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In the book Side Hustle, I shared a back-of-the-napkin spreadsheet template for forecasting income in a new business. Today's listener came across it and asked a fair question.
I read about the back-of-the-napkin forecasting in the Side Hustle book, but I'm still a little uncertain of how you can predict income with a new business. You don't know how many sales or customers you'll get, so how can you even estimate? I'm trying to decide between a few different ideas, and if I had a better idea of their income potential it would help a lot.
The key: the template is meant to show potential. Yes, there's a lot you don't know before launch — but you can still make estimates. What you're really determining is what it would take for the idea to be profitable and sustainable: How many customers? How many sales? At what price point? You plug in your best guesses.
One tip: make three versions — your best guess, a conservative minimum, and one where the idea really takes off. A spreadsheet makes this easy.
Here's why it matters: in my early twenties I tried to start a golf membership program for $1 per person. If I'd bothered to map it out, I'd have seen it needed hundreds of customers a day just to be sustainable. It didn't work out — and now I do this basic forecasting ahead of time (and charge more than $1).
Have a question? Visit SideHustleSchool.com/questions.
