With a new year on the horizon, your team might be gearing up for sales forecasting. This is a time to reflect on past performance, review trends and anticipate shifts that will shape 2025. Just make sure you focus on data rather than relying on your intuition. If you’re not looking at the data, you could end up making inaccurate forecasts and missing your targets.
Justina Thompson, a contributor to the HubSpot Sales Blog, says sales forecasting should be used to identify and exceed realistic targets based on solid data. Otherwise, you might end up disappointed when you can’t effectively measure revenue targets, progress or other key performance indicators.
In this issue of PromoPro Daily, we share Thompson’s guidance on how you can improve your sales forecasting for the year ahead.
Use historical data. You need to know where you’ve been so you can accurately forecast where you’re going, Thompson says. Looking at historical data can give you a solid foundation for setting next year’s numbers.
Keep clean records. Dirty data won’t help you. Make sure sales reps are on the same page by providing ongoing training on CRM use. Thompson also recommends regularly discussing the sales forecast in team meetings and performing spot checks on records and deals to identify any inconsistencies.
Start with a simple model. The fewer variables to track, the simpler it will be to gauge how well your sales forecast is working. You can then update it in the future with more variables.
Implement a sales pipeline action plan. For sales leads, Thompson says quality is more important than quantity. Try to build an action plan to generate the minimum number of leads necessary.
Use forecasting tools. You don’t need to start from scratch. Explore the many forecasting tools available that can give you the information you need.
Incorporate “what ifs” and qualitative data. Thompson says it’s a good idea to ask “what if” questions that you can answer once you collect more data. Try to look at your promo business from different angles.
Consider seasonality as a factor. Does your business have a busy season? According to Thompson, if your forecast is linear, you may lose accuracy if you treat every month and quarter similarly. Keep seasonality in mind.
Encourage collaboration between all departments. A well-constructed forecast often involves multiple departments. That’s why Thompson says forecasting works best as a team effort. Different departments have their own expertise to offer, which gives you a more well-rounded forecasting process.
Hope for the best and prepare for the worst. What if you lose 3 of your top performers? What happens if you have to re-evaluate your whole sales process? While you don’t need to envision every possible bad scenario, Thompson advises leaving some cushion in your forecast that accounts for potential setbacks.
Regularly reference your forecasts. Use them as you make various business decisions throughout each quarter. And remember, Thompson says, it’s never going to pan out exactly as planned. Expect some give and take between your projections and actual figures.
Without data, you’re essentially navigating in the dark. Include data in your sales forecasts to set achievable goals and turn insights into action.
Compiled by Audrey Sellers
Source: Justina Thompson is a junior staff writer for the HubSpot Sales Blog. She specializes in sales and marketing topics.
