In addition to illuminating the best business model and opportunity, Forecasts can also assess risk. The Forecast is a risk assessment tool as well as an opportunity discovery tool.  Many times, in my businesses the forecast would tell me how much of a cash drain would a new acquisition or purchase or new business model be. 

One time I was looking to acquire a competitor that would increase the size of my business 3 times. The forecast told me that it was a worthy pursuit and that it would likely not impact my cash reserves and not force me to increase lines of credit risking more personal liability exposure. That one assessment alone made the forecast a valuable tool.  In this instance, the forecast allowed me to assess the risk of the potential acquisition and to act accordingly.  It gave me the clarity and peace of mind to know that it would not negatively impact cash or risk personal liability exposure. 

This is yet another reason why a business and cash flow forecast is a must for business owners who want to take control of their business!