The sales forecasting is the process of estimating how much of a particular product is possibly to be sold in a specified market at the specified price in a specified period of time. A sales forecast period can be monthly, quarterly or annually. You may consider sales as income or revenue.
Near realistic sales forecasting is essential for businesses to manage its production and/or services without problems. The entrepreneurs need to make assumptions at the business setup but they can make better assumptions or forecast after they have some trading history in the 2nd year on. The sales forecasting helps you in completing your budget and cash flow forecast and it can be used as sales target for the upcoming year.
You can use below checklist to help you forecasting your sales in the first year after startup. Checklist for sales forecasting
• Existing customers or contracts already signed
• New customers
• Events (national and international trade fairs, Olympic games, world championships etc.) • Gradual increase of sales in first year as the company becomes known in the market
• Seasonal fluctuations if applicable to your product/service
• Regulatory changes that may affect your product/service
• Natural ups and downs
You will experience seasonal fluctuations if applicable to your product/service that are led by customer/user demand and create ups and downs, busy times and quite times throughout the year.
You can use below table when you prepare your first sales forecasting after setting-up your business. Please consider seriously above checklist when filling out your monthly sales forecasting as they may affect dramatically by the time of year. You should also consider other events not specified in the checklist such as religious celebrations (Christmas, Easter etc.) or school holidays (or coronavirus pandemic) that may also affect the sales.
