Set targets and forecasting for sales
Overview
This standard is about setting targets and forecasting for sales. The standard includes how to collect and use information to develop a sales forecast, based on past and present sales data, factors which influence or affect sales, sales trends, market conditions and development of products and services within your organisation. It also includes using forecasts based upon value and volume measures to develop sales targets. This standard is for sales professionals who set targets and forecast sales.
Performance criteria
You must be able to:
1. identify the appropriate metrics and sales forecasts required for setting the sales objectives and targets
2. identify and analyse sales trends and market conditions to forecast sales for a financial period
3. identify and evaluate internal and external factors that will influence and affect sales trends
4. analyse market conditions and potential selling opportunities to evaluate their likely impact on forecast sales
5. use historical sales data to inform new sales forecasts
6. evaluate a range of sales forecasting techniques
7. select the method most likely to give an accurate forecast of the financial period of time
8. use appropriate software and forecasting methods to prepare an analysis that will predict future sales trends
9. adjust opportunity close date and probability, allowing for sales work to be completed, history with customer, size of opportunity, type of customer etc
10. consult colleagues about sales forecasts and identify the implications for the organisation
11. make recommendations for sales objectives and targets
12. develop action plans based on sales forecasts and targets for achievement
13. establish measurement activities to monitor actual performance against forecast sales
14. review set targets and sales forecasts on a regular basis
15. amend targets and sales forecasts depending on outcomes of reviews
Knowledge and Understanding
You need to know and understand:
1. your organisation's sales objectives and strategy in relation to the sales activities
2. the difference between qualitative and quantitative information for forecasting purposes
3. the different types of metrics used in sales forecasting
4. the different forms of information for sales forecasting and how they are analysed
5. how to source the relevant information for sales forecasting
6. the internal and external factors that may influence or affect sales trends
7. the trends to be identified from previous sales forecasts and activities
8. the variety of qualitative and quantitative sales forecasting techniques
9. your organisation’s guidelines on the development and recording of sales forecasts
10. the range of market conditions and opportunities and how these can impact on future sales
11. how to set sales objectives and targets to make reliable forecasts of future trends
12. the typical sales targets that organisations use, such as revenue, volume, market share, call rates, turnover or growth
13. how to measure sales performance against forecast performance
14. the relevant software programmes to support the sales forecasting
15. the common causes of variances between forecast and actual sales
16. the measurement and control mechanisms applied by the organisation for their reporting of variances
17. how to review and amend targets and sales forecasts