Why Are Sales Forecasts So Difficult To Get Right


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Sales managers face lots of different challenges in their work. One, if not the, most difficult is the tricky business of sales forecasting. That’s why articles addressing the subject are amongst the most popular in our blogs. And why it features prominently in our eBook Reengineering Sales Management.

The reason sales forecasts are so nerve wracking to make, and so difficult to get right, is the traditional sales model, which most organisations use in one way or another, assumes a confrontation between buyer and seller.
The seller wants the customer to buy what she’s offering, whilst the buyer wants the seller to offer what she’s buying. Sometimes this works well for both parties, but mostly the buyer ends up disappointed, receiving something different to what she expected. The obvious problems for finance and customer service to sort out naturally follow, which is an entirely different topic.

Once bitten, twice shy, customers are less likely to get fooled again, and that makes it difficult to predict whether they’ll buy, or not, and that makes any deal impossible to forecast. They’ve been fooled already, by somebody else.

In the Information Age, businesses basing their sales strategy on the naivety of prospects had better have a lot of them, because they’re only going to close a very small percentage.

On the other hand, anybody understanding how their value add is unique, targets their proposition at prospects willing to pay for that uniqueness, and collaborates with them in a process which assures mutual satisfaction, will win a high proportion. Sales forecasts are easier to make, and get right.

When customers are more careful with their money, when competition is everywhere, when a business needs certainty in its planning, and when sales people want to win more times than they lose, the traditional sales model must be reengineered.

Instead of product and service people deciding what they want to build, instead of marketing creating aspiration which can’t be fulfilled, instead of CEOs wanting to forecast what analysts will approve of; sales managers need to figure out which unique value customers are buying, and persuade their colleagues to offer that. Following which they need to deliver, with a combination of skills and processes which brings in the sales.

And if this is all too difficult, the customers won’t care. They’ll just buy what they want from somebody else.

Republished with author's permission from original post.

Steven Reeves
Consultant, author, software entrepreneur, business development professional, aspiring saxophonist, busy publishing insight and ideas. Boomer turned Zoomer - thirty year sales professional with experience selling everything from debt collection to outsourcing and milking machines to mainframes. Blogger at Successful Sales Management. Head cook and bottle washer at Front Office Box.


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