Forecast and planning Answer 2 of 9

How accurate is the forecast?

It depends on your history, and the page measures it rather than promising it: every month ahead carries a likely range, the band where the outcome will probably land.

Once your store has a little over a year of orders, nouz runs the same method on past months, as of the day before each one began, and compares what it would have said about net revenue with what the month brought. With at least three such months, the likely range is where eight of ten of those past forecasts landed, and About this forecast shows the average miss over the recent months.

Before that, the range is an estimate and labelled as one: about a tenth of net revenue either way for next month, a little wider for each month further out, and about a quarter either way while the forecast runs on your last four weeks. The range on EBITDA follows from the range on net revenue.

What moves a forecast most is what it cannot know: a product launch, a price change or a big sale you have not told it about. Planned events and What if add those, and anything the forecast cannot price yet, such as products without a unit cost or a zone no rate card prices, is listed under About this forecast.

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More in Forecast and planning

All 9 questions
  1. 01 How is the forecast built?
  2. 02 How accurate is the forecast? You are reading this
  3. 03 How do What if scenarios work?
  4. 04 How do goals work on the Forecast?
  5. 05 How do I add a sale or a launch to the forecast?

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