Setting Revenue Forecasts for Roster Budgets

TIP: This article assumes you have already set up your pay templates and assigned them to your staff.

If your business requires a flexible workforce and a roster that changes based on revenue, then budgeting on revenue forecasts may be the most effective method. This style of roster budgeting is common practice for businesses in industries such as hospitality and retail, where seasonal and daily revenue can fluctuate significantly, and business owners need to adjust rosters and labour costs regularly to remain profitable.

So, how exactly does using revenue forecasts to budget work? The process involves you predicting the revenue for the period before you publish a roster and then letting ClubsHR calculate the labour cost as a percentage of revenue.

Example: If you forecast revenue on Monday of $3,800 and have a total estimated cost on the roster for that day of $1,300, your labour percentage would be 34.2% ($1300 / $3800).

Setting a Revenue Forecast

First, you need to decide whether you want to forecast your revenue daily, weekly or monthly. For ideas on what may work best for you, head to the Choosing a Revenue Forecast Period section below.

Once you've decided on the period, unhide the financial summary if you have hidden it.

Ensure the roster period matches your revenue forecast period. Then type your forecast into the Revenue Forecast field and click Update.

A new panel in the Financial Summary is displayed, giving you your labour percentage.

Choosing a Revenue Forecast Period

First, you need to decide how granular you want your revenue forecast. Do you need a different revenue forecast for each day of the week, or can you get away with a weekly or monthly revenue forecast?

A weekly or monthly forecast still allows you to look at your labour costs granularly, as the revenue forecast will be averaged out by the number of days through the period instead of specific to the day. For instance, if you set a monthly forecast but switch between a weekly and daily view of the roster when you roster on staff, the revenue forecast will be proportionate to the period you are currently in.

For example, if you set your forecast monthly and it was a 30-day month. Working in the daily view would divide the monthly forecast by 30. Switching to a weekly view would divide the budget by the number of weeks, which would be 4.28571429 weeks in a 30-day month.

Daily Forecasting

Set your revenue forecast daily for a fluctuating revenue forecast, which is best suited for businesses that often find their revenue follows a fluctuating daily trend and generally receive payment immediately for their goods or services. For instance, hospitality typically sees an increase in business on weekends and slower Mondays or Tuesdays. They also receive payment on the day.

Weekly and Monthly Forecasting

Setting your revenue forecast weekly or monthly is best if your business revenue and staffing needs are more consistent throughout the period. Choosing between the two forecast periods may vary based on the frequency with which your business brings in or reports the revenue. It may also be influenced by your rostering cycle, but it doesn't always need to follow the roster.

Monthly - If your business invoices, all work once a month, even if you roster weekly. It is easy enough to set the forecast for the month, switch to the weekly view and roster your staff from there.

Weekly - If you know your numbers weekly or need to keep a closer eye on things to remain profitable, setting a weekly forecast is still easy to work with but allows you to set forecasts that may need some variance for busier and quieter weeks.