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How to Create a Sales Forecast (Examples & Templates)

Every business needs management tools to maximize performance and keep everything running smoothly. A sales forecast is a critical tool that businesses use to measure their progress and check everything is going to plan. Here’s a closer look at why sales forecasts are important and how to create them. We have some great templates for you, too.

What Is a Sales Forecast – And Which Factors Impact It?

Sales forecasts are data-backed predictions about the sales volume a business will experience over a specific period.

A sales forecast is very important because it provides the foundation for almost all other planning activities. Businesses will rely on accurate sales forecasting to better understand how they should plan financially and execute their game plan .

This means that sales forecasts have the potential to make or break a business.

As with anything in life, though, nothing is certain. Sales forecasts can be affected by a range of factors. This means that businesses have to prepare for any and all eventualities.

Here’s a look at some of the factors that can affect sales forecasting:

A lack of sales history

Sales forecasts are often built using historical data. Businesses analyze previous results to extrapolate and create predictions. If a business starts and lacks a good body of historical sales data, it will struggle to create an accurate sales forecast.

The type of business

Each industry has its series of unique challenges and quirks. Those factors are sometimes unpredictable and could affect a business’s revenues. The ad tech industry, for instance, is often rocked by new data privacy regulations.

Outside factors

Some businesses find that everything is moving according to plan before blindsiding by an unpredictable event they cannot control. Consumer earnings may plummet, for instance, and cause people to restrict their spending.

Inside factors

Some businesses are forced to change their pricing or payment structures. This new dynamic can often have unpredictable effects and cause a business to veer off course from what its sales forecast predicted.

Why Should You Establish Sales Forecasts?

Sales forecasting is essential for every business. Here are some of the key reasons.

Perform accurate financial planning

Sales forecasts help the CFO and financial team understand how much cash is going to be coming into a business. This gives businesses a better understanding of how they can use that capital and makes it possible to calculate what profit they can expect over a given period .

Plan sales activities

A sales forecast can help executives with sales planning. Those executives will understand how many salespeople to employ, for instance, and which quotas and targets to attribute to each of those salespeople. This means that an accurate sales forecast can help salespeople to understand and hit their objectives.

Coordinate marketing

A sales forecast will have a big impact on marketing. For instance, the sales forecast might show that sales are waning, and a bigger investment needs to be placed within marketing. It might also show that a particular product or service fails to deliver appropriate amounts of value.

Control inventory

A sales forecast gives businesses a good understanding of how much inventory they will need to purchase and retain. This is an important factor; it helps businesses balance overstocking and running out of materials. This is also true for SaaS businesses needing customer support and success.

Avoid fluctuations in price

An accurate sales forecast helps businesses maintain consistent product and service pricing. A poor sales forecast might mean a business is forced to adjust its pricing unpredictably. This tactic is often the result of panic; without the proper strategy, it jeopardizes a business’s profitability.

How to Forecast Sales – The Best Sales Forecasting Methods

Businesses around the world use a range of sales forecasting techniques. Here’s a closer look at some key methods you could use.

Opportunity Stage Forecasting

What is it?

This sales forecasting technique calculates the likelihood of deals closing throughout a pipeline.

Most businesses use a sales pipeline divided into a series of sections. The likelihood of converting a prospect increases the deeper the prospect moves into the sales process. To get the most from this technique, the team must dig into the current performance of the sales team.

After that analysis, the probabilities might look something like this:

• Sales Accepted lead : 10% probability of closing
• Sales Qualified Lead : 25% probability of closing
• Proposal sent : 40% probability of closing
• Negotiating : 60% probability of closing
• Contract sent : 90% probability of closing

Using these probabilities, you can extrapolate an opportunity stage sales forecast. You’ll want to take the deal’s potential value and multiply that by the win likelihood.

Who should use it

This is a great sales forecasting method if you have access to historical data, lots of leads in your pipeline, and you need a quick estimate. It’s important to understand that this isn’t the most accurate option, given that many random factors affect those probabilities.

Length of Sales Cycle Forecasting

This sales forecasting method finds the average length of your sales cycle. This helps you predict when your deals will likely close and reveal opportunities for your sales team to expedite the sales cycle.

This method is simple. You can find the length of your average sales cycle using the following basic formula:

Total # of days to close deals / # of closed deals

Let’s imagine, for instance, that you find the following:

• Deal 1: 28 days
• Deal 2: 15 days
• Deal 3: 50 days
• Deal 4: 38 days

We closed four deals, and it took 131 days to close them all together. This means that the average length of our sales cycle is 33 days.

Equipped with that information, we can look at our pipeline and estimate how likely we are to close deals based on how old they are. The closer a deal moves toward the average sales cycle length, the more likely it will be closed.

This is a great sales forecasting method for sales managers who want to learn more about the deals spread across their pipeline. For instance, they can use this method to differentiate between different types of groups.

Sales managers might find that the average sales cycle length is much shorter for web leads, for example, when compared to email leads.

Historical Forecasting

Historical forecasting is a very quick and simple sales forecasting technique. The process involves looking back at your previous performance within a certain timeframe and assuming that your future performance will be superior or at least equal.

This is a useful reference because it helps you to get to grips with seasonality and the outside factors that affect your sales. You might find, for instance, that the holidays are a particularly slow time for your business, and looking at historical data can help you to prepare.

With that said, historical forecasting has its issues. It assumes that buyer demand will be constant, which is no longer a given. This could mean you overestimate your sales statistics and use an accurate sales forecast.

This forecasting method is ideal for a business that needs a quick and easy way to project how much it will sell over a given period. That said, historical data should be used as a benchmark instead of the foundation of a sales forecast.

Lead Pipeline Forecasting

This time-consuming sales forecasting method involves reviewing each lead within your pipeline and determining how likely the deal will be closed. That likelihood is determined by exploring factors like the value of the opportunity, the performance of your salespeople, seasonality, and more.

This is a time-consuming method, and it often makes sense for businesses with fewer high-value leads – it wouldn’t necessarily be efficient or make much sense for a SaaS business, for instance.

The big benefit of this method is its accuracy. If you have reliable and rigid data to base your analysis on, you will find that this method can give you a deeper insight into each lead.

This method makes sense for those businesses that have a lower number of leads. Inside salespeople, for instance, will want to get a clearer picture of every lead within their pipeline. This method isn’t appropriate for SaaS businesses that operate according to volume.

Test Market Analysis Forecasting

Businesses often launch exciting new products and services. But it can be difficult to get accurate sales forecasts without historical data . Test Market Analysis forecasting is the process of developing a product or service and introducing it to a test market to forecast sales and get an approximation of future sales.

This limited rollout allows businesses to track the performance of the new offering and monitor things like consumer awareness, repeat purchase patterns, and more. This is a data-gathering exercise, and it feeds businesses with the information they need to create accurate sales forecasts.

This approach is perfect for those businesses that need to perform real-world experiments to gather useful information. A new business can use sales forecasting to use its sales data to predict where future sales can come from. This can limit the cost since it’s an effective way of having a busy sales pipeline. The limited rollout of the product is also useful from a product perspective, given that adjustments can be made according to feedback.

A big issue with this form of forecasting is that one test market may not be like the others. Your data might not reflect the wider reality, so you must make prudent choices that provide you with accurate information.

Multivariable Analysis

As the name suggests, this method calls upon analyzing a range of variables to get the clearest picture possible. This means that if the method is performed well, it can often provide the most accurate forecast.

If you use this technique, you will want to bring together factors like the average length of your sales cycle, the performance of your salespeople, historical forecasting, and more.

The success of this method hinges upon two key factors within your business: 

• the accuracy of your salespeople and their reporting
• the quality of the forecasting tools that you use.

Both of these factors must be in place to make sure this forecasting method has the best chance of success.

Multivariable forecasting is most appropriate for larger and well-organized businesses, as it uses the data and tools necessary to blend various forecasting methods into one. This could be it if you need the most accurate forecast method possible.

Intuitive Forecasting

Your salespeople are on the front; their experience is very valuable. They often have a good idea of how likely they are to close a particular deal and can use educated guesses to assess the situation.

Experienced salespeople can take emotion out of the equation and rely on their experience and knowledge to make accurate predictions. Some businesses decide to incorporate those gut instincts into the way that they forecast a particular sale.

Some businesses, for instance, will add a score to the conversion probability of their various prospects according to the gut feeling of their salespeople.

This intuitive forecasting method is particularly useful for businesses that lack historical data. Without the quantifiable data to provide the basis for your sales forecasting, you might have to turn to more qualitative assessments from your salespeople.

The downside of this sales forecasting method is clear, though. These assessments are highly subjective, and you might find that your salespeople are often more optimistic in their projections. This means those projections should be taken with a pinch of salt, but they are better than nothing.

Sales Forecast Examples

We know the theory, but how about the practice? In these awesome examples, let’s take a closer look at what those sales forecast methods look like.

Standard Business Plan Financials

This example from Tim Berry (chairman and founder of Palo Alto Software) looks at what a startup sales forecast might look like .

Tim sets the scene and describes Magda’s situation – she wants to open a small café in an office park.

He goes on to show how Magda would establish a base case, estimate her monthly capacity, and what type of sales she could expect. To wrap up, she goes through her month-by-month estimates for her first year and estimates her direct cost.

This is a great exercise and unmissable reading for new entrepreneurs dreaming up a new venture.

Sales Forecast Guide by Toptal Research

This simple sales forecasting guide from Toptal Research also includes a simple example that forms the basis of the guide. These simple visuals and data will give you a good idea of how you can put your sales forecasting efforts together and what it will look like.

This example also shows that you can attractively forecast sales and inform the sales teams. Sales forecasting doesn’t have to be boring columns of data, but you can bring your sales forecast to life with colorful visuals.

Detailed Sales Forecast by Microsoft

This detailed sales forecast template from Microsoft makes it simple for you to estimate your monthly sales projections.

The formula comes with pre-built formulas and worksheet features that result in an attractive and clear template. The template also relies on a weighted sales forecasting method based on the probability of closing each opportunity.

Even if you do not use this exact template, it’s a great file to use. It can give you a great idea of the information you need to include and how it might come together in a spreadsheet format.

Sales Forecast Templates

Looking for your own sales forecast templates to get a running start? Here’s a look at some of the most practical and useful templates.

Sales Forecast Template for Excel by Vertex42

This free sales forecast template helps you keep a handle on key information like unit sales, growth rate, profit margins, and gross profit.

The template is already set up to help you compare and analyze a range of products and services on a monthly basis. The chart also includes a range of sample charts that can be used to effectively and accurately communicate the contents of your sales forecast.

The same worksheet can be used to create monthly and yearly forecasts. You can play with the template to find your desired view and information. 

Sales Forecast Template by Freshworks

This simple forecasting template helps you to put together an effective sales forecast. This finished product can then be used to grow your revenues and hit your quotas.

This template is particularly effective for small businesses and startups that need to project sales and prioritize deals at the early stages of their business. Freshworks also explains that the template can help businesses achieve a higher rate of on-time delivery and accurate hiring projections.

