Which forecast should you actually quote?
Sixteen quarters of billed fees, smoothed twice. At a damping of 0.3 next quarter comes back at 1,053.27; at 0.8 it comes back at 1,028.97. Nothing changed but the setting, so the sheet also shows which one fits.
Finance Starter Forecasting free
After you install, this is the model to open.
What Will Next Quarter's Fees Be?
- In your spreadsheet, click the Sortia icon in the strip of icons down the right-hand edge. No strip? Click the arrow at the bottom-right to open it. You can also use Extensions, then Sortia, then Open Sortia.
- Click Start from a template and put that name in the search box.
- Pick the card with that name and click Load this template. It arrives on a new tab with real numbers already in it.
The answer
The two runs, and the referee between them:
- Forecast at 0.3
- 1,053.27 standard error 94.07
- Forecast at 0.8
- 1,028.97 standard error 113.20
- Difference
- $24,300 from one setting
- Which to quote
- the responsive one it fits this history better
Damping is the share of the old forecast carried forward, so a heavily damped forecast on a growing series is always behind, which is why the smoother version is also the lower one. The bigger limitation is one no setting can fix, and the data makes it obvious: the third quarter is soft in every one of the four years and the fourth is strong in every one. Exponential smoothing carries no seasonal term, so it will under-forecast every fourth quarter whatever you set. If your fee history repeats on a quarterly rhythm, and most practices do, run Holt-Winters on the same column with a season length of four.
The model
One column of quarterly fee totals in time order, oldest first, with a forecast block beside it and the cost of a partner underneath for scale.
| Quarters of history | 16 |
| Damping factor | 0.3, then 0.8 |
| Fees range | 862 to 1,102 per quarter |
| Forecast | the last smoothed value |
| Standard error | calculated per run |
Once it is in your sheet
- The model arrives with real numbers in it and runs as it stands, so you can press the button first and understand it second.
- Change the numbers to yours. The sheet marks which cells are inputs and which hold formulas, and most labels carry a note explaining the row.
- Press the run button at the bottom of the panel. It is labeled for the tool you are in, and the result lands on its own tab, with a written reading of it beside the figures.
Never used Google Sheets? Start here goes the whole way, in seven steps, and assumes nothing.
Next question
- Is that client really slower or just one late invoice?Do These Two Clients Pay at the Same Speed?
- Is the plan limited by money or by people?Split a Fixed Budget Across Three Things
- How often does an ordinary year lose money?What If the Biggest Client Leaves?
- Did that payment land on the right client?Match the Invoices to the Client List
- What are the odds the carry is zero?What Does Carry Actually Look Like?
- Do overruns or write-offs cost you more?Will the Fee Book Cover the Practice?
Every model like this one, and the method behind them: Forecasting in Google Sheets.