The short answer is that sales forecasts are estimates of what your business is going to be in the future. It’s the process of predicting sales for a company or individual. Forecasting tools can be leveraged to help companies fully understand the factors that affect the outcome of their sales forecasts.
Forecasting is an integral part of business and people management. It’s what allows you to make informed decisions, an not be surprised at the end of every quarter. Forecasting is effective, but it’s dependent on accuracy.
Historic data is critical to forecast accuracy. Without historic data you have no way of comparing, contrasting or analyzing where you’ve had success, and where you haven’t.
Pipeline velocity can also play a key role in sales forecasting. The equation for pipeline velocity draws attention to factors that impact your forecast and make you aware of things you can control and adjust to ensure your sales forecasts are accurate.