The free sales forecast template is very intuitive to use. Again, it’s great to flick through the spreadsheet to understand what you need in a sales forecast and how it can be put together.

Free Sales Forecast Template by Fit Small Business

This sales forecast template is perfect if your CRM doesn’t currently offer built-in sales forecasting. This template can help you create a forecast from scratch that is adjusted to your own particular needs much quicker.

The template is available in various formats, including PDF, Excel, and Google Sheets. This is great news if you create your small business on your own terms and have limited software access .

Again, this template is clear and simple to use. All of the fields are explained within the spreadsheet – you don’t have to worry about going elsewhere to find definitions.

Sales Forecasting Tools

Looking for sales forecasting tools to take your activities to the next level? Here’s a look at some of the standout options.

Pipedrive is a sales CRM that is designed for salespeople by salespeople. It is a robust CRM that includes all of the features a sales team needs to achieve sales success and grow their business.

The tool also includes a forecasting tool. This tool acts as a personal sales manager that helps salespeople to choose the right deals and activities at the right time. This helps salespeople to become better closers.

By all accounts, this function is very useful for salespeople and managers alike. The forecasting tool can also be customized to match the specific needs of salespeople.

Smart Demand Planner

Smart Demand Planner is a consensus demand planning and statistical forecasting solution that understands how accurate critical forecasts are to a business.

The tool was built on the premise that forecasts are often inaccurate and can cause various issues. Moreover, the traditional sales forecast often resides within a complex spreadsheet that is difficult to use, share, and scale.

The tool aims to fix those issues by aligning strategic business forecasting at all levels of your hierarchy. Smart Demand Planner offers a statistically sound objective foundation for your sales activities.

amoCRM is an easy and smart sales solution that focuses on the world of messenger-based sales. The platform understands the popularity and potential of messenger apps, so it offers a whole new way of using the channel to create valuable relationships.

The tool also includes visual, real-time reports that give salespeople and managers powerful insights. These analytics can be used to set targets and also forecast future sales. What’s more, they can measure performance and identify target areas.

The visual look and feel of the platform make this a very intuitive option. It can drive value through accurate forecasting in businesses where messenger-based selling is critical.

As we have seen, forecasts are critical to the success of your business. They can be cost-effective for a new business, keep sales teams and reps informed, and more. However, every business also needs the leads to make those forecasts a reality. Learn more about UpLead today and how our platform can help you to find, connect, and engage with qualified prospects.

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10 Free Sales Forecast Templates in Excel and ClickUp

Praburam Srinivasan

Growth Marketing Manager

February 15, 2024

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An effective sales forecast ensures the organization (or the sales team) hits the targets by setting realistic goals. A sales forecast template makes it easy for a busy manager to forecast sales and revenue. 

Let’s take two scenarios: 

Sales Manager A asks the VP of Sales to hire more people to crush their 2025 goals. The manager has a rough idea of how many sales reps they need. 

On the other hand, Sales Manager B has a solid plan of how many reps they need and what the sales projections and future revenue look like based on market trends, customer data, and the revised headcount. 

If you were the VP of Sales, whose sales forecasting would you opt for?

Manager B, naturally. Why? Because Manager B provides a solid sales forecast to back what they’re asking for.

This article covers the sales forecast templates in Excel and ClickUp to improve your business forecasting accuracy and decision-making. 

What is a Sales Forecast Template?

What makes a good sales forecast template, 1. clickup sales forecast template, 2. clickup sales report template, 3. clickup sales crm template, 4. clickup sales page template, 5. clickup sales pipeline template, 6. clickup sales kpi template, 7. excel sales forecast template by salesflare , 8. excel sales forecast template by excel skills, 9. sheets retail businesses forecasting template by close, 10. excel sales forecast template by gong.

A sales forecast template is a customizable form that gives you expected sales and revenue over a specific period.

Your sales forecast template can predict the increase in the average order value for an existing product or the number of units sold, the growth rate for a specific time (weekly/monthly/quarterly), and the number of new customers you’re likely to add. 

Sale forecast templates are helpful during the planning stage as they help businesses allocate resources, estimate costs, and assess if the business actions align with the short and long-term organizational goals. 

Business owners rely on the sales forecasting template to develop budgets for hiring and plan the production cycles. Sales teams use them for territory and quota planning and to drive their sales strategy with channel and partner sales.

For the sales project template to be functional, it should be:

• Clear and simple: The template should be easy to use along with essential sections such as financial projections, revenue targets, and sales quotas
• Customizable: A good sales projection template is customizable to fit your organization’s decision-making process and adapt to your sales cycle
• Collaborative: The free sales forecasting template should allow input from stakeholders, the sales team , and leadership to promote cross-departmental collaboration
• Visually engaging: You should be able to add charts, tables, whiteboards, and diagrams to understand future sales revenue targets at a glance
• Workflow automation: For an accurate sales forecast, you need automation to convert raw numbers into insights and assign follow-up tasks rather than doing it manually
• Integrations: Choose a sales forecast template that integrates with Google Sheets, strategic planning templates , customer relationship management (CRM) software, and tools your sales team uses
• Artificial intelligence: Does the sales forecasting template have built-in AI tools to complete the template or speed up the process?

10 Sales Forecast Templates to Use in 2024

ClickUp’s Sales Forecast Template helps you visualize the pipeline and current sales process, set future goals, and collaborate with your team in one place.

Here’s how to use this template effectively:

• Gather historical data of order volumes, revenue by accounts, profit margin, or deal value. Create a spreadsheet of your company data and add relevant data using Table View in ClickUp to project growth 
• Analyze the data and look for trends and patterns. There are 17 custom attributes such as product name, month, shipping cost for average sale, lead conversion rates for multiple products, and forecast amount to help you visualize the trends easily
• Set realistic goals for sales growth considering consumer feedback, historical sales data, and upcoming market opportunities. Create tasks to track your progress toward the goals
• Project future revenue based on the goals you’ve set. Assess different scenarios, such as high-growth and low-growth situations, and use Gantt charts in Clickup to visualize your projections
• Monitor and course-correct the forecasts as you progress toward your goals 

One of the most widely used free sales forecasting templates, it ensures you include all viable deals when making future growth projections. 

Even seasonal businesses use this template as their go-to tool to make accurate sales forecasts.

Presenting an efficient sales report helps you stay organized and builds trust with the leadership team. Whatever sales forecasting methods you use, this sales report template gives you an overview of your sales efforts by breaking down your annual, quarterly, and monthly sales. 

Compare historical performance for multiple years by exporting data from sales plan templates . 

Clickup Sales Report Template is your go-to guide to stay organized and monitor sales performance. Understand what has worked in the past and gain insights into how you’re doing and where you’re headed.

Slice and dice the information using key data points such as geography, key account managers, sales achievements, and sales goals. Set up custom views to generate monthly, quarterly, and annual growth rates and have this information at your fingertips.

Use this template to highlight dependency warnings, track capabilities, and improve sales performance tracking. 

ClickUp’s beginner-friendly forecast template lets you track your actual sales against projections and break them up by service type or how many units are sold if you have multiple products. Track the impact of seasonality in retail stores or compare how different regions are performing against each other and export other relevant information from your sales report template . 

Use this data in your after-action report data templates to evaluate the performance in tangible terms, such as technical correction or lessons learned. 

Managing and tracking leads is exhausting, and sales reps detest it.  Any sales rep would rather spend time building relationships and closing deals than making manual entries.

ClickUp’s Sales CRM Template serves as a backbone to your team. Whether you are a small business or a large enterprise, having a robust CRM is essential to stay ahead of the competition and focus on the factors that matter most.

With a robust no-code database and real-time analytics, you can trust ClickUp’s Sales CRM Template to:

• Help your sales team stay organized 
• Gain visibility into customer interactions and buying cycles 
• Identify prospects, customers, in-active users, and uncover insights about closed deals 
• Gain clarity into customer communications 
• Store and access customer data from a central location 
• Increase productivity by eliminating manual tasks and automating processes 

Use toggles and dropdowns to move lead status such as Onboarding, Active, and Payment Pending to monitor the progress on every sale. Set key customer demographics and interests to personalize your campaigns and automate follow-up emails.

Build a transparent sales forecasting process wherein everyone can see the shared sales data, forecast revenue, and other critical data points. 

Use quarterly business review (QBR) templates to align organizational goals, hold everyone accountable, and drive continuous improvement. 

ClickUp’s Sales Page Template lets you create engaging and visually appealing sales pages to take your product to more customers.

This template gives you a starting point to create the best possible page with capabilities such as: 

• Generate more leads and improve conversions
• Communicate product offerings with customers
• Organize and track sales key performance indicators (KPIs) such as forecasted sales easily
• Encourage website visitors to take the next action (sign-ups or become paying customers)
• Highlight your product features and benefits with multiple media formats such as text, images, or videos

Although not a forecast template per se, the Sales Page Template lets you create sales pages without dependency on your tech teams.

Tips to best use this template:

• Define your target audience and understand who you’re trying to reach to create a page that directly speaks to their needs. Use ClickUp Docs to note all the characteristics of your potential customers and your sales goals  
• Use tasks to list the key features and benefits of your product or multiple products and make this the basis of your sales page
• Write a compelling copy for your sales page while focusing on the benefits and addressing your target audience’s pain points in Docs
• Design an engaging sales page that keeps your visitors engaged using ClickUp Whiteboard
• Once the page is live, A/B test different versions of the page to see the best-performing version and optimize it further. The Board view lets you track sales page versions and their performance
• Lastly, collect user feedback to improve the landing page and your product. The key to achieving projected revenue is keeping an open mind and the ability to make changes based on user input  

As a sales leader, the last thing you want to do is follow up with your team members to know the total sales vs. the sales projections vs. sales goals and the growth rate. You should have all these details with you 24/7. 

A structured and efficient sales pipeline management process takes you from stressful month-end to more focused and strategy-driven conversations with your sales team.

Unless you have a structured sales pipeline, the leaders have limited visibility on how close or far the sales reps are in meeting their quotas.  

Clickup’s Sales Pipeline Template gives you an ultimate toolkit to monitor and optimize every stage of your sales process. Use this forecast template to get a bird’s eye view of the pipeline and sort your actions based on urgency, value, and potential.

Consider adding the daily sales forecast and monthly sales projection template to your workflow to visualize the entire sales funnel in a single view. 

KPIs track critical sales metrics to improve sales performance, identify opportunities and prospects, and increase revenue generation. While they’re an excellent resource to measure the success of your sales strategy, with so many metrics, deciding which ones to track becomes overwhelming.

ClickUp Sales KPI Template helps you set measurable goals and track them across the sales funnel. The free sales forecasting template offers visibility into a team’s efforts and assesses if they maximize organizational goals.

This template provides an easy solution for sales leaders and their teams to understand the metrics they drive, provide clarity and transparency on performance, and take corrective actions.

Visualize relevant KPIs using custom fields such as Upsell Attempts, Value of Quotes, and Repeat Sales Revenue and send regular reports to your C-suite. 

