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Why is the forecast of business development necessary

He started doing business at the University. The scholarship was not enough, so I was spinning to earn at least some money. I’ve never worked for my uncle, and I’m proud of it. All he has achieved. For 20 years, we have achieved a lot. At first, the business developed perfectly. I earned money, solved my problems. Everything was going great, so I didn’t even think about opening another business.

But lately there has been a sense of doom. It seems that a little more and the business will have to close. I don’t know what to do. If I shut down the business, I’d be virtually without income. Is it possible to define at least in General terms what to expect from business in the future? Is it possible to build a forecast of business development at least for 5-10 years ahead? Is it possible to know how much is left for my business?


The forecast of business development is the Foundation
The forecast of business development-it is like the Foundation of the house. It is customary to start any business with it. It is not only possible, but also necessary to build. Many companies, especially Western ones, are actively engaged in forecasting, and every year, because they understand that the situation in the market is dynamic, not static and sooner or later will end.

When the outcome of a situation and when to best “get up and walk away from the table” it’s better to know in advance. In our same culture adopted to live one day and on this expense there are many sayings: “will day – will food”, “questions need to to decide on least arise” and so on. Therefore, no one really builds forecasts, and if they do, it is purely formal, if only they were well, or if it is necessary to report to someone.

Most business problems are almost always related to the fact that the forecast of business development was not carried out

The result in 99% of cases is the corresponding – “and who is still there”. However, we are coming to a point when forecasting becomes relevant for us. This is due to the fact that the speed of change is increasing and it is necessary to adapt to this. Most business problems are almost always related to the fact that the forecast of business development was not carried out.

The forecast of business development is useful
The forecast of business development is useful

There are many examples, but I see dozens of them. For example, a sick new house was built opposite me. On the first floor of this house are located commercial premises. The total number of rooms is about 20. For about half of them, the owners have been looking for tenants for several years and can’t find them. The premises of course invested money, and quite serious, which actually turned out to be frozen.

I’m very interested in watching the signs change

The people who paid for them expected to have a good income from renting them out, but in fact have only costs. For the remaining premises, tenants have been found, but they are constantly changing. I’m very interested in watching the signs change. They will open a beer store, a grocery store, a children’s store, a candle store, a tourist company, a Barber shop, a sewing workshop.

Some work a week, some six months, but in the end still closed, and received serious losses. My trained eye immediately determines who will be able to hold on, and who will be closed very soon. If they had made a forecast of business development in advance, they would have realized that their business in the format in which it is, will not last long, and would have understood why.

Forecast of business development is necessary
Forecast of business development is necessary

One of the shops was on the verge of closing. It so happened that I went into it and gave some recommendations. Surprisingly, they listened to them and did what I said. As a result, the business only at the expense of these recommendations lasted another year. However, in the end it still closed, because after these recommendations nothing more was done, and they understandably eventually exhausted their capabilities.

The forecast of business development is of different types

The forecast of business development can be of different types. You can predict whether the business will go at all. You can predict how long the business will remain relevant and generate revenue. You can predict the scale of business development. Why is this all possible? This is because business is basically an idea. If the business is built correctly, if it corresponds to the idea that underlies it, then it will 100% go.

As long as the idea that underlies the business is relevant, it is going up the hill. But over time, any idea loses relevance, respectively, and ends the business that is built on its basis. The relevance of the idea is gradually reduced, which allows you to predict the life of the business. So if you build a forecast of business development, with a high probability you can find out whether it will go, how long it will last and to what level it will grow.

Author of the consultation: Pavel Bernovich

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