Estimating Net sales

Four levels of Net sales

In Valuatum Company Model you have four different levels to estimate Net sales:

1.    Total
2.    Quarter (two first years)
3.    Division
4.    Quarter and division (two first years).

Besides different levels, you can estimate Net sales growth % or just absolute Net sales. Whichever way and whatever level you use, the other figures react to your changes.

What happens when I change total Net sales?

Since there is a possibility to estimate Net sales for so many ways, there must be rules how to keep the other levels in balance. In the company model there are two basic rules for the changes:

1.    Allocating on the basis of the old proportions.
2.    Calculating a sum.

The first rule is used when you enter e.g. total Net sales and the model has to decide how the lower levels are calculated.
The second rule is used in the opposite cases. If you estimate e.g. second division's Q3's Net sales, new second division's Net sales is a sum of all quarters and new Q3's Net sales is a sum of all Q3-figures.

Net sales growth % as a dominating variable

When you estimate current year's Net sales, there are two possibilities for the following years: either growth % or absolute figure to change. In the company model Net sales growth % is the dominating parameter (and absolute Net sales the one that changes).