Forecasted Revenue
The forecasted revenue section allows you to estimate your revenue for 4 different products. Simply use the white boxes to enter the number of units you expect to sell, and the price you expect to sell them for, and the spreadsheet will calculate the total revenue for each product for the year. If you want to give your products names, simply type over the words "Product 1", "Product 2" etc. and these names will be carried through to the rest of the spreadsheet.
Cost of Goods Sold
Your margins are unlikely to be the same on all of your products, so the cost of goods sold allows you to enter your expected gross margin for each product into the white boxes in Column B. The spreadsheet will automatically calculate the annual cost of goods sold based on this information, along with your forecasted revenue.
Annual Maintenance, Repair and Overhaul
As the cost of annual maintenance, repair and overhaul is likely to increase each year, you will need to enter a percentage factor on your capital equipment in the white box in Column B. This will be used to calculate your operating expenses in the profit and loss sheet.
Asset Depreciation
Use the white box to enter the number of years you expect your assets to depreciate over. This may vary greatly from business to business, as assets in some sectors depreciate much more quickly than they do in others.
In most parts of the world, you will have to pay income on your earnings. Enter the annual tax rate that applies to your circumstances in the white box in Column B. If you have to pay any other taxes, these can be entered later on the Profit and Loss sheet.
Although you cannot be certain of the level of inflation, you will still need to try and plan for it when coming up with a 5-year financial plan. The International Monetary Fund provide forecasts for a number of countries, so is a good place to look if you are unsure what to enter here. Simply enter your inflation rate in the white box.
Product Price Increase
As a consumer, you are no doubt aware that the price of products goes up over time. Enter a number in the white box to show the expected annual price increase of your products to enable the spreadsheet to calculate income in future years. If you are unsure what to put here, increasing your product price in line with inflation is a good starting point. If your business is just starting out, you may be able to command higher prices for your products or services as the years go on, as you build up brand recognition and a good reputation.
The funding section allows you to enter information about your business loan. To use this section, simply fill in the three white boxes representing the amount of the loan, the annual interest rate and the term of the loan in months - for example, 12 for 1 year, 24 for 2 years, 36 for 3 years, 48 for 4 years, or 60 for a 5 year loan.
Profit and loss
This sheet calculates your profit and loss for each year over a 5 year period. The profit and loss assumptions, along with income, are automatically calculated using information entered in the model inputs sheet.
Non-Operation Income
You may have, or be expecting some income in addition to your operating income. These can be entered manually in the white cells in Column B for Year 1, Column C for Year 2 and so on. There are pre-entered categories for rental, lost income and loss (or gain) on the sale of assets, as well as an additional row where you can enter your own non-operation income.
Operating Expenses
Some parts of this are already filled in based on information you put on the Model Inputs, for example, depreciation, maintenance and interest on long-term debt. Years 2-5 are also filled in for you across all categories based on the inflation information entered in the Model Inputs sheet. You therefore only need to enter your Sales and Marketing, Insurance, Payroll and Payroll Tax, Property Taxes, Utilities, Administration Fees and any Other Expenses into the white cells in Column B for Year 1.
Non-recurring Expenses
This section is for entering any expenses that you will not be paying on an annual basis. The Unexpected Expenses row allows you to enter a contingency for unexpected expenses, whilst the Other Expenses row allows you to enter any other one off expenses you may be expecting to make, for example the purchase of new equipment part way into your 5 year plan.
Income Tax is filled in based on the information you enter into the model inputs. Depending on where your business is based, you may find yourself having to pay other taxes. These can be entered in the Other Tax row. You can rename this row by typing over the "Other Tax (specify)" text.
Balance Sheet
The annual balances for Years 1-5 are, in most cases, filled in for you, based on the information you have entered on the Model Inputs sheet and in the Initial Balance column of the Balance Sheet column itself. This makes it very easy to use.
Current Assets
This is where you can enter the value of any of your current assets, with spaces to enter information about Cash and Short-term Investments, Accounts Receivable, Inventory, Prepaid Expenses and Deferred Income Tax. At the bottom of this section is a space for you to enter any other current assets you may have that do not fall into any of these categories.
