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Developing Sales Forecast

If you operate an established sales business, then the best data that you have access to in order to run a sales forecast is historical data. The sales figures for over the last few years will provide you with a good indication of how the business is going to perform over a given quarter.

Historical data should give you an indication of how many new customers you are likely to acquire and how many will drop off. This will in turn feed into how much marketing and sales activities you will to do in order to win new business.

You should look to break down historical data into customers and product lines, to understand which customers bought what products and how many of each were sold. By focusing on more profit product lines this will enable you to generate more revenue with the same amount of effort.

If you are starting a new business, then sales forecasting can be a bit more difficult, as you do not have access to historical data. However, you can analyse the following in order to try and estimate sales figures for a given period:

• Analyse competitor sales data (If its available)

• Carry out market research

• Seasonal trends in the market you operate

All of this data will give you a good indication of the likely sales figures you can achieve in a quarter. It’s important that you make conservative estimates about the growth of the business, as overestimating could cost you down the line.