Once you have formulated a basic or new strategy for your business, you will have to make some forecast of the likely results of your endeavours. These projections are essential to show how much cash you will need and how much profit you could make, and to chart a safe financial strategy. This is the part of your business plan of greatest interest to potential backers and anyone else whose support is essential to your venture.
Your forecasts may well prove wrong, and initially at least, you may have little confidence in them being achieved. But the learning that comes from carrying out these projections will serve to increase the chances of ending up with a plan that you do believe in, and that has a good chance of achieving results that will ensure your venture survives.
The task in forecasting is to get your dart on the board, rather than to hit the bullseye first time. Once on the board you can correct your aim with subsequent throws. Remember these forecasts are being made before you commit resources, so in effect, you can have as many throws as you like at this stage, without the pain of the resultant consequences.