Property and Equipment
Depending on the nature of your business, you may have assets such as Buildings, Land, Capital Improvements and Machinery. Enter the value of these assets into Column B, and these values will be copied over to each of the 5 years of the plan. The depreciation information entered into the Model Inputs sheet will be used to calculate the depreciation expenses, which allows a total for property and equipment to be calculated automatically.
Other Assets
This section is for entering information on any assets that don't fit in the other sections. These could be Goodwill Payments, Deferred Income Tax, Long-term Investments, Deposits, or any Other long-term assets. Enter the information into Column B, and it will be carried across to the yearly columns automatically.
Current Liabilities
As well as assets, your business is likely to have liabilities. There are spaces to enter Accounts Payable, Accrued Expenses, Notes Payable and Short-term Debt, Capital Leases and Other current liabilities. Just leave blank any rows where you do not have any liabilities, and the totals will be calculated for you.
Your long-term debt/loan information will have already been entered in the Model Inputs sheet, so the only thing to do here is to enter any other long-term debt. Unlike much of the rest of the Balance Sheet, you can manually enter different amounts for each year, as you may, for example, be expecting to take on another loan to purchase some new equipment in Year 3 as your business expands.
Other Liabilities
Use this section to enter any liabilities not covered by the pre-defined labels. You can amend the text in Column A, in order to specify the liabilities, and then enter the cost of these liabilities in Column B.
Your business is likely to have some equity, and this can be entered into this section. You can fill out the Owner's Equity, Paid-in Capital and Preferred Equity in Column B. Your retained earnings are automatically calculated based on the Profit and Loss sheet.
Much of the information on the cash flow sheet is based on calculations in the Balance Sheet. It is important to plan your cash flow carefully, so that you know what funds you will have available to buy new stock and equipment.
Operating Activities
Much of this section is automatically filled in based on your balance sheet. There are only three rows to fill out, which are Amortization, Other Liabilities and Other Operating Cash Flow. You only need to fill out the white boxes in Column B for Year 1, as these values will automatically be carried over into subsequent years for you.
Investing Activities
Your capital expenditures and sale of fixed assets will be automatically populated if you have filled out the relevant sections of the Balance Sheet. They will be blank if they do not apply. As investing activities can vary year on year, you will need to fill out any investment activities for each of the 5 years in the appropriate columns for Acquisition of Business, and any Other Investing Cash Flow items.
Financing Activities
The long-term debt/financing row will be pre-filled based on the loan information previously entered. Use Column B to fill out your Preferred Stock, Total Cash Dividends Paid, Common Stock and Other Financing Cash Flow items for Year 1. This information will automatically carried over to Years 2-5.
Loan Payment Calculator
There is nothing to enter on this sheet, as it is for information only. Whether or not you already have a loan, or are using this spreadsheet as a part of a business plan to help you obtain one, it allows you to easily see how much you will be paying each month, showing how much you are paying off your loan, and how much you are paying in interest. This will allow you to get an idea of whether or not you can afford to borrow a bit extra, if you feel it would allow you to push your business into higher places, or whether you need to shop around for a better interest rate or adjust the loan term in order to afford the loan payments.
Related Content
Related templates.
8 Best Sales Forecast Templates (Excel & Google Sheets) + How to Forecast Sales in 2023
Sales forecasting templates might not sound all that exciting. That's fair. But, imagine this scenario with two sales managers:
What's the difference? (Other than one is likely to get a budget to hire more reps and one won't.)
A solid sales forecast.
You were hoping it would be a little more exciting, right?
Sales forecasting is exciting—because it gives you the superpower to see what is coming down the pipe. More importantly, they're pretty easy to create using the right sales forecasting template.
In this post, we'll give you a step-by-step method to create a sales forecast and access to several free sales forecasting templates (in both Microsoft Excel & Google Sheets format) that we love.
But first, let’s dive a bit deeper into why sales forecasts are crucial to growing your sales team—and your business.
What is a Sales Forecast?
When done right, sales forecasting helps businesses allocate resources, estimate costs, and predict whether they'll reach short and long-term business goals.
For example, a start-up might use a sales forecast to determine whether they'll reach end-of-quarter revenue goals or see if they need to hire more sales reps.
