From the course: Financial Analysis: Making Business Projections
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Creating a product-level projection - Microsoft Excel Tutorial
From the course: Financial Analysis: Making Business Projections
Creating a product-level projection
Another great tool at your disposal is to have a financial plan or even forecast done at the product level. One of the reasons is that you can use it as a goal for you to reach on each of the product or family of family of product you're selling. Another great reason is that most of the time products have a different gross margin profile which means that some products are more profitable than others. Sometimes even companies sacrifice most or all of their margin on a certain product and use it as a way to attract new customers with the objective of then selling them more profitable products. Since products have a different gross margin profile, that means that any change in performance on a given products will influence the profitability of your company. If you generate as much revenue this year as last year but do it by selling products that are less profitable, you will end up making less money. Let's talk briefly about how to prepare a product level projection since it is done on a…
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Contents
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Revenue projection basics1m 46s
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Preparing past P&Ls3m 40s
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Projecting revenue based on your resources5m 32s
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Adjusting for changes in productivity2m 12s
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Adjusting for changing resources2m 55s
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Detailing your plan by month using seasonality1m 52s
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Creating a product-level projection2m 39s
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Adding back exceptional elements using pipeline information2m 32s
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Market-driven forecasting2m 46s
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