For entrepreneurs, regardless of their size, selling online provides access to a huge international market. The challenge is to stand out in the market and find the company's competitive advantage .
In fact, a Nasdaq report revealed that e-commerce will facilitate 95% of purchases by 2040. This sales projection is especially optimistic for the technology, fashion, food and great britain email list transportation sectors. For experts, the majority of transactions will be made through mobile devices, due to their speed and convenience.
If you want to predict your revenue and make better business decisions, you have come to the practical guide that will help you. Here you will find:
Sales forecast is a projection of future revenue. Based on data from previous periods or industry trends, the effectiveness of a company's marketing efforts in the short and long term can be predicted.
Some people prefer to forecast a company's sales in Excel, while others choose solutions powered by artificial intelligence . Whatever your case, it is essential that the data collected is up-to-date and accurate . That way, variations will be minimal.
Keeping track of your profits, losses, and opportunities is critical to the financial health of your business. Deepen your knowledge on the subject with this article: What is sales control and why is it important?
What is meant by sales forecast?
When a person uses the term sales forecast , they are probably referring to the estimated revenue that an organization will generate in the near future.
In this context, what is meant by a company's sales forecast is its ability to observe and interpret financial trends from internal data and industry behavior to estimate how its business will perform in the coming months.
Do you want to understand the advantages and disadvantages of an automated sales forecast? Read: Sales control system: what is it and what is it for?
What is a sales forecast for ?
Sales forecasting helps you anticipate consumer behavior and guide strategic decisions. It also helps you make smart investments and evaluate the performance of your salespeople.
1. To anticipate consumer behavior
Although there is a margin of error, sales forecasting is an important tool for anticipating consumer behavior and managing your company's resources wisely. If you overestimate sales, you start spending money you don't have. If you underestimate sales, you're left unprepared to take advantage of opportunities.
Now that you know what a sales forecast is for in relation to consumer behavior, we recommend reading: How to anticipate customer needs in 5 steps .
2. To guide strategic decisions
In other words, a company's sales forecast helps you guide strategic decisions that will potentially impact the success of your business. If you know that people aren't buying yellow t-shirts, but instead are looking for blue pants, it might be time to reconsider your approach, get it?
3. To make smart investments
According to Zendesk’s 2021 Sales Trends Report , nearly 40% of SMBs consider scaling their operations efficiently a priority. In that sense, sales forecasting serves to identify promising areas that deserve more attention and investment, as well as areas of the company that no longer need as much money.
When the topic is what a sales forecast is for, you are already an expert. Expand your knowledge with this article: Sales budget: 8 models to organize finances .
4. To evaluate the performance of the sellers
Did you know that the percentage of salespeople who meet their quotas has dropped from 63% to 53% over the past six years? Having a sales forecast allows you to evaluate salespeople's performance and make changes at the right time to ensure the financial stability of the company.
What element makes up the sales forecast?
A company's sales forecast consists of 6 elements: analysis period, product, available units, sales price, total sales and percentage of total. Here's what this means:
1. Period of analysis
The analysis period refers to the time period for which your sales forecast is valid and/or based. It can be defined in months, quarters, semesters or years, depending on what you want to know. For example: January-February; March-April.
Product refers to the item you sell in your company and for which you want to make a sales forecast. For example: blue pants; white refrigerators.
3. Available units
As the name suggests, units refer to the unitary quantity of products available. If you sell blue trousers or white fridges, as we mentioned in the example above, you should be able to easily get this information in your stock software.
