Any accurate sales forecast is a guaranteed gift towards your bank balance, your sanity, and your stress levels!
A truly accurate sales forecast means you know where you’re going, and how you’ll get there. Easy sailing…
So why do so many sales people and business owners fail to use the sale forecast to their advantage?
An Accurate Sales Forecast – Urban Myth or Unicorn?
I genuinely believe no-one really subscribes to the actuality of an accurate sales forecast.
This is simply because both you and I have all seen great sales forecasts fall apart. We’ve seen them fall apart probably on more than one occasion. Often just one week before month end! That happens.
So, you might suspect that when you drop a prospect in the sales forecast that it’s a best guess…because that’s what lots of sales people do.
And that’s where it starts to go wrong. An accurate sales forecast is not a best guess.
It’s a document of record.
I guarantee if you start to think about it as such, you’ll find a huge difference in terms of you being able to predict your sales success. This means you’ll find it easier to hit your target and predict your sales growth…and take control of your earnings.
What Does an Accurate Sales Forecast Look Like?
|Confirmed Order Details w Decision Maker||Uncovered Specific Needs||Solution Agreed||Prices Agreed||Budget Available||Date to Sign Off Agreed||Delivery Date Agreed||Contract Sent||Purchase Order Received||Invoice Date||Order Value|
|Jelly Bobble Inc||√||√||√||√||√||√||√|
I like this format because it focuses the sales persons mind, and also, it’s easy to see the solidity of the deal at a glance.
I’m not only advocating this template as a formal document, I’ve seen it used very successfully as part of self management. It’s a great self reality check for how solid a deal is, but that’s not the most powerful part of this template.
By far the most valuable element is that it forces you, as the sales person, to ask those sales based questions that can often just pass the sales person by.
But, you see, it’s these very questions that make the difference between a sales forecast and an accurate sales forecast.
And that means the difference between solid stable growth, predictable sales performance and a stress free sales environment and a hand to mouth, peaks and troughs sales sea saw…no, which would you rather have?
Building an Accurate Sales Forecast = Asking Structured Questions
You might want to check out some of the recent BANT articles I’ve written here about how to qualify prospects…Why Sales BANT is Not Enough and Has Anyone Seen My Buyer? because they’ll give you a broader understanding about the value of asking those qualifying questions that are critical at the end of the sales process.
Good Quality Questions Create Accurate Sales Forecasts
Here are some of the key questions you mighty consider.
It’s important to look at the format, the detail and the accountability you are conferring to your prospect to work with you, honestly, openly and with a high level of transparency:
- So following the template above, when you’re thinking about creating your accurate sales forecast it’s perfectly acceptable to ask and re confirm the following, through all the stages in the sales process:
- You’re the person who will make the final decision on this? Will that decision need to be signed of by anyone else? Who holds the budget for this purchase? What part do they play in deciding who to buy from?
- We agree that the costs associated with doing nothing provide a clear and definitive ROI using our solution/product/service?
- That if, as discussed we provide you with the solution/product/service as discussed at $£X then you are happy to buy from my organisation?
- And that budget is available now? /And that budget for this purchase will be signed off by dd/mm, so you can get delivery by dd/mm then we can agree I can go ahead and raise a contract so you can send me a purchase order by dd/mm…?
Why is this Important?
It’s important because you as the sales person gets to see where the variable or undecided factors are, most often this will be around timing, but not always…
Using these questions and the template above you know exactly how solid a prospect is, and what detail you need to chase down to convert a prospect to an order.
What Else Contributes to Inaccurate/Accurate Sales Forecasts?
Think about these factors and reflect on the impact they could be having on your sales forecasting ability…
- Qualifying is not a one time event. Qualify and re-qualify as often as you need but especially when there are changes taking place. Be that shifts in time scales, new people entering the discussion, shifts in agenda etc
- Don’t rely on your sales CRM to forecast for you. In the main I’ve found sales CRM sales pipeline generation and management the cause of much distress and false hope. Use it, but have the reality check on high alert.
- Use your judgement. If a deal wobbles a few times, starts to drag, the prospect avoids your calls, then read the signs. You need to get involved and re-assess. Trust me, a great prospect is never that busy to return a call.
- Honestly is critical in your sales forecast. If you insist on fabricating, padding or listening to your ego, then you’ll find people losing faith in your pretty quickly. Your judgement is flawed and your word’s not to be trusted. That’s not a rep you want.
- You need to get smart about new business development. That way you’re not tempted to hang on to dead deals, and chasing prospects who’ve died on you.
- Accountability – state your numbers, commit your focus and own it. No shirking. Don’t be that sales guy!
- If things are going pear-shaped – go talk to someone. Don’t put your head in the sand…get a 2nd view and draw up an action plan. Don’t panic, or start discounting or give up…
Now Consider This
Dropping a prospect out of your sales pipeline is acceptable. It’s much better to do that than cloud a picture where you need absolute and razor sharp clarity.
You’ll find the clarity especially when it comes to working out your Sales Recipe
If you can get clarity in this one area, you’ll find your ability to fully turbo charge your sales efforts, and therefore your sales results, and therefore your sales bonus!
So, in summary, an accurate sales forecast is neither an urban myth or a unicorn, but it is magical in terms of what it can mean for your business, your bonus and your sanity.
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