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    Entrepq2 2 1

    Uploaded by

    Juvy Fernandez Abong Dejesa

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    © All Rights Reserved
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    Entrepq2 2 1

    Uploaded by

    Juvy Fernandez Abong Dejesa
    5 views25 pages

    Original Title

    ENTREPQ2.2.1

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    © © All Rights Reserved

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    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    5 views25 pages

    Entrepq2 2 1

    Uploaded by

    Juvy Fernandez Abong Dejesa

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    You are on page 1of 25

    FORECASTING THE

    REVENUES OF THE
    BUSINESS
    •Revenue is a result when sales exceed the
    cost to produce goods or render the
    services.
    •Revenue is recognized when earned,
    whether paid in cash or charged to the
    account of the customer. Other terms
    related to revenue includes Sales and
    Service Income.
    •Sales is used especially when
    the nature of business is
    merchandising or retail, while
    Service Income is used to
    record revenues earned by
    rendering services
    FACTORS TO CONSIDER
    IN FORECASTING
    REVENUES.
    1. The economic condition of the country. When
    the economy grows, its growth is experienced by
    the consumers. Consumers are more likely to
    buy products and services.
    •The entrepreneur must be able to identify the
    overall health of the economy in order to make
    informed estimates. A healthy economy makes
    good business.
    •2. The competing businesses or
    competitors. Observe how your competitors
    are doing business. Since you share the
    same market with them, information about
    the number of products sold daily or the
    number of items they are carrying will give
    you idea as to how much your competitors
    are selling.
    3. Changes happening in the community. Changes’
    happening in the environment such as customer
    demographic, lifestyle and buying behavior gives the
    entrepreneur a better perspective about the market.
    • The entrepreneur should always be keen in adapting
    to these changes in order to sustain the business.
    • For example, teens usually follow popular celebrities
    especially in their fashion trend. Being able to
    anticipate these changes allows the entrepreneur to
    maximize sales potential.
    • 4. The internal aspect of the business. Another factor that
    affects forecasting revenues in the business itself. Plant
    capacity often plays a very important role in forecasting.
    • For example, a “Puto” maker can only make 250 pieces of puto
    every day; therefore he/she can only sell as much as 250
    pieces of puto every day. The number of products
    manufactured and made depends on the capacity of the plant,
    availability of raw materials and labour and also the number of
    salespersons determines the amount of revenues earned by
    an entrepreneur.
    Table 1 shows the projected daily revenue of Ms. Nista’s online selling
    business. Computations regarding the projected revenue is presented
    in letters in upper case A, B, C, D, and E.
    • The numbers in the last table are very attractive,
    having revenues that are increasing in numbers is a
    good sign that a business is growing. However, an
    entrepreneur should not be overwhelmed on these
    revenues as these are just gross revenue, this is not
    the final amount of profit or income an entrepreneur
    will get at the end of every period. Take note that the
    amount of net revenue is still subjected to the
    expenses incurred in the operation of business.

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