If a small business owner needs a template for forecasting sales or keeping track of expected revenue, Salesflare’s Excel Sales Forecast Template is a good starting point. 

Or, if you’re facing scalability challenges using an Excel sheet as your budget forecast template, use this template to forecast your revenue, track historical sales data, and improve your sales process.

Create your sales funnel, record the probability of closing deals, set targets for your team, and assign them tasks. Use pre-built charts to fine-tune your forecast for quarterly, annually, or for any specific time.

Set sales OKRs for your team, closure probabilities, and a custom # of days after which you would like to follow up. This tells you how your sales reps are doing and how their conversions look and equips you to take relevant action.

Salesflare lets you import your Excel and Google Sheets templates into its CRM, making extra space for you to focus on building relationships.

Excel Skills Sales Forecast Template is effective when you have shorter sales cycles and don’t need pipeline-level lead tracking. This template compiles monthly sales forecasts for three years.

Compared to other sales forecast templates by ClickUp, the caveat is you must manually enter data such as monthly sales volumes, selling prices, and gross profit percentages for each product category. All the other calculations are automatically updated.

This sales projections template has pre-built functions showing you total sales, cost of sales, and monthly gross profit. The template includes five product categories, but you can add additional categories by simply inserting the appropriate number of rows in each sales forecast section.

While the other sales forecast templates in this list are industry-agonistic, the Retail Business Forecasting Template by Close is for retail businesses.

Traditionally, retail sales forecasts happen over spreadsheets. This beginner-friendly retail sales forecast template allows retail shops to compile monthly sales forecasts, allocate budgets, spot trends, and catch potential pitfalls early.

The different ways to use this Excel-native template are:

• Track your leads and meetings and get a complete view of your sales pipeline
• Perform monthly and yearly forecasting to plan your sales projections 
• Customize the free sales forecasting template with adjustable funnel metrics
• Interpret data using visual graphs 

Do you forecast in the dark? Are your committed deals backing out? Need help with low quota issues?

If you answer yes to any or all of these issues, Gong’s Excel Sales Forecast Template is for you. Designed in Excel, this simple and free sales forecast template identifies gaps in your pipeline and ensures your team hits its targets.

Within the pre-built template, you must enter your team-specific numbers, and the premade formulas make your forecasts in minutes.

This sales forecasting template covers you from weekly sales forecast, pipeline coverage, or total pipeline coverage.

Predict and Optimize Your Future Revenue with the Right Sales Forecasting Template

Manual forecasting is time-consuming and erroneous. You’re missing out on all the actionable insights that could help your sales managers meet and exceed their sales goals.

A suitable sales forecast template will make all the difference—you don’t have to create forecasting frameworks from scratch every time.

Modern sales teams and business owners love ClickUp’s forecast templates as they’re customizable, integrate with third-party tools, and combine project management with forecasting.

  Sign up on ClickUp to get started for free.

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• Sales forecasting: How to create a sale ...

Sales forecasting: How to create a sales forecast template (with examples)

A strong sales team is the key to success for most companies. They say a good salesperson can sell sand at the beach, but whether you’re selling products in the Caribbean or Antarctica, it all comes down to strategy. When you’re unsure if your current strategy is working, a sales forecast can help.

What is a sales forecast?

A sales forecast predicts future sales revenue using past business data. Your sales forecast can predict a number of different things, including the number of new sales for an existing product, the new customers you’ll gain, or the memberships you’ll sell in a given time period. These forecasts are then used during project planning to determine how much you should allocate towards new products and services. 

Why is sales forecasting important?

Sales forecasting helps you keep a finger on your business’s pulse. It sets the ground rules for a variety of business operations, including your sales strategy and project planning. Once you calculate your sales projections, you can use the results to assess your business health, predict cash flow, and adjust your plans accordingly.

An effective sales forecasting plan:

Predicts demand: When you have an idea of how many units you may sell, you can get a head start on production.

Helps you make smart investments: If you have future goals of expanding your business with new locations or products, knowing when you’ll have the income to do so is important. 

Contributes to goal setting: Your sales forecast can help you set goals outside of investments as well, like outshining competitors or hiring new team members.

Guides spending: Your sales forecast may be the wake-up call you need to set a budget and use cost control to reduce expenses.

Improves the sales process: You can change your current sales process based on the sales projections you’re unhappy with.

Highlights financial problems: Your sales forecast template will open your eyes to problem areas you may not have noticed otherwise. 

Helps with resource management: Do you have the resources you need to fill orders if it’s an accurate sales forecast? Your sales forecast can guide how you allocate and manage resources to hit targets.

When you have an accurate prediction of your future sales, you can use your projections to adjust your current sales process. Leveraging inventory management software can help you implement these adjustments more effectively by providing up-to-date data on stock levels and supply chain performance.

Sales forecasting methods

Sales forecasting is an important part of strategic business planning because it enables sales managers and teams to predict future sales and make informed decisions. But why are there multiple sales forecasting methods? Simply put, businesses vary in size, industry, and market dynamics, so no single methodology suits all.

Choosing the right sales forecasting method is more of an art than a science. It involves:

Analyzing your business size and industry

Assessing the available data and tools

Understanding your sales cycle's complexity

A few telltale signs that you've picked the correct approach include:

Improved accuracy in sales target predictions

Enhanced understanding of market trends

Better alignment with your business goals

Opportunity stage forecasting

Opportunity stage forecasting is a dynamic approach ideal for businesses using CRM systems like Salesforce. It assesses the likelihood of sales closing based on the stages of the sales pipeline. This method is particularly beneficial for sales organizations with a clearly defined sales process.

For example, a software company might use this method to forecast sales by examining the number of prospects in each stage of their funnel, from initial contact to final negotiation.

Pipeline forecasting method

The pipeline forecasting method is similar to opportunity stage forecasting but focuses more on the volume and quality of leads at each pipeline stage. It's particularly useful for businesses that rely heavily on sales forecasting tools and dashboards for decision-making.

A real estate agency could use it by examining the number of properties listed, the stage of negotiations, and the number of closings forecasted in the pipeline.

Length of sales cycle forecasting

Small businesses often prefer the length of sales cycle forecasting. It's straightforward and involves analyzing the duration of past sales cycles to predict future ones. This method is effective for businesses with consistent sales cycle lengths.

A furniture manufacturer, for instance, might use this method by analyzing the average time taken from initial customer contact to closing a sale in the past year.

Intuitive forecasting

Intuitive forecasting relies on the expertise and intuition of sales managers and their teams. It's less about spreadsheets and more about market research and understanding customer behavior. This method is often used with other, more data-driven approaches.

A boutique fashion store, for example, might use this method, relying on the owner's deep understanding of fashion trends and customer preferences.

Historical forecasting

Historical forecasting uses past performance data to predict future sales. This method is advantageous for businesses with ample historical sales data. It's less effective for new markets or rapidly changing industries.

An established book retailer could use historical data from previous years, considering seasonal trends and past marketing campaigns, to forecast next quarter's sales.

Multivariable analysis forecasting

Multivariable analysis forecasting is a more sophisticated method that's ideal for larger sales organizations. It analyzes factors like market trends, economic conditions, and marketing efforts to provide a holistic view of potential sales outcomes.

An automotive company, for example, could analyze factors like economic conditions, competitor activity, and past sales data to forecast future car sales.

How to calculate sales forecast

Sales forecasts determine how much you expect to do in sales for a given time frame. For example, let’s say you expect to sell 100 units in Q1 of fiscal year 2024. To calculate sales forecasts, you’ll use past data to predict future trends. 

When you’re first creating a forecast, it’s important to establish benchmarks that determine how much you normally sell of any given product to how many people. Compare historical sales data against sales quotas—i.e., how much you sold vs. how much you expected to sell. This type of analysis can help you set a baseline for what you expect to achieve every week, month, quarter, and so on.

For many companies, this means establishing a formula. The exact inputs will vary based on your products or services, but generally, you can use the following:

Sales forecast = Number of products you expect to sell x The value of each product

For example, if you sell SaaS products, your sales forecast might look something like this: 

SaaS FY24 Sales forecast = Number of expected subscribers x Subscription price

Ultimately, the sales forecasting process is a guess—but it’s an educated one. You’ll use the information you already have to create a data-driven forecasting model. How accurate your forecast is depends on your sales team. The sales team uses facts such as their prospects, current market conditions, and their sales pipeline. But they will also use their experience in the field to decide on final numbers for what they think will sell. Because of this, sales leaders are more likely to have better forecasting accuracy than new members of the sales team.

Sales forecast vs. sales goal

Your sales forecast is based on historical data and current market conditions. While you always hope your sales goals are attainable—and you can use data to estimate what your team is capable of—your goals might not line up directly with your forecast. This can be for a number of reasons, including wanting to create stretch goals that push your sales team beyond what they’ve done in the past or big, pie-in-the-sky goals that boost investor confidence.

How to create a sales forecast

There are different sales forecasting methods, and some are simpler than others. With the steps below, you’ll have a basic understanding of how to create a sales forecast template that you can customize to the method of your choice. 

1. Track your business data

Without details from your past sales, you won’t have anything to base your predictions on. If you don’t have past sales data, you can begin tracking sales now to create a sales forecast in the future. The data you’ll need to track includes:

Number of units sold per month

Revenue of each product by month

Number of units returned or canceled (so you can get an accurate sales calculation)

Other items you can track to make your predictions more accurate include:

Growth percentage

Number of sales representatives

Average sales cycle length

There are different ways to use these data points when forecasting sales. If you want to calculate your sales run rate, which is your projected revenue for the next year, use your revenue from the past month and multiply it by 12. Then, adjust this number based on other relevant data points, like seasonality.

Tip: The best way to track historical data is to use customer relationship management (CRM) software. When you have a CRM strategy in place, you can easily pull data into your sales forecast template and make quick projections.

2. Set your metrics

Before you perform the calculations in your sales forecast template, you need to decide what you’re measuring. The basic questions you should ask are:

What is the product or service you’re selling and forecasting for? Answering this question helps you decide what exactly you’re evaluating. For example, you can investigate future trends for a long-standing product to decide whether it’s worth continuing, or you can predict future sales for a new product. 

How far in the future do you want to make projections? You can decide to make projections for as little as six months or as much as five years in the future. The complexity of your sales forecast is up to you.

How much will you sell each product for, and how do you measure your products? Set your product’s metrics, whether they be units, hours, memberships, or something else. That way, you can calculate revenue on a price-per-unit basis.

How long is your sales cycle? Your sales cycle—also called a sales funnel—is how long it takes for you to make the average sale from beginning to end. Sales cycles are often monthly, quarterly, or yearly. Depending on the product you’re selling, your sales cycle may be unique. Steps in the sales cycle typically include:

Lead generation

Lead qualification

Initial contact

Making an offer

Negotiation

Closing the deal

Tip: You can still project customer growth versus revenue even if your company is in its early phases. If you don’t have enough historical data to use for your sales forecast template, you can use data from a company similar to yours in the market. 

