VFD Technical Academy
From Forecast to Funding: Using Scenario Planning to Support Growth Decisions
Growing a business often means making decisions before you have perfect information. Whether it’s expanding into new locations, acquiring complementary operations, or investing ahead of demand, business owners and advisers need a clear way to understand what growth really looks like financially – and how it can be funded safely.
In this practical webinar, we explored how scenario planning and funding forecasts can be used to test growth decisions, assess funding requirements, and present a credible case to lenders. The session focused on real-world application rather than theory, using a franchise expansion example to demonstrate how assumptions flow through profit, cash, and balance sheet outcomes.
Starting with a solid baseline
The session began with a reminder that any growth conversation must start with a clear “as-is” baseline. This is not about optimism or ambition – it’s about understanding how the business performs today.
Key principles covered included:
Forecasting material income and cost lines individually
Grouping smaller, less predictable items without losing accuracy
Preserving total values while simplifying forecast inputs
Ensuring the baseline reflects reality, not aspiration
This baseline becomes the reference point against which all future scenarios are tested.
Modelling growth scenarios without over-engineering
Using the example of an existing franchise operator planning to acquire three additional franchises, the session showed how to layer growth assumptions onto the baseline without building three separate, fully detailed models.
The approach demonstrated how to:
Introduce new revenue streams with realistic ramp-up periods
Apply conservative margin assumptions to manage downside risk
Phase overheads ahead of revenue to reflect real trading conditions
Assess the cumulative impact of multiple growth initiatives over time
The result was a clear picture of how the business could grow from a solid, profitable operation into a significantly larger group – while still remaining understandable at a board or lender level.
Understanding the cash reality behind growth
A recurring theme throughout the session was that profit does not equal cash. Even profitable growth can create pressure if working capital and timing are not understood.
The model walkthrough highlighted:
When cash shortfalls actually occur during expansion
How funding timing matters just as much as funding amount
Why some growth plans fail simply because cash requirements are underestimated
The importance of stress-testing assumptions rather than relying on EBITDA alone
This is where scenario planning becomes a risk-management tool, not just a planning exercise.
Building funding scenarios that lenders understand
Once the growth case was clear, the session moved into funding. Rather than treating funding as a separate exercise, the model showed how borrowing assumptions could be integrated directly into the forecast.
Key areas covered included:
Phasing loan drawdowns in line with expansion milestones
Modelling interest and repayment terms
Understanding the impact of debt on cash flow and net worth
Comparing baseline vs “with funding” outcomes over five years
This made it possible to answer the lender’s core question: can the business comfortably service the debt while growing?
Turning forecasts into a funding proposal
A standout part of the session was the demonstration of how forecasts can be translated into a structured funding proposal.
Rather than starting from a blank document, the model generates a lender-ready narrative covering:
The purpose of the funding
Business background and recent performance
Financial trends and seasonality
Forecast assumptions and sensitivity analysis
The projected impact on profit, cash, and balance sheet strength
This helps advisers and finance leaders move from numbers to narrative – a critical step in successful funding applications.
Performance vs forecast: keeping plans alive
The final section of the webinar addressed what happens after the forecast is built. Plans only remain useful if they are actively reviewed.
The session demonstrated how to:
Pull actual results into the forecast model
Compare performance against plan at both monthly and cumulative levels
Identify where variances matter – and where they don’t
Adjust expectations without constantly rebuilding full forecasts
This approach supports better conversations with business owners and leadership teams, focusing on implications and decisions rather than historic explanations.
A practical framework for better decisions
This webinar reinforced that forecasting is not about predicting the future perfectly. It’s about creating a structured way to test decisions, understand risk, and communicate clearly with stakeholders – whether that’s business owners, boards, or lenders.
For anyone supporting growth-focused businesses, the session offers a practical framework for linking strategy, funding, and performance into one coherent financial story.