The challenge is, sales forecasts are only as useful as they are accurate—which is why so many teams use a sales forecast template that standardizes the process and makes it easier to find important sales insights.
Why Are Sales Forecasts Crucial for Sales Teams?
Sales forecasting provides a little window into your business's future. You can see whether you'll reach your quarterly goal and track sales rep and overall sales team performance . That data makes it easier to see whether you're on track or your strategy needs adjusting.
Imagine you're the sales manager of a SaaS company and want to know whether you will hit your revenue goals or if you need to hire more sales reps.
Based on your sales forecast, you notice you're generating 10% fewer leads. That means it's time to scale up your lead generation efforts and maybe hire more SDRs.
Sales forecasting also provides clear insights into revenue, costs, and where you should invest more money.
Depending on the sales forecasting template, you might also get access to:
- More accurate cash flow projections
- Predict expenses
- See where to invest marketing dollars
- Better allocate hiring budgets
- Spot emerging trends early
- See potential issues in your sales flow early
Lastly, it is a powerful motivation tool for your sales team — especially if you have a longer sales cycle. It allows you to paint a clear picture showing how the work your team is doing today will pay off.
How to Forecast Sales in 4 Easy Steps
The truth is sales forecasting can be quite simple — if you follow a step-by-step process and use a sales forecasting template.
We broke the process down into 4 easy-to-follow steps you can use to build a great forecast for your business. If you need a quick and fast solution, this will get the process going.
Step 1: Calculate Your Sales Run Rate
The simplest way to get a rough revenue forecast is to calculate revenue if your sales continue at the exact same rate going forward.
To get this number, divide your current year-to-date sales by the number of sales periods to date.
Say you made $120,000 through March 30. You'd divide $120,000 by 3 months and see that you're generating $40,000 per month. That’s your run rate.
Then, multiply that monthly number by the remaining sales periods in the year for your annual projection. In this example, it would be $40,000 * 9 months left in the year.
This tells you $360,000 is the sales volume you can expect through the end of the year — if you change nothing about your business. Here's the sales run rate formula to help forecast your projected sales:
This is one of the easiest ways to predict future growth, but it's not super accurate. This formula doesn't consider seasonality, competition, market changes, or business growth or decline.
This is a good starting point; it just needs to be refined a bit.
Step 2: Adjust for Historical Trends and Seasonality in Your Sales Performance
Look at the previous 12-24 months' sales, paying special attention to spikes and dips. For example, if your business sells clothing to consumers, you likely see a huge spike around Black Friday and Cyber Monday, and a dip in the summer.
According to Adobe, consumers spent USD 9 billion on Black Friday . That’s not an average day by a long shot.
If seasonality or trends impact your sales, calculate the percent increase from your average month during periods of spike or dip. For example, if your sales typically spike by 30% in November, adjust your sales run rate to account for these trends.
Don't sweat it if you don’t have historical data or seasonality in your business yet. Just skip this step.
Step 3: Modify Your Sales Forecast for Anticipated Market Trends and Changes
Changes in overall market growth rate, consumer behavior, and emerging trends can have a huge impact on sales.
For example, if you sell in the natural health market, and the industry is projected to grow by 23%, that can be a benchmark for your growth rate.
Double that is really aggressive. It’s possible with a great closing system , but everything has to go right. On the other hand, a 10% growth projection might be too low.
Consider market trends and your competitors, then add these calculations to your sales forecast. This will provide a more accurate picture of what the future holds.
Step 4: Account for Your Firm’s Strategic Business Plans
The outside world isn't the only factor that impacts growth. Internal changes can also affect sales forecasting.
Are you launching new products ? How have product launches performed in the past? Are you marketing to new customer segments? How many new customers do you expect these new markets to add to your customer file?
Are prices changing? How might these impact your sales?
All of these changes can impact future revenue, making them important considerations for your sales plan .
Once you’ve included everything in steps 1-4, you’ve got the bones of a great sales forecast.
To consider more advanced trends and metrics (or if you don't have much historical data), there are more advanced sales forecasting methods.
That's where the right sales forecasting template comes into play.
How to Choose the Right Sales Forecast Template (& Forecasting Methods for Your Business)
The right sales forecasting template provides access to the sales metrics and KPIs that matter most to your sales team. The challenge is not all businesses are the same.