3. Choose a forecasting method

While there are many forecasting methods to choose from, we’ll concentrate on two straightforward approaches to provide a clear understanding of how sales forecasting can be implemented efficiently. The top-down method starts with the total size of the market and works down, while the bottom-up method starts with your business and expands out.

Top-down method: To use the top-down method, start with the total size of the market—or total addressable market (TAM). Then, estimate how much of the market you think your business can capture. For example, if you’re in a large, oversaturated market, you may only capture 3% of the TAM. If the total addressable market is $1 billion, your projected annual sales would be $30 million. 

Bottom-up method: With the bottom-up method, you’ll estimate the total units your company will sell in a sales cycle, then multiply that number by your average cost per unit. You can expand out by adding other variables, like the number of sales reps, department expenses, or website views. The bottom-up forecasting method uses company data to project more specific results. 

You’ll need to choose one method to fill in your sales forecast template, but you can also try both methods to compare results.

Tip: The best forecasting method for you may depend on what type of business you’re running. If your company experiences little fluctuation in revenue, then the top-down forecasting method should work well. The top-down model can also work for new businesses that have little business data to work with. Bottom-up forecasting may be better for seasonal businesses or startups looking to make future budget and staffing decisions.

4. Calculate your sales forecast

You’ve already learned a basic way to calculate revenue using the top-down method. Below, you’ll see another way to estimate your projected sales revenue on an annual scale.

Divide your sales revenue for the year so far by the number of months so far to calculate your average monthly sales rate.

Multiply your average monthly sales rate by the number of months left in the year to calculate your projected sales revenue for the rest of the year.

Add your total sales revenue so far to your projected sales revenue for the rest of the year to calculate your annual sales forecast.

A more generalized way to estimate your future sales revenue for the year is to multiply your total sales revenue from the previous year.

Example: Let’s say your company sells a software application for $300 per unit and you sold 500 units from January to March. Your sales revenue so far is $150,000 ($300 per unit x 500 units sold). You’re three months into the calendar year, so your average monthly sales rate is $50,000 ($150,000 / 3 months). That means your projected sales revenue for the rest of the year is $450,000 ($50,000 x 9 months).

5. Adjust for external factors

A sales forecast predicts future revenue by making assumptions about your growth rate based on past success. But your past success is only one component of your growth rate. There are external factors outside of your control that can affect sales growth—and you should consider them if you want to make accurate projections. 

Some external factors you can adjust your calculations around include:

Inflation rate: Inflation is how much prices increase over a specific time period, and it usually fluctuates based on a country’s overall economic state. You can take your annual sales forecast and factor in inflation rate to ensure you’re not projecting a higher or lower number of sales than the economy will permit.

The competition: Is your market becoming more competitive as time goes on? For example, are you selling software during a tech boom? If so, assess whether your market share will shrink because of rising competition in the coming year(s).

Market changes: The market can shift as people change their behavior. Your audience may spend an average of six hours per day on their phones in one year. In the next year, mental health awareness may cause phone usage to drop. These changes are hard to predict, so you must stay on top of market news.

Industry changes: Industry changes happen when new products and technologies come on the market and make other products obsolete. One instance of this is the invention of AI technology.

Legislation: Although not as common, changes in legislation can affect the way companies sell their products. For example, vaping was a multi-million dollar industry until laws banned the sale of vape products to people under the age of 21. 

Seasonality: Many industries experience seasonality based on how human behavior and human needs change with the seasons. For example, people spend more time inside during the winter, so they may be on their computers more. Retail stores may also experience a jump in sales around Christmas time.

Tip: You can create a comprehensive sales plan to set goals for team members. Aside from revenue targets and training milestones, consider assigning each of these external factors to your team members so they can keep track of essential information. That way, you’ll have your bases covered on anything that may affect future sales growth. 

Sales forecast template

Below you’ll see an example of a software company’s six-month sales forecast template for two products. Product one is a software application, and product two is a software accessory. 

In this sales forecast template, the company used past sales data to fill in each month. They projected their sales would increase by 10% each month because of a 5% increase in inflation and because they gained 5% more of the market. They kept their price per unit the same as the previous year.

Putting both products in the same chart can help the company see that their lower-cost product—the software accessory—brings in more revenue than their higher-cost product. The company can then use this insight to create more low-cost products in the future.

Sales forecast examples

Sales forecasting is not a one-size-fits-all process. It varies significantly across industries and business sizes. Understanding this through practical examples can help businesses identify the most suitable forecasting method for their unique needs.

Sales forecasting example 1: E-commerce

In the e-commerce sector, where trends can shift rapidly, intuitive forecasting is often useful for making quick, informed decisions.

Scenario: An e-commerce retailer specializing in fashion accessories is planning for the upcoming festive season.

Trend analysis phase: The team spends the first week analyzing customer feedback and current fashion trends on social media, using intuitive forecasting to predict which products will be popular.

Inventory planning phase: Based on these insights, the next three weeks are dedicated to selecting and ordering inventory, focusing on products predicted to be in high demand.

Sales monitoring and adjustment: As the holiday season approaches, the team closely monitors early sales data, ready to adjust their inventory and marketing strategies based on real-time sales performance.

This approach allows the e-commerce retailer to stay agile , adapting quickly to market trends and customer preferences.

Sales forecasting example 2: Software development

For a software development company, especially one working with B2B clients, opportunity stage forecasting can help predict sales and manage the sales pipeline effectively.

Scenario: A software development company is launching a new project management tool.

Lead generation and qualification phase: In the initial month, the sales team focuses on generating leads, qualifying them, and categorizing potential clients based on their progress through the sales pipeline.

Proposal and negotiation phase: For the next two months, the team works on creating tailored proposals for high-potential leads and enters negotiation stages, using opportunity stage forecasting to predict the likelihood of deal closures.

Closure and review: In the final phase, the team aims to close deals, review the accuracy of their initial forecasts, and refine their approach based on the outcomes.

Opportunity stage forecasting enables the software company to efficiently manage its sales pipeline , focusing resources on the most promising leads and improving their chances of successful deal closures.

Pair your sales forecast with a strong sales process

A sales forecast is only one part of the larger sales picture. As your team members acquire leads and close deals, you can track them through the sales pipeline. A solid sales plan is the foundation of future success.  

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9 Free Sales Forecast Templates to Super-Charge Sales Growth in 2024

Sales forecasting templates might not sound all that exciting. Fair enough. After all, who wants to create more reports—on top of all your other responsibilities?

If you're feeling a little skeptical, take a walk with me and imagine this scenario involving two different sales managers :

Which of these sales managers is more likely to get the budget they want?

No brainer. It's Sales Manager 2 every day of the week.

What's the difference between their pitches? A solid sales forecast to back up the substantial investment they're asking the VP to make.

Sales forecasts can be exciting—they give you the superpower to see what's coming down the pipeline. More importantly, they're easy to create using the right sales forecasting templates.

In this guide, we'll give you a step-by-step method to create a sales forecast and access to several free sales forecast templates (in both Microsoft Excel & Google Sheets format).

But first, let’s quickly touch on why sales forecasts are key to growing your sales team—and your business.

Why are Sales Forecasts Crucial for Sales Teams?

Sales forecasting provides a window into your business's future. Depending on the template, it can help you:

• Predict sales figures for the next quarter: Much like projecting total contract value growth, sales forecasting provides a roadmap for anticipated revenue, enabling you to plan and allocate resources accordingly.
• Make more accurate cash flow projections
• Predict expenses
• See where to invest marketing dollars
• Better allocate hiring budgets
• Spot emerging trends early on
• Diagnosis of potential issues in your sales flow early

Lastly, it is a powerful motivation tool for your sales team—especially if you have a longer sales cycle. It allows you to paint a clear picture showing how the work your team is doing today will pay off.

9 Best Sales Forecast Templates (Free Google Sheets + Excel Templates)

Not every sales team needs a super complex sales forecasting model. For instance, small businesses only want (and need) to track a few important metrics. On the other hand, eCommerce companies must track multiple products, which is challenging without a template.

So, we've sorted through all the free sales forecast templates we could find (in Excel + Google Sheets format) and even created one of our own. Choose the best template for your company, sales team, and industry.

1. Best General Forecast Template (without a CRM)

This sales forecasting template from Close provides a simple way to track and forecast two years of sales. The first tab allows for adjusting funnel metrics depending on your sales cycle, average deal size, lead growth, and number of leads.

The second tab forecasts sales by month based on meetings booked, new opportunities created, and leads closed/won. A chart at the bottom displays expected growth.

The only thing better than this is having sales forecasting built right into your CRM ( like with Close ), which enables you to have powerful integrations that enrich your forecasting accuracy and pipeline health over time.

GET THE FREE TEMPLATE HERE

2. Best Forecast Template for a Lead-Driven Sales Process

This template is ideal for companies that track their lead generation efforts and monitor their monthly sales forecast. You’ll see it breaks the year into quarters and tracks leads in all stages of the sales funnel .

The best part? This is a Google Sheets template (which can be accessed via Google apps and can also be downloaded for use in Microsoft Excel).

This template tracks the deal value and uses a weighted forecast model. It can also predict the probability of closing, which is a helpful metric for B2B companies. You can download it right here .

3. Best Free Forecasting Template for Multiple Product Businesses

Does your company sell multiple products or services? This sales projection template could be a great choice for a business with more complex offerings. It tracks the number of units sold for each product line over 12 months on a single spreadsheet to streamline your forecasting accuracy.

It also carries over sales history from three previous years, making it easy to compare sales by unit, month, or year. You can download it right here in Google Sheets or Microsoft Excel format. Just make a copy and start editing the sheet.

4. Best Forecasting Template for Retail Businesses

This template is ideal for retail stores that want to forecast sales, track gross sales, and mark up percentage and profit margin for each item to generate more new business. The yellow cells allow you to input your own data, and the spreadsheet uses smart Excel automation formulas to calculate forecasts.

While it doesn't display the previous year's data in this view, you could easily create a pivot table in Excel or Google Sheets to pull data from several years. That way, you can compare average sales, total sales, and other sales KPIs that matter to your leadership. You can pick this one up right here .

5. Best for Long-Term Future Sales Analysis (36 Months of Historical Data)

This is one of the most colorful templates on the list, but that's not why we included it. This template is ideal for companies that want to monitor long-term data closely.

In addition to 12 months of full historical sales data, you'll also see detailed insights and data for the past five years, including overall revenue for each type of item. This is a good option if you want to focus your sales analysis on the long and short term. You can grab this one right here .

6. Best Sales Forecasting Model for Scenario Planning (New Product Launches)

Forecasting sales for a new product launch can be a challenge—which is why many companies do a soft launch without high expectations.

After a soft launch, use this forecasting template to track initial sales data and project your next five years of sales. Head over here to download this one .

7. Best Free Template for Multiple Products at Different Growth Rates

Looking to track product sales that grow at different rates? This spreadsheet tracks growth and forecasts revenue for 12 months—even if the products or services grow at different rates. This is a great fit for businesses with legacy products that regularly launch new products.

