A sales forecast is a projection of achievable revenue. Forecasts are based on historical sales data, analysis of market surveys and trends, and salespersons' estimates. The terms sales forecast and sales budgets are sometimes used as synonyms because they both project acheivable revenue, but budgets are projected before the fiscal year begins and forecasts take place once the fiscal year is underway.
Sales representatives generally generate the forecast, while the sales manager's job is to review the forecast and make adjustments when necessary. Historically, the forecasting process has been the bane of sales reps' existence because it can be difficult for representatives to predict which deals are likely to close in a given period of time. Sales analytics and data visualization tools have helped the forcasting process become more methodical and accurate by using data to build forecasts instead of relying on instinct and subjective guesses.Content Continues Below
Sales pipeline management software can make forecasting easier and allow sales representatives to have real-time insight into where a prospective customer is in the sales process. When sales reps have easy access to data in the sales pipeline, they are more likely to generate an accurate sales forecast.