Analysis of actual and forecast profits

1. Analysis background introduction

This case comes from a fast-moving consumer goods enterprise. The actual and forecast analysis of its sales profits is mainly to ensure that the enterprise can continue to make profits in the fiercely competitive market and adjust the strategy in time according to the data. The fast-moving consumer goods industry usually faces rapid market changes and fierce price competition, so accurate profit forecasting and management are crucial.

In addition, due to the short sales cycle and short product life cycle of fast-moving consumer goods, the company must maintain a high degree of flexibility in production, inventory, marketing, etc., and respond to market demand in a timely manner. In order to achieve this goal, accurate profit forecasting and flexible cost control are one of the core competencies of enterprises.

2. Statement of key issues

Prediction and actual difference analysis:Analyze the difference between predicted profit and actual profit, and identify the main reason for the difference is insufficient market demand, poor cost control, or the impact of external factors (such as supply chain interruption).

Completion of the annual profit target:According to YTD and YTG'sProfit analysis, check whether the expected profit can be achieved according to the annual target, and if there is any deviation, make strategic adjustments in time.

3. Analyze the plan

3.1 Select key data indicators.

Explanation: The indicators selected in this case are common indicators in the analysis. In the analysis work, priority should be given to the indicators that have the greatest impact on the business to ensure that the purpose of the analysis is consistent with the business objectives and key performance.

3.2 Power BI Visualization Scheme

Note: The DEMO page data is simulated data, which is for reference only to the analysis angle and Power BI function display, and does not involve any actual business data.

4. Analysis and interpretation

YTD actual profit:That is, the actual profit of "Year-to-Date" represents the actual profit from the beginning of the year to the current date. It reflects the overall situation of the company's current profitability.

YTG's actual profit:That is, the actual profit of "Year-to-Go" represents the actual profit expected from the current date to the end of the year. Generally speaking, this is the expected future profit based on the current performance.

Actual profit of H1 and H2:H1 refers to the actual profit in the first half of the year, and H2 refers to the actual profit in the second half of the year. The two added together are the overall real profit of the current year. The comparison of H1 and H2 helps to analyze the impact of seasonal fluctuations in the company's profits or the adjustment of business strategy.

This month's actual value: Represents the profits realized in each region this month.Value of the same period last year:It refers to the profit situation in each region in the same month last year, which is helpful for a comparative analysis of time to assess the reasons for growth or decline.Year-on-year growth value and year-on-year growth percentage: Year-on-year growth refers to the profit difference between this year and the same period last year, and the percentage of increase is the ratio of growth/decrease. These two indicators help to understand the growth of the company in different regions, especially in which areas perform well and which need to be improved.

The proportion of this month's region: It reflects the proportion of regional profits in the overall profit, which helps to judge which region contributes the most or the least, which is very important for optimizing resource allocation and regional strategic decision-making.

Monthly profit: It refers to the actual profit of the month.YTD actual profit: Reflect the actual cumulative profit from the beginning of the year to the present.YTD's profit last year: Represents the cumulative profit at the same time last year.YTD year-on-year:It is used to compare the profit differences between this year and the same period last year, and can analyze the reason for the growth or whether there is a risk of business decline.YTD pre-real ratio:It refers to the ratio of current actual profit and expected profit, reflecting whether the company has achieved the expected profit target as planned. The higher the forecast-to-actual ratio, the more the company's performance is in line with expectations.

Profit achievement rate:It refers to the ratio of the company's actual profit to the predetermined target profit, which is used to measure whether the company has achieved the predetermined profit target. If the achievement rate is high, it means that the company's profitability is good, and on the contrary, the business strategy may need to be adjusted.

5. Application effect

Optimize pricing and promotion strategies:If the analysis shows that there is a difference between the predicted profit and the actual profit, especially the actual profit is lower than the predicted profit, the enterprise can analyze the effect of promotional activities and assess whether the pricing strategy is too radical or the market response is not as expected. For example, if the profit does not meet expectations after the promotion of some products, it may be that the price is too low or the promotion is too great, resulting in a decrease in gross profit.Based on this analysis, enterprises can adjust the promotion plan and adjust the product pricing strategy to avoid profit loss.

Refine the market segmentation:The analysis of sales forecast bias helps to identify the profit contribution of different markets, customer groups and sales channels. If the actual profit of some sub-markets is significantly lower than expected, it may mean that the market has not been fully developed or the product does not meet market demand. At this time, enterprises can focus on the deep cultivation of high-profit markets, optimize resource investment, and setThe advantage of the middle force to attack.

Accurate goal setting:Through in-depth analysis of the differences, enterprises can re-evaluate the sales and profit targets of the next stage, make the targets more in line with the actual market situation, and improve the feasibility of achieving.For example, if profits fall short of expectations in a quarter due to external factors (such as fluctuations in raw material prices and price reductions from competitors), the target setting for the next quarter can take these external variables into account and make more conservative or adaptive adjustments.

Performance appraisal and goal orientation:Profit difference analysis helps to optimize the company's performance appraisal system. When there is a large difference between the forecast and the actual profit, the company can analyze the reasons and take measures to improve the execution of employees. For example, whether there is a deviation in the employee's understanding of the goal, whether the goal is unrealistic due to changes in the external environment, or whether the employee fails to give full play to the potential. Enterprises can adjust the assessment targets and incentives according to the analysis results, stimulate the enthusiasm of employees, and improve the overall performance.

Transparent management and communication: Through regular profit difference analysis, enterprises can better communicate with employees about the current business situation of the company and improve employees' sense of identification with the company's goals and direction. When employees understand the difficulties and challenges of the company in achieving profit goals, they can often better understand the company's decision-making and changes and enhance team cohesion.