This forecasting chart also includes five years of historical data so you can see overall sales growth at a glance. Pick this template up right here .

8. Best for Short-Term Forecasts

Want to plan your inventory or marketing campaigns for just the next few weeks? This 3-month forecast template can help.

Customize the start date, then enter your number of units and price per unit to get projections. It’s simple and effective. Download this template right here .

9. Best for Daily Forecasts

Now, let’s shorten the projections even more—to a daily window. This one is primarily useful for businesses in the retail, restaurant, and hospitality industries.

With this template, predict your sales on a daily or weekly time frame. This granular vision can help you optimize day-to-day sales. Plus, you can rely on historical sales data and add weekly notes.

Grab this forecast template here .

How to Choose the Right Sales Forecast Template (& Forecasting Methods for Your Business)

The right forecasting template provides access to the sales KPIs that matter most to your sales team. But not all businesses are the same.

Retail businesses may need to track hundreds of products and dozens of different suppliers, while a SaaS company might only offer three pricing plans—but have a really long sales cycle.

You need to find the right template for your business needs. Otherwise, you'll be left floundering in a sea of useless data.

Here's how to select the right sales forecast template for your organization.

Get Clear on Your Sales Goals & Set Realistic Sales Revenue Targets

Different sales goals and revenue targets rely on different data. For example, if you want to predict sales over the next two years, you'll want a forecast template that covers a longer time period.

Goals can also impact which template will work best for your team.

For example, suppose an eCommerce company wants to increase monthly sales by 10 percent and boost customer lifetime value . In this case, they'll need a different template than a small business looking to increase sales from a specific customer segment.

Next, set realistic revenue targets using overall market growth as a benchmark. If your industry expands by 25 percent, a 10 percent growth rate might be too low, while 50 percent is likely too high.

Look for a template that fits your business goals and revenue targets.

Consider Your Business Type & Plan Ahead for Sales Fluctuations

Your business type is one of the most important factors to consider when selecting a template. The size, industry, age, and growth rate can all impact which template will work for you.

Also, consider how often your sales fluctuate. For example, an eCommerce store may have 10 to 15 fluctuations a year, so they need a template that can handle their data. On the other hand, a small fly fishing business may have just two fluctuations—on and off-season.

Look for a template that suits your business model and accommodates your sales fluctuations.

Decide Which Method of Sales Forecasting to Use for Your Sales Team

When it comes to sales forecasting methods, there is no one-size-fits-all solution.

You'll need to adjust your forecasting based on your historical data, the metrics you need to track, and your confidence in the data. Your goals and KPIs also impact the forecasting methods you use.

Here are seven sales forecasting methods, including who should use them:

• Lead-driven forecasting : Looks at previous lead conversion rates and projects future sales based on current lead volume. Best for organizations with clear historical data and a steady stream of inbound leads, such as SaaS or technology companies.
• Length of sales cycle forecasting : Tracks how long a typical lead takes to close based on lead type. Best for organizations with insights into the entire sales pipeline and well-aligned sales and marketing teams, especially B2B.
• Opportunity stage forecasting: Calculates how likely a lead is to close based on specific actions and lead type. Ideal for businesses with good historical data on closing rates.
• Test-market analysis forecasting: Leverages data from a soft release to get a sense of projected revenue. Best for startups or businesses launching a new product line or service.
• Historical forecasting : Forecasting data based on historical data and market trends. Works well for any business with at least a year of historical data.
• Multivariable analysis: A complex analysis that considers multiple factors and closing ratios. Best for companies with varying deal sizes and close rates or selling multiple products or services.

Make sure whatever template you choose fits your analysis method.

Look at Historical Data & Past Sales Metrics

We've already discussed how historical data can impact your sales forecasting, but it's also an important factor in choosing the right template.

Before choosing a template, look at your past metrics and historical data. How much data do you have? Consider a template with a longer forecasting model if you have several years' worth of data.

What data do you want to include based on your business type and forecasting methods? Make sure the template you choose includes the fields important to your business.

Research External Market Conditions to Create an Accurate Sales Forecast

Finally, spend a few hours researching current market conditions and consider how they may impact your sales forecast. For example, if your industry is growing fast, you might select a forecasting template that updates in near real-time.

On the other hand, if a large competitor is acquiring another company, growth might be more challenging, and you might need to lower your growth expectations.

Look for a template that works well with current market conditions.

How Do You Calculate Sales Forecasts Quickly?

Here’s a simple formula that SaaS businesses can use for a specific forecast period:

Number of expected new customers x Average deal size

The accuracy of such a forecast depends on various factors, including your churn rate, upsells, changes to your existing subscriptions, market conditions, etc. The more informed your assumptions, the better your accuracy.

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How to Create a Custom Sales Forecast Template: Five Easy Steps

Sometimes, you need to do it yourself. Sales forecasting can be simple—especially if you create a forecasting template based on your own sales process and KPIs. Assuming you’re already tracking your sales, here are the steps to create your own template.

Step 1: Choose Sales Performance Metrics

What do you want to track? Whether it’s the sales quotas of individual sales reps, your gross profit, or simply one-year sales projections, choose KPIs based on your goals.

You can check out this exhaustive list of KPIs , but most SaaS businesses can start by calculating their run rates. Keep in mind that it requires a few months of revenue data to project your annualized revenue.

Here's the sales run rate formula :

Projected sales = Run rate (Current sales/number of sales periods elapsed) X the remaining number of sales periods

This is one of the easiest ways to predict future growth, and it’s a great starting point. We’ll refine it in the fourth step, but now, let’s start creating a template.

Step 2: Create a Layout for Your Template and Add Formulas

Now, add relevant formulas for your chosen metrics so that your sheet can make automatic forecasts based on your data input.

The specific columns you include in your layout depend on the KPIs you want to track and the information you want to include.

If we were calculating the annual run rate, you could use one column for the month, another for the sales in that month, and another for calculating the total sales up to the current month.

Next, you want to create formulas for the average monthly rate and the annual run rate formula (ARR), which will be your average monthly sales X 12. These two can be additional columns.

Step 3: Calculate Your Sales Forecast

Now, it’s time to test your template. Input data and let the spreadsheet automatically calculate your sales forecast. In our example, after inputting data for January through March, here’s what the forecasted annual run rate looked like:

Step 4: Adjust for External Factors and Strategic Business Plans

Our simple run rate formula doesn't consider seasonality, competition, market changes, or business growth.

If seasonality or trends impact your sales, calculate the percent change from your average month during periods of spike or dip. For example, if your sales typically spike by 30 percent in November, you can adjust your sales run rate to account for these trends.

Internal changes can also impact sales forecasting. Are you launching new products ? How have product launches performed in the past? Are you marketing to new customer segments? How many new customers do you expect these new markets to add to your customer file?

Refining your formula will improve your forecast's accuracy, leading to informed sales plans and decisions.

If you want to create a comprehensive SaaS revenue forecast model from scratch in Excel, check out this tutorial .

Step 5: Integrate the Template Into Your Process (& Keep Improving It)

Most sales reps spend only one-third of their day selling to prospects. So, you want to integrate the sales forecasting template into your workflow naturally so it doesn’t diminish productivity. Work to blend it with your team's existing spreadsheets or software.

Set up a regular cadence for importing data into the template—either manually or automatically from another software. Then, generate forecasts based on inputted data.

To keep your forecasts relevant, regularly review the accuracy of the results. Adjust your template as needed, and remember that a change in business strategy or market conditions should also invite revisions.

Want to sophisticate your forecasts and consider advanced trends? Then, you must use evolved sales forecasting methods. Get more detailed insights into sales forecasting here .

Using Forecasting Templates to Predict + Optimize Future Revenue

When it comes to sales forecasting, the right template can make all the difference. If you're still doing the process manually, you might miss out on actionable insights that could help your team meet and exceed your sales goals. Plus, manual forecasting takes a lot of valuable time—and is prone to error.

So, choose one of the above templates to create a standardized forecasting approach for your company, but don’t be afraid to make it your own. Add columns, include metrics that matter, and even plug in your brand color and name.

Or, you can just design a template from scratch.

Remember that your template isn’t static. Keep refining your forecast assumptions, and iterate to improve accuracy. Over time, you'll end up with a custom sales forecasting spreadsheet that makes you look like a superstar—and boosts your revenue potential.

Want even more actionable insights? See how Close gives you access to the reporting metrics that matter .

But even if you’re working without a CRM or using another product to manage your sales process, grab our free sales forecast template to achieve your goals that much faster.

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Home » Business » Free Sales Forecast Template (Word, Excel, PDF)

Free Sales Forecast Template (Word, Excel, PDF)

A sales forecast template (Word, Excel, PDF) is used by the sales teams and maybe the marketing or sales managers to make projections of the sales of different things, products, or items you purchase. A sales projection is a fundamental piece of a marketable strategy. It is additionally basic in the event that you are hoping to get a bank advance or financial specialists.

The sales forecast template gives you a chance to break down and conjecture the unit deals, development rate, net revenue, and gross benefit for your items and administrations. It gives a speedy beginning stage to set up your business estimate and incorporates some specimen diagrams. You may also like hold harmless agreement template .

Anticipating sales of your item or administration is the beginning stage for the money related projections. The business gauge is the way to the entire money related arrangement, so it is imperative to utilize practical appraisals. Partition your anticipated month to month deals into “Classifications”, which are common divisions that bode well for your sort of business. Run of the mill classifications may be product offerings, divisions, branch areas, client gatherings, topographical domains, or contracts.

To concealment of many centers without a moment’s delay, there are different sales templates available online all of which can be downloaded for nothing. Notwithstanding a business activity design format, you’ll discover a pipe layout to help imagine the business procedure, a business gauge layout for making projections, deals tracker, and report layouts for gathering imperative information, a pipeline for following contacts, and that’s only the tip of the iceberg. We’ve likewise included deals with email formats to improve correspondence with leads. You should also check the expense report template .

Utilizing a business format gives simple association and productivity, authorizing assets, and time that can be utilized toward achieving business objectives. A format can likewise be a compelling specialized instrument for deals and promoting groups when creating and progressing in the direction of offers targets. Contingent upon the nature and extent of your business, a few formats can likewise be incorporated as a feature of a compelling strategy for success. You may also see the business plan template .

Table of Contents

Benefits of Using Sales Forecast Template:

• You can track your item by item budget.
• You can forecast or project your sales of different items in different periods.
• You can compare the projections with the actual ones.
• Customize able
• Easy to use.
• Enhanced decision making

12 Month (One Year/1 year) Sales Forecast Template Excel

Weekly Sales Forecast Template

Monthly Sales Forecast Template Word

Strategic Sales Forecast Spreadsheet

3 Month Sales Forecast Template

3 Year Sales Projection Template

Business Plan Sales Forecast Template

Sales Forecast Example Business Plan

Sales Forecast Excel Template

Sales Forecast Template Excel Free

Sales Forecast Template for Startup Business

Sales Projection Template Excel

Sales Revenue Forecast Template

Additional Reading: How to Do a Sales Forecast? ( link )

How To Use Sales Forecast Template?

