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Copyright 2009-
I am starting a tax preparation service. What is a realistic goal for me to shoot
for on the number of clients I can expect to prepare tax returns for in my first
year? My market that I am shooting for is low to middle income individuals and families.
- M.U.
When you are planning a sales forecast, you should always consider three types of sales forecasts:
- Your maximum sales
- Your break-
even sales - Market based forecast
Maximum Sales
Consider how many returns you can possibly do in the time you can commit to working directly on returns, that is, excluding marketing, sales, preparation time. If you will have employees, add their productivity as well. Based on your target market, the tax season may be very short (February through April), so be sure to base your numbers on the realistic timeframe. Use this as an upper limit on your forecast.
Break-Even Sales
This is the number of sales that you will need to make to just cover your time and expenses, without the business turning a profit, but also without incurring any additional debt. Use this number as the lower limit on your forecast. If this number is higher than your maximum sales, stop now and rethink your plans.
Market Based Forecast
This is the “fuzziest” of the three types of sales forecasts. It is based on how
many potential customers are in your target market, how many of them use any service
like yours, and how many of those you think you can capture for your business. The
big red flags are if there are fewer potential customers than you need for your break-
The full details of each of these sales forecasts are covered in the Entrepreneur CEO course.