3-Year Financial Projection Help Guide

Use your Start-up and Operating Costs Worksheet information to help you make your 3-year financial projections calculations.

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Cost of Sales calculation includes:

2. Materials, Labor, and Overhead costs. 
3. Overhead costs include rent, utilities, manufacturing equipment, and shipping.

Cost of Sales calculator:  https://calculator.academy/unit-product-cost-calculator/

1. Input the values of the materials, labor, and overhead costs from the per month column from your Start-up and Operating Costs Worksheet into the calculator. 

***Cost of sales calculation is used to find the total cost of producing 1 product***

2. How many products did you intend to produce per day? _________ 

3. Multiply the cost of producing one product by the number of products you intend to produce per day to get the total daily production cost. ______________

4. Multiply the cost of products produced per (from step 3) day by 30 to get the total monthly production cost. ________________

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Price Point calculation:

Use the cost of producing 1 product and multiply your percentage markup and add this value back to your cost of sales to achieve your price point. 

Example:  Cost to make 1 product is $10 x 20% markup = $2.00 

$10.00 + $2.00 = $12.00                  You will charge $12.00 for each product sold.

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Sales and Revenues Calculation: --needed for your 3-year financial projection

Multiply the number of sales you will make per month x your price point to determine your Sales and Revenue.

Sales and Revenue = Sales per month x price point

Example:  300 x $12.00 = $3,600

Enter this value into the Sales and Revenue column for “month” on your 3-year financial projection.

On your 3-year financial projection, the pre-tax loss will show up as a number in parenthesis indicating you showed a loss.  The pre-tax profit will not have a parenthesis indicating you showed a profit.

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Quarters 1, 2, 3, and 4 Calculations:

1. Take the “month” calculation and multiply by 3 to get Quarter 1 calculations for each line item.

For Quarters 2, 3, and 4: Sales and Revenues, Materials, Shipping and Outsourced costs

3. A growth calculation of 2.5% was used for each quarter.  
4. The calculation includes:  Quarter 1 x 2.5% + Quarter 1
5. The following formula is within the document. E4*0.025+E4

**Keep advertising, facility rent, management and administration, labor, and utilities costs the same for the first year.**

Year 1, 2, and 3 Calculations:

For Year 1:  All line items

2. The sum of each quarter was used.
3. The following formula is within the document:  SUM(E4:H4)

For Year 2:  Sales and Revenues, Materials, Shipping and Outsourced costs

3. A growth calculation of 15% was used.
4. The calculation includes: Year 1 x 15% + Year 1
5. The following formula is within the document:  I4*0.15+I4

For Year 3:  Sales and Revenues, Materials, Shipping and Outsourced costs

6. A growth calculation of 20% was used.
7. The calculation includes:  Year 2 x 20% +Year 2
8. The following formula is within the document:  K4*0.20+K4

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For Start-Up Costs and Investments:

For Year 1, 2, and 3

2. The sum of the start-up costs was used.
3. The following formula is within the document:  SUM(I18:I24)

****All formulas can be edited or deleted****