June 4, 2024
|Revenue forecasting is the practice of predicting how much money your organization will make from future sales. It involves comparing those estimates to the actual sales numbers to see just how accurate that prediction was. Why is revenue forecasting important for your organization? It helps your team make smart decisions based on concrete data over time.
And these days, you don’t even need to do it all manually. Accounting software such as Sage Intacct for senior living can help facilitate the revenue forecasting process with automated reporting models.
In the senior living sector, revenue forecasting can help accurately predict financial challenges and opportunities to improve your community.
The revenue forecasting process is multifaceted and can help you understand key needs for your community, including:
Forecasts can also guide investment in new locations or services, help in the calculation of resource requirements, and assist in aligning maintenance and care team recruitment efforts with anticipated revenue growth.
Are you wondering how to get started, or how your current revenue forecasting model stacks
up to best practices? Any effective revenue forecasting methodology involves four critical steps:
A few common obstacles often come up in the revenue forecasting process. By addressing these
challenges head-on, senior living leaders can refine their forecasting practices to be more
robust and responsive.
Market Volatility: The aging population, combined with fluctuations in the healthcare landscape, can result in difficult-to-predict revenue. Overcome this by:
Data Quality and Availability: Reliable data from surveys, healthcare statistics, and internal reporting is often not readily available, making accurate forecasting more difficult. Overcome this by:
Complex Cost Structures: Senior living organizations’ cost structures are complex, affected by healthcare regulations, the nature of services provided, and the needs of residents. Overcome this by:
Forecasting is not a one-time event. Regular reviews, ideally quarterly, will ensure you can adapt to changing market conditions and new data. Technology can also make a difference. Forecasting software that comes with built-in analytics and reporting capabilities can streamline the process and decrease the margin of error.
Utilize cross-functional collaboration. Each part of your organization has a piece of the revenue puzzle. Establish a process that includes input from various departments and locations to ensure you’re seeing the whole picture. Once you’ve heard from everyone, equip your team with the skills and knowledge they need to both understand and contribute to the forecasting process.
Lastly, incorporate risk assessment into your forecasting model. What are the potential risks to your revenue plan, and how can you mitigate them?
By recognizing the strategic importance of revenue forecasting and investing in a robust process, senior living leaders can not only help secure the financial future of their organizations but also ensure that teams can adapt and lead in the marketplace.
Reach out to our team to learn more about how Sage Intacct can help your senior living organization improve revenue forecasting and help care teams and residents thrive.
Chadd Arthur is a seasoned professional with over 25 years of experience in the non-profit sector, specializing in process improvement and the strategic alignment of organizational goals with technology solutions. Leveraging his extensive expertise, Chadd conducts regular strategic assessments for organizations, guiding them towards enhanced efficiency and effectiveness. With a profound passion for aiding clients in recognizing the value of process improvement, Chadd leads our team in secure technology solutions that directly contribute to their mission success. His commitment to excellence is evident in his contributions to the industry, including participating in panels and serving as a thought leader to a network of non-profit professionals. Chadd earned his MBA from Indiana University Bloomington and resides outside the greater Chicago area. Chadd not only brings a wealth of knowledge and experience but also a dedication to making a meaningful impact in the non-profit space.
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