Retail businesses may need to track hundreds of products and dozens of different suppliers, while a SaaS company might only offer three plans but have a really long sales cycle.
Finding the right template for your business needs is crucial. Otherwise, you'll be left floundering in a sea of useless data.
Here's how to select the right sales forecast template for your organization.
Get Clear on Your Sales Goals (& Set Realistic Sales Revenue Targets)
Different sales goals and revenue targets rely on different data. For example, if you want to predict sales over the next two years, you'll want a sales forecast template that covers a longer time period.
Goals can also impact which template will work best for your team.
For example, suppose an eCommerce company wants to increase monthly sales by 10% and increase customer lifetime value. In that case, they'll need a different template than a small business looking to increase sales in a specific customer segment.
Next, set realistic revenue targets based on overall market growth. If your industry is expanding by 25%, a 10% growth rate might be too low, while 50% is likely too high.
As you review the templates below, look for one that fits your business goals and revenue targets.
Consider Your Business Type (& Plan Ahead for Sales Fluctuations)
Your business type is one of the most important factors to consider when selecting the right sales forecasting template. The size, industry, age, and rate of growth can all impact which template will work for you.
Also, consider how often your sales fluctuate. For example, an eCommerce store may have ten to fifteen fluctuations a year, so they need a template that can handle their data. On the other hand, a small fly fishing business may have just two fluctuations—on and off-season.
As you look at the sales forecasting templates below, look for one that fits your business model and can handle your sales fluctuations.
Decide Which Method of Sales Forecasting to Use for Your Sales Team
When it comes to sales forecasting methods, there is no one-size fits all solution.
You'll need to adjust your sales forecasting method based on your historical data, the key metrics you need to track, and your confidence in the data. Goals and KPIs also impact the forecasting methods you use.
Here are seven sales forecasting methods, including who should use them:
- Lead-driven forecasting : Looks at previous lead conversion rates and projects future sales based on current lead volume. Best for businesses with clear historical data and a steady stream of inbound leads, such as SaaS or technology companies.
- Length of sales cycle forecasting : Tracks how long it takes a typical lead to close based on lead type. Best for organizations with insights into the entire sales pipeline and well-aligned sales and marketing teams, especially B2B.
- Opportunity stage forecasting: Calculates how likely a lead is to close based on specific actions and lead type. Ideal for businesses with good historical data on closing rates.
- Test-market analysis forecasting: Leverages data from a soft release to get a sense of projected revenue. Best for startups or businesses launching a new product line or service.
- Historical forecasting : Forecasting data based on historical data and market trends. Works well for any business with at least a year of historical data.
- Multivariable analysis: A complex analysis that considers multiple factors and closing ratios. Best for companies with varying deal sizes and close rates or selling multiple products or services.
As you look at the sales forecasting templates in the next section, make sure they fit the analysis method you use.
Look at Historical Data & Past Sales Metrics
We've already talked about how historical data can impact your sales forecasting, but it's also an important factor in choosing the right sales forecasting template.
Before choosing a template, take a look at your past metrics and historical data. How much data do you have? If you have several years worth of data, consider a template with a longer forecasting model.
What data do you want to include based on your business type and forecasting methods? Make sure the template you choose includes the fields important to your business.
Research External Market Conditions to Create an Accurate Sales Forecast
Finally, spend a few hours researching current market conditions and consider how they may impact your sales forecast. For example, if your industry is growing fast, you might select a forecasting template that updates in near real-time.
On the other hand, if a large competitor is acquiring another company, that might make growth more challenging, and you might need to lower your growth expectations.
As you look at the templates below, look for a template that works well with current market conditions.
8 of the Best Sales Forecast Templates for Your Team (Free Google Sheets & Excel Templates)
We started this with a list of 8 different templates. The reality is, not every sales team needs a super complex sales forecasting model. Some, like a small businesses, just want to track a few metrics.
Other companies, like eCommerce, need to track multiple products, which can be impossible with a simple template.
To make your life easier, we've sorted through all the free sales forecast templates we could find (in Excel format) and created one of our own. Choose the Excel (or Google doc) template that works best for your company, sales team, and industry.
