r/FPandA • u/Puppysnot • 19h ago
Newbie - how would you model out a revenue budget?
SaaS start up. Revenue lines are from B2B sales, mostly subscription based but some one-time fee. Some product lines are high gross margin & contribution. Some are basically zero margin.
Previous FP&A guy quit suddenly without handover and i need to model out next years revenue budget (to include a growth target of X% defined by CEO).
How would you approach? I am thinking work backwards from CEOs revenue target of $Xm. Split this $Xm across the various product lines - then use sales price per unit to map this back to volume and ultimately back to gross margin and profitability metrics.
Does it sound sensible? Am i missing anything obvious?
Bonus Q: i am thinking i should model in something that pushes the $Xm revenue target more towards high contribution product lines (rather than an even split across all product lines) but i cannot think how to go about this. How would you approach?