The next major factors that will help you forecast your cash flow are your strategy and plans for growth in the coming year. This might include increasing sales through:
- New marketing and promotional activity
- Product and service development and launch
- Expanding into new markets
- Reaching consumers in new ways
On the other side of things, you will need to take into account increased costs, such as:
- Hiring more employees to deal with demand
- Buying more inventory to meet customer needs
- Higher operational costs for distribution, utilities and miscellaneous expenses
Your marketing efforts and new product development are likely to increase sales by around 40 percent next year. As a result, you will need to hire a couple more sales and customer service staff, which is going to increase your staff costs by 25 percent. You believe you’ll see increased expenses of roughly another 5 percent elsewhere in the business.