Understanding your sales forecast in Salesforce

Imagine you’re in a sailboat in the middle of the ocean and your boat has no rudder. The rest of your boat may be in tip-top shape, but without this one vital piece, you are completely powerless and have no control over where you are going.

It’s a chilling thought, and probably one that will have you checking the tiller before entering the boat next time. Yet, while you would think twice about a boat with no ability for clear direction, many companies in the business world soldier on each day with little clue of their future sales destinations and no ability to steer it.

It’s time to find the rudder.

Finding your rudder through sales forecasting

At its most basic level, growing a company is a matter of in and out. You want to bring in more money than you pay out. Sales forecasting is a vital tool in these efforts as it provides you reliable input expectations that help you manage your output expenses. Companies that employ a forecasting strategy have been shown to more aggressively grow their margins and take in higher revenue.

However, simply enrolling in a forecasting strategy is not enough, and many companies don’t forecast their sales opportunities effectively, hindering future growth. In a recent webinar, we talked about how forecasting is one of the main pillars for building a high performance sales team. You can watch the recording here.

Utilizing Salesforce to improve your forecasting

Your Salesforce system should already be functioning as your source of truth for all things related to your sales and marketing efforts. That means all the information you need to forecast your sales accurately should be here as well.

There are a couple of ways to manage forecasts in Salesforce. One is using dashboards and the other is using Salesforce’s Forecasts functionality. Before starting either, your team needs to build both a process to create a rhythm for your sales team. The processes should be ensuring your stages align with what the sales person needs to do at each stage. With Salesforce Lightning, sales people can use the Sales Path to guide their opportunities in a consistent way.

The advantage of using Salesforce’s out of the box Forecasts is it allows you to override forecasts without impacting existing opportunities. To use forecasts, you’ll need to identify the forecasting categories. The categories simply group stages into a few buckets: pipeline, closed, and omitted. Then activate Forecasts in setup. There are a couple ways to manage forecasts and some flexibility to customize them. Reach out if you have questions. Once you have the forecasts setup, simply clicking on the forecasts tab will display your rolling forecasts based on the forecast categories.

Another is using dashboard to visualize the pipeline by quarter. The advantage of this method is it can allow you to drill in the data, but lose the ability to edit the high-level pipeline numbers. The dashboard should summarize each stage by total revenue. Be sure to identify your team’s goals and highlight any opportunities that need attention.

As an end user, Salesforce’s Opportunities views should be your first destination to manage your sales pipeline, but be sure you create a pipeline that is true to your process, and don’t fill every stage if it isn’t reflective of what you do. Less is more in this case. Set tasks to reflect drive action while running new and existing accounts through this system, and you’ll be off to a great start.

That’s all for today. If you have any questions about optimizing your sales forecasting through Salesforce, we’d love to hear from you.