Questions to ask forecasting software vendors

author Nicola van Rijn

Forecasting your income, expenditure, and cash flow is essential for managing your business finances and planning for the future. In simple terms, informed decision-making results in better outcomes. Traditionally, business planning and forecasting hinges heavily on expertise, experience, and intuition. However, these methods are prone to error, as is manually calculating financial forecasts. Not to mention how time-consuming it is.

Financial forecasting software will eliminate a lot of manual work and substantiate business decisions (even if they are intuitive) with data-driven logic.

xlreporting team

Does the solution support your process?

There are many different financial forecasting methods that companies can use. The four main methods are straight-line forecasting, moving average forecasting, simple linear regression forecasting, and multiple linear regression forecasting.The best financial forecasting software includes all these methods, so you can compare them and choose the best one for each specific scenario.

When considering forecasting software, it’s important to take into account these key factors that will ensure the success of your decision:

  • Reporting capabilities
  • Planning and forecasting capabilities
  • Complexity of the tool (learning curve)
  • Flexibility and scalability of the tool
  • The integrations with other systems
  • Level of support offered by the vendor
  • The cost-benefit ratio of your investment

While it may seem that financial forecasting software is mostly suitable for large corporations, that is not the case. Even as a small business, you will greatly benefit from forecasting tools. As there are many solutions available, ranging from basic tools in accounting software all the way to dedicated business planning solutions, you need to ensure to choose the one that will have the biggest impact on your company. We’re happy to provide you with a few questions you should ask the forecasting software vendors you are considering.

Can the software integrate with your other systems?

Integrations are essential to any software platform, and they’re especially important for forecasting, so you can import data from your other systems. Enquire about standard connectors as well as the ability to create your custom integration through an API or other means.

Can you test the software before buying?

Some software vendors offer free trials of their forecasting software. Other software providers will provide a live demo to answer your questions. Both are perfect opportunities to test the most essential features, so you can determine if the software meets your requirements and is easy to use.

What security does the solution provide?

Your financial integration should never compromise the integrity of your business or your compliance with national and international laws. Make sure to research each forecasting software solution on your shortlist to see what level of security they offer.

What is included in the pricing?

Your budget is an important factor when choosing financial forecasting software, so you should think about that at the very beginning of the process. Some software vendors charge only license fees based on administrators and managers, while other vendors may charge each user. Ask vendors what is included in their price and what may be charged extra, such as for additional support and customisation.

What services are provided regarding data quality?

Correct and reliable forecasting heavily depends on the source data to be consistent, accurate, and relevant. Ask software vendors how they can help you with any transformation, mapping, or reprocessing of your data. For example, do they offer consulting on forecasting models and processes, or data cleansing and validation?

Be diligent

Do you want to learn more how to compare forecasting solutions and the key differentiators in leading forecasting software?

Download our Comparison Whitepaper or request a personal demo.

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