These format templates enable you to design your business objectives with the adaptability and usefulness of an Excel spreadsheet. This business design format is isolated into a year and separate product offerings.

Sections are incorporated for the earlier year’s execution, current deals objectives, and results. Make the design of a yearly deal, and think about information after some time and crosswise over items.

In conclusion, these sales forecast templates are very useful and efficient for the sales managers and the marketing teams.

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I am Ryan Duffy and legal writer. I received a bachelor of business administration (BBA) degree from London Business School. I have 8+ years of writing experience in the different template fields and working with ExcelTMP.com for 7 years. I work with a team of writers and business and legal professionals to provide you with the best templates.

3 Popular Sales Forecast Examples For Small Businesses

• October 9, 2022
• Small Businesses

When creating financial forecasts for their business, entrepreneurs often face difficulties. Yet, there are 3 popular sales forecast examples you can use when creating yours. They work for the most popular revenue models , from restaurants, to retail shops, to software companies and other online businesses.

If you aren’t sure what are sales forecasts, read our article and follow these 5 simple steps to create accurate sales forecasts for your business. Looking for examples instead? In this article we explain what are the most popular 3 sales forecast examples for (almost) any type of business. Let’s dive in.

What is a sales forecast?

A sales forecast is the financial projection of a business’ sales (or revenues, turnover) over a given period. Therefore, sales forecasts are a must have of any financial forecast: by projecting sales and expenses we can then prepare the  4 financial statements  which constitute a financial forecast.

Often, sales forecasts are included within a business plan as part of your projected financial statements. Indeed, investors will want to see your business’ financial projections over a given period. Sales forecasts often are  3 or 5-years projections .

For more information on sales forecasts for small businesses and why they are important, read our article here .

Let’s now dive into the 3 most popular sales forecast examples which work for any type of business, from restaurants, to retail shops, to software companies and other online businesses.

Why are sales forecasts important?

Because sales forecasts are part of your financial forecasts, and ultimately your business plan, it is very important to get it right.

Sales forecasts help you set goals for your business

Sales forecasts aren’t simply a requirement for your business plan. Instead, they also help you set goals for your business. The sales you expect to generate as per your sales forecast should be used as a guidance for your budget and your business decisions later on.

You show you understand your business

Showing investors you’re not only a great entrepreneur but also a well-rounded and omniscient founder is very important to get the best deal. A great sales forecast will help understand how your business generates revenues, what are the different drivers affecting revenue and the potential risks involved.

Investors will give more credit to financial plans based on verified assumptions and reasonable targets. Calculate expected revenue using market size , market share and/or user adoption rates for instance. The more you justify your plan with verified assumptions, the more credible it will be.

You know how much you need to raise

Many entrepreneurs and founders do not really know exactly how much they need to raise.

Sales also drive expenses, so forecasting sales plays a pretty important role when assessing things such as your breakeven or the amount of money you need to raise . Miss the mark and you may be in trouble.

How much cash do you need to cover your losses over the next 12-18 months? The amount of money you need to raise is the result of your financial projections. This is very important to accurately estimate your revenues and expenses.

How to do a sales forecast?

Before we dive into the specifics of creating a rock-solid sales forecast for your small business, let’s first explain which approach you should follow.

Many entrepreneurs make the same mistake when forecasting their sales: they use a top-down approach. So what is bottom-up and top-down sales forecasting? Let’s use an example below.

• Top-down sales forecasting : we forecast sales using from the top down. For example, you make $500k in revenue per year and you forecast the next 3 years revenue by assuming you will capture 3% of your market size (assuming it is $100 million). By following this approach, your annual revenue is 3 years time is $3 million, a 6x increase from today.
• Bottom-up sales forecasting : we forecast sales using operational drivers (from the bottom up). For example, if your $500k sales are a function of your website traffic, we will forecast revenues based on this metric instead. Assuming website traffic increase by 50% each year (as you invest in paid and content), your revenue in 3 years time is $1.7 million, a 3x increase from today.

Bottom-up sales forecasting is the best approach for 2 main reasons:

• It allows us to relate revenues to another metric, helping us making sense of the projection. Does $3 million really make sense given this would mean multiplying website traffic by 6x over the next 3 years?
• Top-down approach requires us to make assumptions on the market size, which is often inaccurate for lack of publicly available data. Instead, bottom-up uses your own business’ historical data

Sales forecasts: 3 popular examples

1. location-based businesses.

If you are running a businesses with a physical location, such as a hotel, a restaurant, a repair shop or a retail store for example, forecasting sales boils down to forecasting street traffic.

Indeed, sales (revenues) are a function of the sales volume you generate (the number of “units” or products you sell). The sales volume itself is a function of the number of people who enter your store, and, by extrapolation, the number of people who pass by your store.

When forecasting sales for a new business, you should look at the location where your business will be based first. Assess the approximate number of people who are passing by.

Note: when assessing traffic, be careful to exclude any external factors (e.g. Christmas day), cyclicality and seasonality. Ideally, your assessment should look at a full week and all work hours in the day.

Once we have established the approximate number of people who pass by the street in a day, we will need to apply conversion rates, in order:

• How many people enter the store?
• Out of the people who enter the store, how many make a purchase?

Of course, if you already have some historical data (if you already run a store and are opening a new one), use your existing conversion rates. Else, make assumptions.

When making assumptions, you should use the data you have collected when making your own observations earlier. Use similar stores to yours, in a different street for example.

For example:

• 5% of people passing by your store enter
• 10% of people entering the store make a purchase

We can now create a simple sales forecast over a week, adding up the average traffic over a typical week:

2. Online businesses

Online businesses often acquire their customers via their website, or any type of online presence.

As such, unlike location-based businesses, sales (revenues) are a function of visitors (and not street traffic). The visitors can be visitors on a website, on a Appstore page (mobile apps) or any type of online lead acquisition page.

We often refer this type of acquisition as inbound acquisition . The traffic is two fold: paid and organic:

• Paid traffic : all visitors coming from paid marketing channels (Google Search, Facebook Ads, etc.). You are either paying for clicks, or impressions. 
• Organic traffic : all visitors landing on your landing page(s) organically (either via a referral link, direct search, social media post, blog article, etc.)

Paid marketing is the easiest way to generate traffic. Yet, because you are paying for each paid visitor, you will need to monitor your  Return on Ad Spend (ROAS)  to make sure your paid marketing campaigns are profitable.

In comparison, whilst you do not directly pay for each organic visitor, organic traffic is not free. Organic traffic is earned from investment into  SEO  and content. Whilst investing into your SEO for instance does not pay immediately, the returns can far outweigh those of your paid marketing in the long run.

So, when forecasting sales for online businesses, we should make assumptions on traffic. For example assuming:

• 30,000 visitors last month: 20,000 paid and 10,000 organic
• 3% monthly increase
• 2% conversion rate
• $50 average purchase price

This is how could look like a simplified sales forecast example for an online business:

3. Lead-acquisition businesses

Lead-acquisition businesses are companies that make sales through their sales teams efforts. This is also known as outbound acquisition (vs. inbound discussed above).

With outbound acquisition, a business acquires customers through its sales team. Whether it is via phone, email, Linkedin or even in-person, the number of acquired customers is a function of the number of sales people.

Outbound acquisition is very common for business-to-business (B2B) companies. For example, Enterprise SaaS and B2B marketplaces use outbound acquisition to acquire their customers.

Outbound customer acquisition is therefore easier to forecast vs. inbound. The simple formula to estimate new customers over time is:

The number of closings per sales person is also referred to as the efficiency of your sales team = the number of customer one sales person acquire (or “close”) each month, in average.

For example, lets’ assume you have 20 sales people. Historically, your sales team has closed (“acquired”) in average 2 B2B clients per month per sales person. Assuming you have the same number of sales persons and the same sales efficiency in the future, we can reasonably expect 40 new customers per month.

Now, assuming 1 new hire every 2 months, a sales forecast example for a lead-acquisition business could look like this:

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All about Sales Plans: Definitions, Tips, and Free Templates

By Kate Eby | July 27, 2018

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In this article, you’ll learn everything you need to know about sales plans: how they relate to sales forecasting and sales pipelines, as well as benefits, challenges, and tips for getting the most out of your sales plans.

Included on this page, you’ll find over 8 free sales plan templates , learn the difference between sales forecasting and sales planning , and find best practices for writing a sales plan .

Free Sales Plan Templates

In this section, you’ll find over 15 free sales planning templates in Microsoft Excel and Word formats.

Sales Plan Template

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This template allows you to plan your sales goals with the flexibility and functionality of an Excel spreadsheet. This sales plan template is divided into 12 months and separate product lines. The template includes columns for the previous year’s performance, current sales goals, and outcome. Create a yearly sales plan, and compare data over time and across products.

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Sales Leads Template

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If you want to keep track of sales leads, but don’t need the full functionality of customer relationship management (CRM) software, this spreadsheet may be adequate for your business. The template has columns for detailed information about each sales lead, including contact dates and status — this allows you to keep track of communications with each customer, plan future contacts and follow-ups, and evaluate potential sales. You can also indicate lead sources on the spreadsheet to monitor your marketing efforts and track how customers are referred to your business.

Sales Tracker Template

This sales tracker template makes it easy to keep track of items sold, along with profit per item and total earned income. You can also track costs, including shipping charges and returns. This template is especially useful for a new business, online retail sales, or any small business that wants to track sales and profits.

Sales Pipeline Template

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This sales pipeline template is an alternative to CRM software and is designed with small businesses in mind, use it to keep track of contacts and estimated sales. It also provides a quarterly sales forecast, along with space to record deal status, projected closing date, and further actions. This simple template is easy to edit and serves as a management tool for your sales pipeline.

Sales and Marketing Plan Template

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Creating an effective sales and marketing plan may involve market research and analysis, evaluating your competition, looking at your sales history, examining future sales projections, and more. Once you have adequate information to develop a sales plan, a template can help you organize the plan into steps that will drive sales. This sales and marketing plan template provides space for identifying your sales goal, target customers, strategies for attracting those customers, marketing tactics and messages, scheduled action steps, and results.

Sales Funnel Template

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This sales funnel template provides a visual representation of the sales process, along with whatever sales data you choose to include. The template can be used as a scorecard to evaluate sales progress, and the funnel makes it easy to visualize the steps in your sales process. This free template is a simple but effective tool for reaching sales and business goals.

Sales Report Template

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Track monthly, quarterly, and yearly sales activity with this free sales report template. Customize the template or use the existing columns to keep track of sales and pertinent data. This sales report template also includes a monthly forecast showing sales history and projections. Use this template to track progress, plan future goals, and create a sales report with pleasing visual design.

Sales Action Plan Template

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Create a sales plan with actionable steps and a scheduled timeline. This template features sections for listing clearly defined goals, methods for measuring success, action steps, ownership for each step, and deadlines. These are all important components of a sales action plan for reducing risk and increasing the probability that you will reach your sales goals.

