One of the most common misconceptions in sales is that demand forecasting is complex. It’s actually quite straightforward – but it isn’t easy. With the right approach and the right tools, though, you can succeed in forecasting demand and maximising your profits.
Get As Much Data As Possible
The more up-to-date, relevant information you have, the better your chances of accurately forecasting future sales. Using well-designed sales tracking software can be a great boost here, allowing you to collect far more data than you could with manual data collection and with a lesser strain on company resources.
Make Use Of Previous Data
Take a look at how things have panned out in previous sales periods – this data is a highly valuable resource. You can use that information to inform your decisions for the future. Feed the data into your plans for product launches and seasonal campaigns to maximise sales.
Calculate A Forecast
Once you’ve crunched the numbers from the data you have, you can use that to create a forecast. Be positive and optimistic, but also remember to be realistic, as overreach can often be the downfall of an otherwise successful business.
Think About Special Events
Are your company’s sales likely to be significantly affected by events such as Easter, Halloween, or Mother’s Day? Looking at your daily volume profiles going back a reasonable number of years, you can use that data to auto-create volume profiles for special events for the coming year. Remember that certain events, such as Easter, aren’t on the same day each year.
Communicate Well With Suppliers
Incoherent or inconsistent requests to suppliers can cause major problems, including stock shortages and untimely delivery. Make sure all your suppliers are clear about what you want from them, what quantities you require of each item, and when you want them delivered. Bear in mind both manufacturer and supplier lead times to ensure smooth operation.
Keep Collecting Data
To continuously improve the quality of your sales forecasting, improve the amount of data you have to draw on by continuing to collect incoming sales data. The more you have, the easier it will become to anticipate changes, or to spot potential issues before they cause significant problems.
Expect Ongoing Adjustment
Sales conditions don’t stay the same, and forecasts are unlikely to be perfect, owing to unforeseen changes, both large and small. Always be ready to adjust your sales strategies and tactics based on the information you receive from updated data.
With Reflex Planning’s sales forecasting software, you’ll be able to gather and collate data in ways that give you focused, accurate information on which to base your sales decisions. Get in touch today to arrange a free product demo.