Just like you want to plan for everything ahead, sales forecasting takes care of the projection process of any product’s behavior. Forecasting in simple terms means predicting or estimating or planning ahead for or about the future or trend.
So the same way we apply forecasting in our daily life it’s the same way we should apply it in business. If you need to grow your business you need to plan and forecast ahead of it. Forecasting for your business, helps you get a detailed prediction of what an individual salesperson, sales team, or your entire organization, will sell in a given time period whether weekly, monthly or annually. It gives you a picture of a future you can then build on it.
What is Sales Forecasting?
Sales forecasting basically refers to the process of predicting and estimating future sales using actual sales data from your sales organization.
For salesmen who are promoting a new product, sales forecasting helps you to know whether you will find the market for your product or not depending on the earlier arrangements made. Sales forecasting can also help you get investors to back up your business with additional funding thus promoting its growth.
According to Aberdeen Group, forecasting sales for your business can help your company grow revenue by up to 10%. If you want to do the best sales forecasting for your business, have the right information and then focus on driving its growth.
Sales forecasting doesn’t require having a certain class of qualifications, it needs you to have a well estimated guessing as a business owner, salesperson or an individual who has been in the business for quite a number of years.
Of course, to make a good sales forecast you need to have good and reliable data about what is trending on the market with respect to what you are offering and what other competitors are doing on the market.
Sales Forecasting strategies
There are many ways and strategies that can be adopted as shared below:
1. Acquire accurate CRM Data data.
Having the correct customer relationship management data helps you to keep track of your customers’ feedback. This is important for your business growth since it provides you with details about the behaviors of your customers, their interests.
2. Let your forecast be real and accurate.
Don’t overestimate your forecast. An accurate sales forecast should be kept simple, precise and accurate. An overestimated sales forecast becomes an overwhelming target and the sales team might look at it as unachievable. You also end up taking away critical selling time, which hugely diminishes the sales team’s ability to deliver a sales forecast. Nothing turns salespeople off more than making it time-consuming and tiring to forecast. Having to forecast too frequently or making the process overly tasking means it doesn’t get the sales team’s focus or the attention it deserves thus tour business targets might not be met as expected.
3. Setting Sales Projections
Projections simply refer to the estimated sales that you hope to make in a certain period whether daily, weekly, monthly, quarterly or annually. Projecting business sales helps the sales team to work harder and ensure that the set sales forecasting projections are hit. It creates a more organized way of working for the team and this one of the most important things in setting sales strategies for your business.
4. Ensure the accuracy of your forecast.
Without having the right information by your side especially when dealing with forecasts, it would lead your business into failing. Having the right forecasts helps your business set out as expected or as planned accordingly. Have your key performance indicators to help you sieve what is more likely to work for you and what is not likely to work for you. This one of the most effective ways of setting the best sales forecasting strategy.
5. Estimate and set prices for the goods your business produces.
Go out in the market, collect data about what your competitors are doing. Look at the products they producing. What prices do they charge for their goods? The quality of their products as compared to yours. Then set prices depending on what is trending on the market and make sure that your prices are not set too high while your competitors’ prices are low. If that happens probably your product will be left out on the market so you got to set your prices averagely.
6. Train your sales teams about the sales forecasting methods.
Implementing sales forecasting without the sales teams is a wastage of time since the sales team is always in the field implementing what was discussed by the administration. Including the sales team helps them know which methods are actually going to be used to ensure that this forecast is achieved as expected and how these methods can actually be put into practice.
7. Separate each commodity from the other following different lines of sales.
If you are a producer of different goods, then you must separate them and sell them according to their different categories. For example, if you are a producer of detergents but with different brands, categorize brands accordingly and sell them differently but not simply mixing them at once. This gives a classic and unique look as well as good organization and this is key to succeeding in forecasting for your business.
8. Gather the right and accurate data about the previous performance of your past brands.
Before you predict or estimate or plan ahead of something whether in the field of business or in the normal daily life, it’s always good to gather data before you take another step. Gathering data before doing anything else helps you to know what worked out well for you and what didn’t work out for you so that you can find out means of improving what worked well and ways of maintaining appropriately what worked for you and how it worked out. This is one of the most important aspects of forecasting for your business.
9. Create a clearly defined sales process for your sales team.
Having a well-defined sales process for your business is crucial for its success. A sales process is like a guide to the sales team of what they have to follow from the time of identifying a potential customer until the time a customer is turned into a fully convinced potential buyer.
Monkeypesa breaks down for you the best sales management system that your team can implement as one of its best sales forecasting strategies to help you in understanding sales the more and suitable to boost your business’ growth.
- Identifying and Prospecting, Prospecting is the process of sourcing and identifying new leads or clients to begin working through the sales process.
- Connecting and Qualifying, The connecting process involves representatives initiating contact with those early-stage leads to gather information. Qualifying new leads involves deciding whether or not they’re a good fit lead for your business and whether or not they will likely move forward in the buyer’s journey.
- Initial meeting, This involves scheduling the first appointment with the leads after confirming that they have fully qualified.
- Researching, Researching involves representatives knowing more about the prospect by digging deeper, when representatives learn more about each prospect and company, it allows them to offer a more tailored and personalized experience and improves the likelihood of closing a deal.
- Presenting, This involves a salesperson running a formal presentation or demonstration of your product or service for your prospect on how he or she will benefit from it.
- Handling Objections, This involves listening to the prospect’s objections and questions from prospects; this helps representatives to drive your product or service to fit the needs and wants of the prospect.
- Making an offer, negotiating and finalizing, When the needs of the prospect are understood, then you choose to make an offer or not but once you choose to make an offer then you will need to negotiate the final terms and conditions.
- Closing the sale, This involves coming to a conclusion or reaching an end by the prospect and the representative. The close step is what every salesperson works toward. This is expected to result in a mutual benefit and a contractual agreement between the prospect and the seller.
- Deliver the product, This is the very last stage in closing a deal where the representative delivers the product or service to the customer physically.
10. Integrate your past sales forecasting data with the current being planned forecasts.
Looking back into your past is crucial for all businesses especially those that have been in existence for quite a number of years and by means of their operation, they keep producing and implementing new products on market. If you have a product that was previously on market, look back and see how you made it to successfully sale the product, look at how you made it go viral and insane to catch the buyer’s attention on the market, after analyzing all that see how best you can forecast your strategy and use the same methods to promote the product to come or to be soon released to the market.
11. Know what it takes to turn prospective leads into buying customers
This basically looks at your marketing channel that is the buyer’s awareness and consideration of a product or service from initial contact until their decision to purchase. Bring your past customer’s experience in place, see what you have always done to catch their attention until they decide to buy, employ the same means you have always used if possible until you get business from them. Remember scoring business is one of the most important things for the sales team.
Final thoughts and words
Sales forecasting needs a smart mind together with accurate data before it is put into real practice. There are several sales forecasting strategies you can employ as a business owner to grow your business as discussed above.
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