Sales are of utmost important for businesses of all sizes. You need to sell products and services, earn profits, grow revenue, outreach globally, gain brand recognition, acquire new customers, and much more.
Do you think meeting with clients, devising an effective sales winning pitch, and communicating this to the client will be sufficient enough to close a higher number of sales?
Your business still needs advanced techniques to close a higher number of deals effortlessly, and to optimize the sales process, reduce the business expenses, and run the business for a long term.
Sales forecasting is one of the effective advanced methodologies to streamline the sales procedure for a better sales planning in the coming years.
What is sales forecasting?
It is a process of determining the estimated company revenue for a defined time period, say for example, on a weekly, monthly, quarterly and yearly basis. Usually, a company conducts sales forecasting by taking into the account the previous sales data, current targets, and the number of quotas achieved in the last financial year.
However, the sales department conducts sales forecasting at different levels.
For example, the sales managers of individual representatives carry out forecast to predict how much business their team can close in the future. The sales directors’ conduct forecast to estimate the sales for the entire department. And the sales management uses sales forecasting valuable insights to analyze the future sales for the entire organization.
The generated sales forecast reports are shared with company leaders, board members and stockholders.
Importance of sales forecasting
Sales forecasting is highly important for any business to make an accurate and informed business decisions and to estimate the company’s future revenue.
By knowing where your company is headed in the future in terms of sales, you can help your business to easily identify your strengths and weaknesses before you finalize your budget and marketing plans for the next year. It also allows you to optimize the purchasing and marketing plans.
Are you planning to implement sales forecasting for your business?
Then, it is better to utilize the services of customer relationship management (CRM) software for accurate sales forecasts.
Here are a few strategies on how to use the CRM software for accurate sales forecasts:
1. Systematically organizes the sales data
Usually, businesses conduct sales forecasts based on the past sales data present in CRM system. Therefore, it is important for the sales team to maintain a crystal clear, accurate and up-to-date sales data on deals and opportunities in CRM system.
Any incorrect data can lead to skewed forecast predictions that can have a direct impact on future sales and business planning. Ultimately, it is the responsibility of sales management to maintain the data quality in CRM system.
2. For a better business planning
It enables you to provide valuable insights about your sales team performances and also helps to gain knowledge about the potential sales deals currently available in the sales pipeline.
However, sales forecasting data helps you to figure out the top sources for lead generation and facilitate resources to the most profitable sales campaigns. Analyze the sales team’s performance in comparison with previous periods, monitor and increase the sales team productivity from the bottom line, discover the reasons for any lost sales, and view the sales funnel conversion rates.
Overall this helps to design the best future business planning based on current sales forecast data.
3. Make it simple
Conducting sales forecasting on a regular basis can kill the time of sales people and distract them from selling process. Therefore, it’s better to have specified timings for sales forecast.
Through sales forecasting, you can discover potential issues such as pitfalls in your latest marketing campaigns or your new company business plan fails to generate profitable revenue. Meanwhile, sales forecast plays a pivotal role in hiring, resource management, goal setting and budgeting.
However, to conduct the sales forecast data needs to be accurate and up-to-date and sales leaders should take the responsibility of maintaining the data quality.
4. Take the full advantage of CRM system
A CRM is a crucial tool for businesses to learn and understand more about your customers, their current needs, interests and preferences.
Do you use CRM as a simple address book to record and analyze customer details?
Are you using the CRM system to its fullest potential, gaining total analysis on company history and data processes to conduct sales forecasting on regular basis?
As information is power, utilize the cloud CRM software to its fullest potential to find out how much profit you’re currently gaining, the number of deals and opportunities in the current sales pipeline and the information about new business leads.
Use this analysis to conduct a reliable and accurate sales forecast.
Apart from implementing the above techniques, you should train your employees on CRM system. You have to provide training sessions on how to equip the information and accurately conduct sales forecast. Your employees should get the in and out of your CRM system.
In conclusion, the sales forecast summary data can be used to identify the top performers within your team, determine the strengths of each sales person based on the number of targets achieved, and set higher and realistic sales targets for the next financial year.
Take advantage of sales forecasting and plan your business future and estimated revenue in coming years effectively.