Do you hate ambiguity as much as we do? Then let’s talk about ways to avoid any type of uncertainty at all costs!
Ambiguity gets on everyone’s nerves, especially when it’s about business. When you operate your own business, you want to know how the machine works from inside, what people think, what they use, how they spend their money, how you can estimate your future revenue, and how much you will get in a particular period of time. All these wishes are common among those who want to gain money and become the future Jeff Bezos.
But how can you know what will happen in future?
Well, fortune tellers will help! Or… Or you can forecast sales and know everything in advance! As you can understand, this article is all about sales forecasting and how you can help your business by doing it!
Definition
Sales forecast is for businesses who want to estimate their future sales revenue. In other words, instead of going to the fortune teller, you forecast your sales and see the bigger picture of what awaits you in the future.
Sales forecasting is based on various elements that exist in our life. For example, the results of a sales forecast depend on the industry, different trends, tendencies, data and history. In general, if you want to know your future sales revenue, you can do that for different periods of time: week, month, year…
How to Prepare for Sales Forecasting?
If you’re excited about sales forecasting and want to conduct your own, you have to first of all prepare your business for the predictions. Starting the forecast without any preparation is like going to war without weapons! So, you’d better get ready for the hardest part!
Document It Before It’s Too Late
First of all, you need to get your paperwork ready. We know, no one wants to do that in the first place, but let’s be honest, everything starts from formalities and papers. These documents should perfectly demonstrate your sales process, how many sales you have, their number and other details that are related to your transactions. As it is often said, “paperwork will ruin any military force,” and that’s partly true…!
If you want to predict sales, you need to have at least a bit of data! Without it, you (or sales forecast specialist) won’t be able to get the bigger picture, and therefore, won’t understand what to expect!
What Do You Really Want?
To forecast sales, you need to establish a certain goal. How much sales do you predict, and how much do you expect to have? If you don’t have any expectations, how can you predict anything? You need to have your own impression of “good,” “profitable” and “cost-effective.” Besides, “when you know what you want, and want it bad enough, you will find a way to get it.”
Understand the Direction Your Moving In
To understand how you work, the direction your moving in and to simplify the process of sales forecasting, you need to ask yourself the following questions:
- What do I know about my customers?
- How much time do they need to show their interest in something that I sell?
- How much do I really convert when selling my products?
- How much time do I usually need to bring negotiating to an end and to reach an agreement?
- How much do I get after all?
- Do I have customers that return to buy more products or services from me? Do I have data about these people?
Now that you know to prepare for sales forecast, you need to use the data you have, find the common trends, tendencies and inclinations and start the prediction process!
Sales forecasting is a quite difficult process which should ideally involve tax specialists, market professionals, financial advisors and people who are able to analyze numbers! Small business owners usually do it manually, which is however, not very clever, especially in terms of calculations. Human mistakes are worse than anything in this world: if you make a mistake, you’ll have to redo everything from the square one.
Certain companies like us offer exceptional sales forecast software that help business owners accurately predict their sales. If you want to see your future, see how bright it is and how many sales you have, contact us and we will provide you with the best sales forecasting eCommerce service!