First, the bottom line: Financial forecasting is a matter of making educated guesses as to how much money you’ll take in and how much you’ll need to spend — and then using these estimates to calculate whether your business will be profitable.
Financial projections simply predict the amount of sales revenue you can expect from your eBay business; the expenses you will incur, including the cost of the products you are selling; and the profit you can anticipate. If your eBay business is not already off the ground, your projections will help determine how much you’ll need to invest or borrow to get it started. Forecasting is always easier if you’ve been in business for a little while, because you have months (or years) of actual revenue and expenses upon which to base your forecasts. If you do not have any operating history, financial software such QuickBooks or Microsoft Office Accounting can help you get started.
Business people use different types of financial projection analysis and tools, all meant to give them information and help in making decisions about the future. Below are common examples.