Data and analytics is the driving force and of course the lifeblood fueling the growth of businesses today. All types of companies including startups and big businesses have realized that data analytics is important because they cannot leave the working of their businesses to chance or intuition. There are several methods of predicting sales forecast effectively, all you need to do is build comprehensive and reliable forecasting models.
As a sales manager, you know sales can fluctuate due to various trends such as seasonality and other factors making forecasting a bit challenging. Hence, it is important to use the right forecasting model when building a sales pipeline spreadsheet. A sales pipeline in Google Sheets helps to offer an interactive overview of your business sales data. From conversion rates to lead generation, from sales prospects to KPIs of your sales Reps, sales pipeline in Google Sheets is the best way to get thoughtful insights on your company’s performance.
Advantages of sales Pipeline in Google Sheets
Sales pipeline spreadsheets help you keep a close eye on sales trends, conversion rates or how your sales teams are performing to win new clients. There are endless benefits of using sales pipeline in Google Sheets:
Improves Team Performance
Since it helps you track the activities and progress of your sales team, it will give you a bird’s eye view of the progress of each deal, the number of deals completed or lost amongst others. In addition, the sales pipeline helps sales leader to set goals for individuals, know which reps are making a difference and also learn how to get the individuals not performing as well up to their game.
Better Understanding of your Customers
A sales pipeline helps you keep an overview of your customer’s behavior and the people visiting your website so you can interact with them effectively. Every customer is unique and they have their own unique interests, expectations and behaviors. This basic information about customers helps salesperson to identify what sales approach your customers respond better to. Hence, the companies are able to streamline the sales process better.
Sales Forecasting
All the data gathered in sales pipeline can be used to forecast the performance of the business. It helps create right predictions on what your business will perform in the near future based on the available information through sales, customer behavior and other metrics. This is also the best way to envisage business problems and business owners can do a lot to ensure the problems are removed to improve the company’s chance of achieving better growth and success.
Gives a Holistic Picture of your Progress
Every company has goals that they want to accomplish. Sales pipeline helps you keep an eye on the day to daily, weekly, monthly or even annual progress of the company. Thereby, gives you an idea of how close you are attaining your goals.
Forecasting in Google Sheets and Different Methods of Sales Forecasting
There are many methods of sales forecasting in Google Sheets, here are the three most commonly used quantitative forecasting methods:
Moving Averages
This method helps smooth out trends such as time series, within your data. Using this method, the sales managers can strain out micro deviations from a given time range. This will further help uncover longer-term trends that may potentially impact future outcomes.
In other words, companies can calculate the simplest form of a moving average by computing the mean of your given set of values for a specific period of time.
For instance, the moving average method helps you to calculate a five year moving data by from a given 20-year period of sales data.
Exponential Smoothing
Exponential smoothing is a popular method that helps analyze your data from specific time period and generates data without the noise, making the patterns and trends more visible. This method offers amazing outcomes by focusing on the most recent data. To exemplify, if you want to analyze 6 months of your company’s sales profit and loss, the method will put more emphasis on your previous month’s earnings than last year’s. Different exponential smoothing techniques:
- Simple or single exponential smoothing
- Holt’s linear trend or double exponential smoothing
- Triple exponential smoothing
Linear Regression
The FORECAST function in Google Sheets uses linear regression to predict future values and determine the linear relation between value series and timeline series. Regression helps to predict simple market trends, predict values, sales growth and inventory requirements. This method is more effective for casual models with simple and linear data patterns.
To Wrap Up
Sales forecasting sits at the core of every business as it helps determine how many more deals and opportunities you will need to hit the number. Also, sales managers will get an idea of how much revenue you will generate and how to take action if fall short. Choose the right methods of sales forecasting to gain access to the treasure of the information and insights of data.
