Investors would like to understand how you expect and plan for sales volumes to develop. Sales forecasts help you to develop your medium-term revenue projection (needed if you seek external financing) Sales forecasts bring a level of clarity to future delivery volumes and help you plan your own procurement and production schedule and avoid supply-chain shortages. Given the resources you commit to sales and business-development activities and the length of time a sales process can take, you do not want to lose an order because you cannot deliver on time. Sales forecasting assists in planning your procurements, production and logistics capacity They wound up unable to meet their financial obligations despite having a business that could have been sustainable over time. Suffice to say, many companies have gone bankrupt because they did not adequately plan their cash flow and liquidity. Sales forecasts help you to understand and manage your cash flow Three reasons why startups should prepare sales forecasts 1. The effort of capturing this information is not onerous, and the return value upon analysis of the data is tremendous and essential to the success of your company. ![]() (Metadata is data about your data-in this case, it is the collected body of statistics about your sales activities, including cold calling, deals closed, expenses, and so forth.) Because startups typically have little metadata to work with at the outset, it is vital to systematically capture this data. ![]() Sales forecasts are based on capturing and analyzing metadata about your company’s sales activities. A sales forecast is essential not only to understand and manage sales activities, but also to facilitate the growth and development of the entire company. A sales forecast is a projection of what your sales revenue will be for a specific period in the future-for example, the next month, quarter or year. As soon as your startup begins regular sales activities, it is important to create periodic sales forecasts.
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