Week 9 – Poor sales forecasts make for a bad business climate.
Many reps will pad their sales forecast to make it look good to the boss. Obviously, this eventually fails. On the other side of the coin, which is equally as bad, is the sales rep that will not put a prospect into their sales forecast because they don’t want to commit and then disappoint. In their mind, if it is in the forecast then they are telling you the deal will happen.
Let your sales reps know it is called a forecast for a reason. If everything in the forecast was guaranteed to close it would be called something other than a forecast. It’s called a weather forecast because it’s the meteorologist’s best guess based on all the information they have from their scientific instruments. It’s the same thing for your sales reps. Let them know it is okay to make their best estimate of when, and for how much, the business in their pipeline will close based on what the prospect has committed to – the salespersons’ scientific instrument. This is a key point. If you move to more of a buy cycle versus a sales cycle and base your forecast on actions and commitments the prospect has taken and made, then there is less room for your sales rep to put in an arbitrary number.
It’s really up to the sales manager to make sure the forecast is accurate and realistic; regardless if the news is good or not. You need to take the time and go through each of your sales reps’ Top 10 list of prospects and/or forecast once per week and distill the real number. A forecast should not be a surprise.
Part-Time Sales Management