How To Build and Optimize Sales Forecasting Templates

Sales forecasting is a critical business function for every company, but sales forecasting templates and tools most definitely aren’t one-size-fits-all. The key to successful sales forecasting is to continually improve the methods you use so that the forecasting model evolves to fit the unique needs of your business.

Using an evolving sales forecasting models doesn’t mean starting from scratch, though. There are some excellent free sales forecasting templates available online for businesses just starting to build their model. A few basic elements need to be in place for a forecasting model to even get off the ground, and even businesses with an established forecasting process should take time to regularly review and improve their processes.

The basic requirements of an effective sales forecasting model are:

  • Sales data from the past with numerical data about won and lost sales, broken down by sales rep, product type, and any other axis that can affect your future success.
  • A sales pipeline that includes data about each deal at each stage of the pipeline, including estimates of the probability of closing each deal.
  • Contextual data and strategic assumptions about the demand for your business’s product, and your ability to meet the market’s demand.
  • Processes for continual improvement, including input from sales reps, marketers, and anyone involved in the sales pipeline. Sometimes educated guesses prove to be the most useful data for sales forecasting.

Sales Data Tracking

Tracking sales data from the recent and distant past can help you see which sales tactics are working best, which sales reps sell the most, and which marketing channels are driving the most growth. Many businesses track this information with a relatively simple Excel spreadsheet or dashboard, and there are plenty of free templates that offer a good foundation on which to build your own forecasting model.

XL Dashboards Sales Forecast Charts: XL Dashboards offers video tutorials and example spreadsheets for how to build excellent sales forecast sheets with easy-to-read visualizations comparing any sales metric you want to input.

Tableau Software’s Sales Dashboards: Visualizing sales data is often the best way to tease new and useful insights out of it. Tableau Software offers an incredible range of data analysis and visualization tools for sales data tracking and forecasting.

Insight Squared’s eBook on Data-Driven Sales Forecasting: This ebook from Insight Squared offers strong advice about choosing data to track, creating a clean and easy-to-update tracking system, and deriving actionable insights from the data.

From Misery to Mastery: How to Build A Better Sales Forecast: This ebook from Right90, an enterprise sales forecasting provider, outlines some of the biggest mistakes companies make with their forecasting models, and how to fix them with better data and more stakeholder collaboration.

Starting with a template and a set of instructions might be easier than starting with nothing, but every company is different. If you start with a template, be sure to stay on the lookout for improvements and customizations that can really make your forecasts work for your company.

Using Your Sales Pipeline & Market Research for Better Forecasting

A sales pipeline can make life a lot easier for sales reps by providing a structured system for turning qualified leads into repeat customers, which is great for sales forecasting. Studying each deal’s progress through the stages of the pipeline, and examining each outcome, can provide insights into the sales process that are incredibly useful not only for sales forecasting, but for improving sales overall.

“Your Sales Pipeline Is NOT Your Forecast” – Engage Selling: This blog post from Colleen Francis on the Engage Selling blog offers some powerful advice on how to interpret information from your sales pipeline to dramatically improve the accuracy of your forecasts.

A 6-Step Plan to Manage Your Sales Pipeline: Even though the sales pipeline and the forecast should be distinctly separate systems, the data from each can be used to improve the other. This post from the Baseline blog shows how CRM systems that offer both forecasting and pipeline management tools can be the most useful way for businesses to refine their own forecasting strategies.

Sales Forecasting Methods from Tenato: Understanding which market factors influence your sales the most, and how to incorporate that information into your forecasts, is crucial. This post discusses three methods of sales forecasting that can be mixed and matched for the most accurate results.

Continually Improve Your Forecasting Process

Setting aside regular times to examine your sales forecasting model and find ways to improve it will yield major dividends over time. Following up on errors and inaccuracies will lead not only to a better forecasting model, but better sales processes and more sales.

Inc’s 7 Tips for Improving Your Sales Forecasting: This blog post by Tim Donnelly offers excellent advice on how companies can examine their sales forecast’s effectiveness, and tweak it to improve performance.

SalesClic’s 5 Tips to Improve Sales Forecasting: The folks at SalesClic offer a few easy-to-implement tips that are backed by research for making modifications and improvements to an existing sales forecasting process.

Four Principles for Great Sales Forecasts: Whether you’re building your sales forecasting model from scratch or refining an existing system, these four principles from Forbes writer Scott Edinger are worth keeping in mind.

Intentionally improving your sales forecasting model will start a positive feedback loop in which your forecasting insights improve your actual sales practices, and data from your sales process in turn help you to improve your forecasting.

In the end, only practice and continual, intentional improvement will yield the best possible sales forecasting system for any particular company. The key is to keep finding ways to marginally improve the system in ways that will add up over time, and the resources listed here can help out a lot with that.

Happy Forecasting!

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