If you’re looking to improve your sales forecasting skills and learn what future sales you can expect for your business, I’ll get you started in no time – I promise.
Indeed, a good sales forecast is essential if you want to know if you will reach your goals to get your commission or bonus (as a salesperson) or to cover your expenses (as a business owner).
I’ll quickly cover what sales forecasting is, how you can best do it, and which Excel template or specialized software you can use (I have both ready for you!
Here’s what I’ll cover:
- What is sales forecasting?
- What are the methods and armenia phone number data formulas available, including examples?
- How can I do this with the downloadable Excel and Google Sheets templates?
- How can I do this with a tool like Salesflare?
Let’s break it down.
A definition: What is sales forecasting?
Before we begin, let’s agree on what I mean by “sales forecasts.”
Here is a possible definition of what sales forecasting is:
Sales forecasting is the process are food blogs still an interesting niche? of estimating a company’s revenue for a specific period of time, most commonly a month, quarter, or year. It is a prediction of how much a company will sell in the future. Accurate sales forecasts allow companies to make informed decisions about resource allocation and budgeting.
If you don’t have an accurate sales g seo work forecast for your business, you’re flying blind. You don’t know if you’re going to hit your targets or if you need to cut costs and/or attract additional funding.
And if you’re an individual seller, it’s obviously a great idea to track your progress toward your sales goals.
How To: Sales Forecasting Methods and Formulas, Including Examples
There are many methods and I don’t want to confuse you with all of them. Instead, I will present you with a recommended method and then explain some alternative methods.
I will also show you concrete examples and/or formulas so you don’t need to do any more Google searches to understand how it all works.
Pipeline Forecasting Method (Recommended)
If you are new to sales forecasting and are looking to calculate a forecast that is both quick and accurate, you are probably best off using the “pipeline forecasting method”.
This sales forecasting method uses what you know about opportunities in your sales pipeline to estimate the amount of sales you are likely to close during a specific period.
It uses the following forecasting formula:
Forecasted Sales = Sum of ((Probability of winning an opportunity) x (Value of an opportunity)) for all opportunities with a scheduled closing date during the period in question.