1. Best General Sales Forecast Template (Without a CRM Like Close)
This sales forecasting template from Close provides a simple way to track and forecast two years of sales. The first tab allows for adjusting funnel metrics by adjusting your sales cycle, average deal size, lead growth, and number of leads.
The second tab forecasts sales by month based on meetings booked, new opportunities, and closed or won leads. A chart at the bottom displays expected growth.
The only thing better is when you have forecasting built into your CRM (like with Close ), which enables you to have powerful integrations that can enrich your forecasting accuracy & pipeline health over time.
Get the free template here .
2. Best Sales Forecast Template for a Lead-Driven Sales Process
This template is ideal for companies that track their lead generation efforts and keep an eye on their monthly sales forecast.
The best part? This is a Google Sheets template (which can be accessed via Google apps and can also be downloaded for use in Microsoft Excel). You’ll see it breaks the year into quarters and tracks leads in all stages of the sales funnel .
It also tracks deal value and uses a weighted forecast model. It also tracks the probability of closing, which is ideal for B2B companies. You can download it right here .
3. Best Forecasting Template for Multiple Product Businesses
Does your company sell multiple products or services? This sales projection template could be a great choice for more complex offerings. It tracks sales over 12 months based on the number of units sold and multiple product lines all in one spreadsheet to streamline your forecasting accuracy.
It also carries over sales history from three previous years, making it easy to compare sales by unit, month, or across years. You can download this one right here in Google Sheets or Microsoft Excel format. Just make a copy and you will be able to edit the sheet.
4. Best Sales Forecasting Template for Retail Businesses
This template is ideal for retail stores that want to forecast sales, track gross sales, and mark up percentage and profit margin for each item with an eye on generating more new business. The yellow cells allow you to input your own data, and the spreadsheet uses smart Excel automation formulas to calculate the rest.
While it doesn't display previous year's data in this view, you could easily create a pivot table in Excel or Google Sheets to pull data from several years and compare average sales, total sales and other sales KPIs that matter to your leadership. You can pick this one up right here .
5. Best for Long-Term Future Sales Analysis (36 Months of Historical Data)
This is one of the most colorful templates on the list, but that's not why we included it. This template is ideal for companies that want to keep a close eye on long-term data.
In addition to 12 months of full historical sales data, you'll also see detailed insights & historical data for the past five years, including overall revenue for each type of item. This is a good option if you want to focus your sales analysis on the long and short term. You can grab this one right here .
6. Best Sales Forecasting Model for Scenario Planning (New Product Launches)
Forecasting sales for a new product launch can be a challenge—which is why many companies do a soft launch without too high of expectations at first.
After a soft launch, use this forecasting template to track your initial sales data and see where you can project total sales to be in the next five years. You can head over here and download this one .
7. Best for Projecting Increases in Marketing Costs
Ideally, sales increase every year, and you retain more customers than those that churn out.
But so do other costs, like marketing and administration. This sales forecast template tracks your sales for several products and forecasts out the next five years of revenue data.
On a second tab, it tracks income statements for the year and incorporates admin and marketing costs increases, providing a more holistic view of potential revenue. You can download this template for Google Sheets and Microsoft Excel right over here .
8. Best for Multiple Products at Different Growth Rates
Looking to track products that grow at different rates? This spreadsheet tracks the growth rate and forecasts revenue for 12 months, even if the products or services grow at different rates. This is a great fit for businesses with legacy products and regularly launch new products.
This forecasting chart also includes five years of historical data so you can see overall sales growth at a glance. You can pick this template up right here .
Final Thoughts: The Right Sales Forecasting Template Can Drive Long-Term Success
When it comes to sales forecasting, the right template can make all the difference. If you're still doing the process manually, you might miss out on actionable insights that could help your team meet your sales goals and exceed them.
Choose one of the templates above, but don't be afraid to make it your own. Add columns, include metrics that matter, and even plug in your brand color and name.
Over time, you'll end up with a custom sales forecasting spreadsheet that makes you look like a superstar. Want even more actionable insights? See how Close gives you access to the reporting metrics that matter .
Even if you’re working without a CRM—or using another product to manage your sales process, our Sales Success Kit will help your team achieve those goals that much faster.
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