Using a Sales Plan Template

Finding the right sales template provides easy organization and efficiency, which frees up resources and time that can go toward reaching business goals. A template can also be a powerful communication tool for sales and marketing teams to develop and track their progress against sales targets. Depending on the nature and scope of your company, some templates can be a component of an effective business plan.

The Basics of a Sales Plan

A sales plan outlines sale goals for a cycle, as well as the steps you will take to hit those targets. The sales plan document also defines tools, high-level tactics, target customers, competitors, obstacles, among other details. A strong plan will communicate company goals to the sales team, keep everyone focused on strategy, and delineate priorities.

What Is the Difference Between Sales Forecasting and Sales Planning?

While many people confuse the two terms, sales forecasting and sales planning are distinct concepts. A sales forecast is a future projection of sales based on business and environmental conditions, while a sales plan defines the concrete steps needed to achieve the sales forecast. You can create a sales forecast for your entire business or for a particular initiative over any period of time (examples include an economic forecast; an industry forecast; a company forecast; and a short-, medium-, or long-term forecast).

Sales plans are helpful tools when budgeting for advertising or travel costs, identifying new sales markets, planning for staffing needs, and creating a timeline to reach milestones. But a sales plan is just one piece of the business planning and management — and it relies on accurate sales forecasting. You can get free sales forecasting templates here .

Large organizations, small businesses, and startups can all equally benefit from sales planning. Sales forecasts and plans are most often used by the sales team, although marketers, executives, and even customers may interact with the documents as well.

What Is a Sales Pipeline?

A sales pipeline is a visual representation of where prospective buyers are in the sales process. A sales pipeline can quickly identify a prospect’s position in the buying journey; use that information to support them and respond to their needs appropriately.

While a specific buyer’s journey will vary based on the industry and type of products or services sold, there are three general phases of any sales pipeline:

A prospect initiates contact with a company and explains its needs.

A salesperson provides the prospect with a quote (including the product or service and price).

The prospect purchases a product or service (and thereby becomes a customer).

Use the targeted sales pipeline templates above to track potential customers’ journeys through the process.

What Is the Sales Funnel? 

The sales funnel is a visual representation of the average conversion rate of potential customers and qualified leads move through the sales process. Sales teams can use the sales funnel to help understand the volume of sales, as well as the percentage of each sale that has passed through each sales process stage.

The sales pipeline represents what the seller is doing during the sales process; the sales funnel shows the sales process conversion rates. The sales funnel feeds the sales pipeline; once a lead is converted into a prospect, they move into the sales pipeline.

Benefits of Using a Sales Plan

A high-quality sales plan is one of the key parts of the sales forecasting process as well as the operational plan and the marketing strategy. When done right, a sales plan can provide the following benefits:

• Guide and contribute to business growth.
• Communicate company sales goals, objectives, and strategic direction for the sales team and leadership.
• Expose new angles based on the research performed to fill out the items on the template. 
• Define needed actions during the sales cycle.
• Provide easy monitoring of sales team progress as linked to goals.
• Provide a high-level view of expenses, finances, and risks, as well as the competition and target customers. 
• Improve and track performance by keeping the team focused on the strategy, priorities and achieving shared milestones.
• Inspire and motivate stakeholders.
• Help keep customers and potential customers as the focus.
• Clarify team capabilities.
• Aid in comparison of targets and results.

Best Practices for Writing a Sales Plan

While creating the sales plan, take the following steps in order to create a quality and realistic plan:

• Perform a SWOT analysis.
• Review prior periods’ performance to gather data.
• Base the targets and goals on market research and historical data.
• Verify facts and data being used.
• Break down data by different sales groups (inside sales, outside sales, etc.).
• Make sure the sales team buys in to the plan.
• Identify patterns that can help reach target customers.
• Pick a time period that makes sense for your industry.
• Ensure that the budget is supported by the research.
• Ensure that sales objectives are linked to sales goals, and that sales goals are linked to business goals.
• Break down estimated expenses to meet sales goals into groups (commissions, sales training, sales tools and resources, contest prizes, team building, travel costs, food, etc.). 
• Use the SMART goals model (specific, measurable, achievable, relevant, and time-bound). 
• Measure what you want to manage.
• Keep the plan updated throughout the sales cycle — it’s a living document.
• Keep the plan as simple as possible.
• Look for untapped market segments to target.
• Define the value proposition for potential customers.
• Map out the ideal customer journey.

Sales Plans Challenges

While a sales plan is a valuable tool, creating one does pose some challenges: 

• Creating a sales plan can be very time consuming.
• Inaccurate data will skew forecasts — verify your numbers before you finalize the plan. 
• It’s difficult to predict changing tastes, so forecasts may not be met.
• Rapid growth may increase the workload of the sales team, and throw off forecasts.
• Be careful not to move goalposts mid-cycle.
• Wishful thinking is easy to do, so be realistic and don’t ignore your own assumptions.
• Neglecting to consult with the sales team may prevent them from buying into the plan.
• Neglecting to get feedback from other groups can have a negative impact on the plan.

What Is Included in a Sales Plan?

The sales plan contains numerous sections that provide information to readers, and help guide decisions that will contribute to meeting sales goals.

• Mission and Executive Summary: Include a short history of the business for background.
• Team Structure: Provide a breakdown of the team by sales team, including each person’s role and capabilities. Also include plans for any future hiring.
• Target Customers: Break down the customer list into segments by products or product lines. Build a prospect list that includes referrals, renewals, upsells, and any new segments, and make sure to leverage existing customer relationships.
• Tools, Software, and Other Resources: Include a list of CRM packages or other sales tools (including training tools), and provide any relevant documentation.
• Positioning: Include competitor data, including a comparison of your products with theirs. Anticipate how market trends may impact your business.
• Marketing Strategy: Include pricing information, promotions, and any actions you have planned to increase brand awareness.
• Prospecting Strategy: List criteria for qualifying leads generated by marketing strategy. 
• Action Plan: Include a list of steps needed to hit revenue and sales goals.
• Revenue and Sales Goals: Include measurable, realistic goals that support the overall business. Additionally, supply information on how performance will be measured and monitored, and be sure to base projections off historical data.
• Budget: Include estimated costs (including training, sales tools and resources, team building activities, travel, food, contest prizes, etc.). Make a case for the budget you present.
• Schedule: Provide a timeline that addresses the length of the sales cycle covered by the plan (annual, quarterly, month, etc.).
• Other Items: Consider including a performance review of the prior sales cycle, as well as market and industry conditions that may impact sales.

Improve Sales Planning with Smartsheet for Sales

Sales planning is an activitiy to gain and retain customers, meet changing market demands, and ultimately, ensure business success. While premade templates can help you get started developing your plan, you need a tool to manage all of your sales processes and operations that is accessible to your team in real time and allows you to collaborate and track sales activity across multiple reps.

Smartsheet is a work execution platform that enables enterprises and teams to get from idea to impact - fast. Top performing sales organizations rely on Smartsheet to stay on top of leads, accelerate productivity, and exceed every quota.

Use Smartsheet to build a strong opportunity pipeline, reduce risks and identify blockers, and refine your sales forecast. Improve transparency to process and procedure, optimize operations with cross-department collaboration, and accelerate team output.

Discover how Smartsheet can help maximize your sales efforts, today. 

Try Smartsheet for Sales

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Sales Operations 101: Roles, Duties, Headaches, and Pro Tips

Learn the basics of sales operations and how roles are evolving. Hear from the pros and find tips to remedy sales ops headaches.

Nov 18, 2021

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How to Create a Sales Forecast

11 min. read

Updated October 27, 2023

Business owners are often afraid to forecast sales. But, you shouldn’t be. Because you can successfully forecast your own business’s sales.

You don’t have to be an MBA or CPA. It’s not about some magic right answer that you don’t know. It’s not about training you don’t have. It doesn’t take spreadsheet modeling (much less econometric modeling) to estimate units and price per unit for future sales. You just have to know your own business. 

Forecasting isn’t about seeing into the future

Sales forecasting is much easier than you think and much more useful than you imagine.

I was a vice president of a market research firm for several years, doing expensive forecasts, and I saw many times that there’s nothing better than the educated guess of somebody who knows the business well. All those sophisticated techniques depend on data from the past — and the past, by itself, isn’t the best predictor of the future. You are.

It’s not about guessing the future correctly. We’re human; we don’t do that well. Instead, it’s about setting down assumptions, expectations, drivers, tracking, and management. It’s about doing your job, not having precognitive powers. 

• Successful forecasting is driven by regular reviews

What really matters is that you review and revise your forecast regularly. Spending should be tied to sales, so the forecast helps you budget and manage. You measure the value of a sales forecast like you do anything in business, by its measurable business results.

That also means you should not back off from forecasting because you have a new product, or new business, without past data. Lay out the sales drivers and interdependencies, to connect the dots, so that as you review plan-versus-actual results every month, you can easily make course corrections.

If you think sales forecasting is hard, try running a business without a forecast. That’s much harder.

Your sales forecast is also the backbone of your business plan . People measure a business and its growth by sales, and your sales forecast sets the standard for  expenses , profits, and growth. The sales forecast is almost always going to be the first set of numbers you’ll track for plan versus actual use, even if you do no other numbers.

If nothing else, just forecast your sales, track plan-versus-actual results, and make corrections — that process alone, just the sales forecast and tracking is in itself already business planning. To get started on building your forecast follow these steps.

And if you run a subscription-based business, we have a guide dedicated to building a sales forecast for that business model.

• Step 1: Set up your lines of sales

Most forecasts show several distinct lines of sales. Ideally, your sales lines match your accounting, but not necessarily in the same level of detail.   

For example, a restaurant ought not to forecast sales for each item on the menu. Instead, it forecasts breakfasts, lunches, dinners, and drinks, summarized. And a bookstore ought not to forecast sales by book, and not even by topic or author, but rather by lines of sales such as hardcover, softcover, magazines, and maybe categories (such as fiction, non-fiction, travel, etc.) if that works.

Always try to set your streams to match your accounting, so you can look at the difference between the forecast and actual sales later. This is excellent for real business planning. It makes the heart of the process, the regular review, and revision, much easier. The point is better management.

For instance, in a bicycle retail store business plan, the owner works with five lines of sales, as shown in the illustration here.  

In this sample case, the revenue includes new bikes, repair, clothing, accessories, and a service contract. The bookkeeping for this retail store tracks sales in those same five categories.

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• Step 2: Forecast line by line

There are many ways to forecast a line of sales.

The method for each row depends on the business model

Among the main methods are:.

