As soon as we know our sales target for the year, most of us start to think about how we will achieve it. “Which contracts are likely to close?” “Which look risky?” and “Do I have a sales process to help me?”
We feel good about sales forecasts when they look achievable but we worry if they look challenging. Quite often we ‘play safe’ and forecast low to avoid disappointment. That might sound prudent but it can also be the cause of problems. Other operational decisions might be based on our estimates. There is no substitute for accurate forecasting.
While running some sales coaching programmes recently, I noticed some people have real concerns about the sales numbers they have been given. There is special worry among those who are selling into the public sector, because they fear heavy cuts in public spending later this year. In the private sector, many feel costs have already been trimmed to the bone and leaders expect a strong drive to increase sales and raise performance. This is certainly supported by findings in the new 2010 Miller Heiman Sales Best Practices Study.
Sales people are under pressure to perform both from their customers and from within. It has never been more important to qualify the sales you want to pursue.
- Identify the real opportunities
- Qualify them properly
- Cover the bases in more detail
- Fully understand your customers’ buying process.
- Use Valid Business Reasons to differentiate your sales approach and to convince decision makers to see you.
The Miller Heiman 2010 study suggests accurate sales targeting is essential to create accurate sales forecasts. Because sales forecasts that are too high or too low, often lead to the misuse of resources and poor investment.
It’s not just about how you forecast sales. It’s about sales strategy. That’s why in our sales training programmes, we work with the participants to make sure they understand their customers’ business first. Whether you’re forecasting on profit, volume, billable hours etc – it’s accuracy that counts. Get it right and help leaders make critical decisions. Get it wrong and it affects everyone.
Now I would like to hear your thoughts about your approach to sales forecasts.
Are you given a number from elsewhere in your organisation?
Do your customers have a better a view of how much business they are likely to do with you?
What makes a sales forecast accurate?
Please add your comments here.