2 Excel Templates
1) Revenue Forecast with Account Management Inputs
This topic is also addressed narratively in the last section of my newsletter: How to use account management to forecast your revenue for SMEs.
Key inputs:
Reliable [predictable] revenues [based on contracts]
Expected from current clients [weighted by appropriate probability]
New client’s revenue [weighted by appropriate probability]
Click here to get your Excel template
The model can be adjusted very easily to any company. Keep you posted for the rest of the templates.
2) M&A Process and Model
Click here to get your Excel template
Here are 2 Infographics for Today:
1) M&A Buy Side Process Simplified
Someone once said: a deal dies 20 times. Here’s what could happen:
❌ The first time, when the seller is unhappy with the non-binding offer and sees no room for improvement.
❌ The second time, when the seller realizes how much they still need to remain involved in the company they are selling.
❌ The third time, when the seller receives an unfavorable non-competition clause.
❌ The fourth time, when the seller is dissatisfied with the proposed deal structure, the initial payment, or the earnout.
❌ The fifth time, when the seller changes their mind due to emotional reasons.
𝗔𝗻𝗱 𝘄𝗵𝗮𝘁 𝗮𝗯𝗼𝘂𝘁 𝘁𝗵𝗲 𝗯𝘂𝘆𝗲𝗿? 𝗢𝗵, 𝘁𝗵𝗲𝗿𝗲 𝗰𝗼𝘂𝗹𝗱 𝗯𝗲 𝗮 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗿𝗲𝗮𝘀𝗼𝗻𝘀 𝘁𝗼 𝘄𝗮𝗹𝗸 𝗮𝘄𝗮𝘆:
👉 findings from due diligence,
👉 quality of earnings issues,
👉 financing challenges,
👉 cultural differences,
👉 integration risks,
👉 people and management at the target company,
👉 and more.
Anyway, this is a process [see below] you have to go through to get a deal done. At each step, there are numerous deal breakers.
Get this infographic on a high-resolution PDF
2) The Cash Flow Process Simplified
I received the business results of my company in the form of an annual P&L for this year. It’s quite reliable; we have a solid live forecast system. 😀
We know what we will invoice, and we know our expenses.
However, when I look at the profit and compare it with the bank account balance, my question is:
Where is the money?
A very small amount of money appears on the cash balance compared to the stated profit??
Profit seems to serve as a taxable base for paying taxes 😡, while cash is what I take home.
Therefore, next year, I am entering with new superpowers, and that is to build a powerful model for easily tracking future cash flows.
Here are some examples that impact on lower CF vs Profit:
👉 Sales are recognized in profit, but cash is not yet received.
👉 Cash is spent on inventory, while the cost is not yet expensed.
👉 Cash is used to pay suppliers but the expense was already recorded in a prior period.
👉 High non-cash expenses
👉 Prepaid expenses
👉 Too much Capex
👉 Dividend distribution
Here’s where I’m starting from.
Get this infographic on a high-resolution PDF
Here’s today’s “How to” guide:
How to build reliable revenue forecasts based on account managers’ inputs.
I always shift the focus to people because only persona can impact a business.
Therefore, it’s important to understand what drives that impact
For sure that is someone’s behavior, someone’s action.
Behind behavior lie emotions, and behind emotions are beliefs.
To make an accurate outcome assessment (not just Revenue, which is the topic here), it’s essential to understand this structure. Forecasts aren’t just about customers, prices, suppliers, or quantities—forecasts are shaped by people.
A person is the one who must consider all factors and provide a final judgment on the outcome assessment.
The probability of success increases when things are viewed from multiple perspectives and positions, considering the motivations behind the estimates.
For example, someone responsible for acquiring new clients might have a motive to keep forecasts low to ensure they can easily achieve them and secure a bonus based on that.
Meanwhile, someone in top management or a partner might be motivated by higher forecasts. The owner typically has a motive for the highest forecasts.
I like to give the greatest weight to those closest to the clients or customers, while paying due attention to their motives and personalities.
Each account manager provides their view of the forecast (in this example, a full financial year forecast), which they regularly update and discuss with managers.
Each manager (client lead) oversees their own clients.
Dividing responsibilities among as many account managers as possible allows for greater focus and dedication. It’s not necessary for someone to hold a high position to manage a client.
If there are clients with lower importance, smaller fees, or less frequent contact requirements, someone at a lower position can handle that job.
[download the template given in the first part of this Newsletter]
When each forecast from all client leads is consolidated, we get an aggregate forecast at the company level, which we can compare to historical periods or budgets.
Here’s my proposed structure for how this should look at the client manager level:
In the first block, we have reliable revenue by service line for each client. These are revenues already contracted or with a likelihood of over 95%, meaning they are almost certain or entirely certain.
In the second block, we have some expected revenues—not highly certain, but there’s a solid chance of realization (e.g., a likelihood of 60–90%). Due to lower certainty, these revenues are weighted by the probability of occurrence.
Looking horizontally, we see new clients—clients who are not yet known but are expected based on historical data on client generation. The probability here is the lowest.
Finally, we have the total forecast.
We also have a separate sheet comparing this forecast to the previous year and the budget across all service lines.
Don’t forget that we need to talk with client leads, follow progres per clients, cross selling opportunities. Knowing their expectations, feelings, motives is a must. Only this way we can impact them to deliver a perfect forecast.
