Making a Plan: How to Develop Three-year Projections
It’s only a matter of time before your CFO figures out that you have more influence over his financial plan than he does. But when that moment arrives, your CFO will ask you for a plan that projects sales for the next three years or so.
Smart catalog companies handle financial planning as a partnership between the marketing and financial staffs. Mailing is your key revenue-generating activity. Mail quantity, frequency, response rate and average order value (AOV) are the essential numbers for projecting sales. Consider each factor:
◆ Your mail quantity determines marketing expense;
◆ Your sales level helps project the company’s cost of goods; and
◆ Your number of orders helps project your variable fulfillment costs.
- Companies:
- J. Schmid & Assoc.
A columnist for Retail Online Integration, George founded HAGUEdirect, a marketing agency. Previously he was a member of the Shawnee Mission, Kan.-based consulting and creative agency J. Schmid & Assoc. He has more than 10 years of experience in circulation, advertising, consulting and financial strategy in the catalog/retail industry. George's expertise includes circulation strategy, mailing execution, response analysis and financial planning. Before joining J. Schmid, George worked as catalog marketing director at Dynamic Resource Group, where he was responsible for marketing and merchandising for the Annie's Attic Needlecraft catalog, the Clotilde Sewing Notions catalog, the House of White Birches Quilter's catalog and three book clubs. George also worked on corporate acquisitions.
