1Checking the data
Whether the records can be trusted and whether the economics of a single customer have been calculated.
Financial Model
Numbers you can make decisions on. The model shows what the business is sensitive to and what each decision will cost.
Sound familiar?The financial forecast doesn't explain where the result comes from, It's unclear what happens if the price or volume changes, Cash flow is controlled after the fact
Finance and Economics
How we work
1
2Drivers
What determines revenue and costs.
3Scenarios
Base, cautious and target, with cash flow and financing needs.
4Review points
Which events trigger a recalculation of the model.
Sound familiar?
- The financial forecast doesn't explain where the result comes from.
- It's unclear what happens if the price or volume changes.
- Cash flow is controlled after the fact.
What usually lies behind it
A model's value lies not in its precision but in showing sensitivity: which assumption changes the result the most. A model built on unreliable numbers is more dangerous than no model, so we start by checking the inputs.
What you get
A model with transparent assumptions that your team can update.
Three scenarios and a sensitivity analysis.
A 13-week payment calendar as part of the model.
The cost of waiting
If nothing changes
- 01
The company will confuse revenue with resilience.
- 02
Decisions on hiring and investment will become expensive guesses.
- 03
Cash gaps will be discovered late.
When you don't need this service
- You need a one-off calculation for one decision. Then a break-even or profitability analysis is faster.
- The numbers can't be trusted. Records come first.
How to tell it worked
Transparent assumptions
whether you can find in a minute what the result depends on.
Forecast accuracy
how closely the quarter's actuals matched a scenario.
Use
whether the model is updated and decisions are made with it.
Questions
What software is the model built in?
Whatever your team can update it in. Usually a spreadsheet.
Do we need a model for an investor?
An investor needs a model they can trust: with clear assumptions and honest scenarios.
How often should it be updated?
Actuals monthly; assumptions quarterly or when something significant happens.
Related
Services: Break-even Analysis · Profitability Analysis · Management Accounting Materials: Unit economics for owners: seven numbers · The cost of doing nothing
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