Definition

Deciding how much to charge for a product or service based on costs and market trends. A clear plan helps attract customers while still making a profit.

What to consider

  • Include all costs in the projection.
  • Use conservative estimates.
  • Compare projections with actual performance for adjustments.

Real world scenarios

  • A restaurant owner in Boston projects next year’s profit by considering expected sales and increasing labor costs.
  • An e-commerce business estimates future profit margins based on seasonal sales trends.
  • A consultant calculates projected profits from a new client contract before signing.

Related terms

Entrepreneurial Finances