• Unit sales : My personal favorite. Sales = units times price. You set an average price and forecast the units. And of course, you can change projected pricing over time. This is my favorite for most businesses because it gives you two factors to act on with course corrections: unit sales, or price.
• Service units : Even though services don’t sell physical units, most sell billable units, such as billable hours for lawyers and accountants, or trips for transportations services, engagements for consultants, and so forth.
• Recurring charges : Subscriptions. For each month or year, it has to forecast new signups, existing monthly charges, and cancellations. Estimates depend on both new signups and cancellations, which is often called “churn.”
• Revenue only : For those who prefer to forecast revenue by the stream as just the money, without the extra information of breaking it into units and prices.

Most sales forecast rows are simple math

For a business plan, I recommend you make your sales forecast a detailed look at the next 12 months and then broadly cover two years after that. Here’s how to approach each method of line-by-line forecasting.

Start with units if you can

For unit sales, start by forecasting units month by month, as shown here below for the new bike’s line of sales in the bicycle shop plan:

I recommend looking at the visual as you forecast the units because most of us can see trends easier when we look at the line, as shown in the illustration, rather than just the numbers. You can also see the numbers in the forecast near the bottom. The first year, fiscal 2021 in this forecast, is the sum of those months.

Estimate price assumptions

With a simple revenue-only assumption, you do one row of units as shown in the above illustration, and you are done. The units are dollars, or whatever other currency you are using in your forecast. In this example, the new bicycle product will be sold for an average of $550.00. 

That’s a simplifying assumption, taking the average price, not the detailed price for each brand or line. Garrett, the shop owner, uses his past results to determine his actual average price for the most recent year. Then he rounds that estimate and adds his own judgment and educated guess on how that will change. 

Multiply price times units

Multiplying units times the revenue per unit generates the sales forecast for this row. So for example the $18,150 shown for October of 2020 is the product of 33 units times $550 each. And the $21,450 shown for the next month is the product of 39 units times $550 each. 

Subscription models are more complicated

Lately, a lot of businesses offer their buyers subscriptions, such as monthly packages, traditional or online newspapers, software, and even streaming services. All of these give a business recurring revenues, which is a big advantage. 

For subscriptions, you normally estimate new subscriptions per month and canceled subscriptions per month, and leave a calculation for the actual subscriptions charged. That’s a more complicated method, which demands more details. 

For that, you can refer to detailed discussions on subscription forecasting in How to Forecast Sales for a Subscription Business .

• But how do you know what numbers to put into your sales forecast?

The math may be simple, yes, but this is predicting the future, and humans don’t do that well. So, don’t try to guess the future accurately for months in advance.

Instead, aim for making clear assumptions and understanding what drives your sales, such as web traffic and conversions, in one example, or the direct sales pipeline and leads, in another. Review results every month, and revise your forecast. Your educated guesses become more accurate over time.

Experience in the field is a huge advantage

In a normal ongoing business, the business owner has ample experience with past sales. They may not know accounting or technical forecasting, but they know their business. They are aware of changes in the market, their own business’s promotions, and other factors that business owners should know. They are comfortable making educated guesses.

If you don’t personally have the experience, try to find information and make guesses based on the experience of an employee,  your mentor , or others you’ve spoken within your field.

Use past results as a guide

Use results from the recent past if your business has them. Start a forecast by putting last year’s numbers into next year’s forecast, and then focus on what might be different this year from next.

Do you have new opportunities that will make sales grow? New marketing activities, promotions? Then increase the forecast. New competition, and new problems? Nobody wants to forecast decreasing sales, but if that’s likely, you need to deal with it by cutting costs or changing your focus.

Look for drivers

To forecast sales for a new restaurant, first, draw a map of tables and chairs and then estimate how many meals per mealtime at capacity, and in the beginning. It’s not a random number; it’s a matter of how many people come in.

To forecast sales for a new mobile app, you might get data from the Apple and Android mobile app stores about average downloads for different apps. A good web search might also reveal some anecdotal evidence, blog posts, and news stories, about the ramp-up of existing apps that were successful.

Get those numbers and think about how your case might be different. Maybe you drive downloads with a website, so you can predict traffic from past experience and then assume a percentage of web visitors who will download the app.

• Estimate direct costs

Direct costs are also called the cost of goods sold (COGS) and per-unit costs. Direct costs are important because they help calculate gross margin, which is used as a basis for comparison in financial benchmarks, and are an instant measure (sales less direct costs) of your underlying profitability.

For example, I know from benchmarks that an average sporting goods store makes a 34 percent gross margin. That means that they spend $66 on average to buy the goods they sell for $100.

Not all businesses have direct costs. Service businesses supposedly don’t have direct costs, so they have a gross margin of 100 percent. That may be true for some professionals like accountants and lawyers, but a lot of services do have direct costs. For example, taxis have gasoline and maintenance. So do airlines.

A normal sales forecast includes units, price per unit, sales, direct cost per unit, and direct costs. The math is simple, with the direct costs per unit related to total direct costs the same way price per unit relates to total sales.

Multiply the units projected for any time period by the unit direct costs, and that gives you total direct costs. And here too, assume this view is just a cut-out, it flows to the right. In this example, Garrett the shop owner projected the direct costs of new bikes based on the assumption of 49 percent of sales.

Given the unit forecast estimate, the calculation of units times direct costs produces the forecast shown in the illustration below for direct costs for that product. So therefore the projected direct costs for new bikes in October is $8,894, which is 49% of the projected sales for that month, $18,150.

• Never forecast in a vacuum

Never think of your sales forecast in a vacuum. It flows from the strategic action plans with their assumptions,  milestones , and metrics. Your marketing milestones affect your sales. Your business offering milestones affect your sales.

When you change milestones—and you will, because all business plans change—you should change your sales forecast to match.

• Timing matters

Your sales are supposed to refer to when the ownership changes hands (for products) or when the service is performed (for services). It isn’t a sale when it’s ordered, or promised, or even when it’s contracted.

With proper  accrual accounting , it is a sale even if it hasn’t been paid for. With so-called cash-based accounting, by the way, it isn’t a sale until it’s paid for. Accrual is better because it gives you a more accurate picture, unless you’re very small and do all your business, both buying and selling, with cash only.

I know that seems simple, but it’s surprising how many people decide to do something different. The penalty for doing things differently is that then you don’t match the standard, and the bankers, analysts, and investors can’t tell what you meant.

This goes for direct costs, too. The direct costs in your monthly  profit and loss statement  are supposed to be just the costs associated with that month’s sales. Please notice how, in the examples above, the direct costs for the sample bicycle store are linked to the actual unit sales.

• Live with your assumptions

Sales forecasting is not about accurately guessing the future. It’s about laying out your assumptions so you can manage changes effectively as sales and direct costs come out different from what you expected. Use this to adjust your sales forecast and improve your business by making course corrections to deal with what is working and what isn’t.

I believe that even if you do nothing else, by the time you use a sales forecast and review plan versus actual results every month, you are already managing with a business plan . You can’t review actual results without looking at what happened, why, and what to do next.

Tim Berry is the founder and chairman of Palo Alto Software , a co-founder of Borland International, and a recognized expert in business planning. He has an MBA from Stanford and degrees with honors from the University of Oregon and the University of Notre Dame. Today, Tim dedicates most of his time to blogging, teaching and evangelizing for business planning.

Table of Contents

• Forecasting isn’t about seeing into the future

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FREE SALES FORECAST TEMPLATE

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Looking to forecast your revenue? The free sales forecasting template is an essential tool for a business of any size.

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Forecasting is one of the most difficult activities for sales leaders. Without accurate forecasting, you won't be able to determine ahead of time if your team will hit quota. The best sales leaders look at various data points to drive their business decisions from how many new sales reps to hire to prioritizing pipeline opportunities to each rep. By forecasting sales, you can make effective decisions about hiring, marketing, and expansion.

The sales forecasting template will help you:

-  Easily track deals in your pipeline -  Determine which deals to prioritize for your team to hit quota -  Accurately predict your sales revenue to guide business decisions -  Plan for future growth

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Sales Forecast Template

A sales forecast is an essential part of a business plan. It is also essential if you are looking to get a bank loan or investors. Our free Sales Forecast Template lets you analyze and forecast the unit sales, growth rate, profit margin and gross profit for your products and services. It provides a quick starting point for setting up your sales forecast and includes some sample charts.

License : Private Use (not for distribution or resale)

"No installation, no macros - just a simple spreadsheet" - by Jon Wittwer

Description

This Excel spreadsheet lets you compare and analyze multiple products and services by enter monthly units sold, unit price and cost of goods sold (COGS). The template then calculates the total revenue, growth rate, margin per unit, and gross profit.

Note: If your service is based on an hourly rate, you can enter the number of hours under Units Sold and the hourly rate under Unit Price.

The final two columns compare the yearly totals for Year 2 vs Year 1 and Year 3 vs Year 2.

In a business plan or presentation, you should probably use a chart to help communicate your forecast. We've included a few sample charts, both for the first year's data as well as all 3 years. Remember to use charts that effectively and accurately communicate your sales to lenders and investors.

Printing Monthly or Yearly Forecasts

The spreadsheet was designed to let you print a couple different types of reports using the same worksheet. If you make significant changes to the template, you will probably need to make adjustments with the Page Break Preview, page scaling, or other Page Layout options.

If you print the worksheet as-is, you will have each 12-month year on one page with the final page showing the yearly comparisons.

For a Year-to-Year summary on 1 page , you can hide the columns containing the monthly data prior to printing.

Sales Forecasting Resources

• Financial Projections Template at score.org - An Excel Workbook that helps you see the potential of a business idea. If you are starting a new business, this can be a great resource because it combines a lot of important statements and projections into a single workbook.
• Financial Forecasting at TheStartUpPath at youtube.com - A great overview of the important details to consider when creating a sales forecast.

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Related templates.

Financial Statements

22 Sales Projection Templates for 2021 Forecasts

Casey O'Connor

What Is Sales Forecasting?

Types of sales forecast templates, forecasting templates for startups, forecasting templates for businesses with multiple products, forecasting templates for b2b companies.

Sales projection templates can help you quickly and easily create an accurate, data-driven sales forecast for your team.

Sales forecasting is an important exercise for any sales team that wants to see significant year-over-year growth and the ability to fine-tune their sales process in specific, targeted ways. 

In this article, we’ll go over the basics of sales forecasting, as well as provide various forecast templates to help you streamline the process. 

Here’s what we’ll cover:

• Top Forecasting Templates for Startups

A sales forecast is a data-driven prediction of the financial outcomes a business will most likely see at the end of a given time period. A sales forecast can provide insight into the performance of individual sales reps, full sales teams, or even entire organizations. 

For overworked salespeople, making financial projections about future sales that may or may not come to fruition can seem like an exercise in futility. But a thorough, carefully considered sales forecast can be a huge asset to your business .

In order to create an accurate sales forecast, consider how the following factors currently impact your bottom line:

Your business goals are a very important benchmark for your sales team to keep in mind as you create your sales forecast. While your goals may not directly factor into the actual template, they will help steer your decision-making processes. Both short-term and long-term SMART goals will help give structure to your forecast.

Sales Process

Your sales process map will be another helpful tool in creating your sales forecast (if you don’t have one yet, check out our tips on creating one here ). Use your sales process map to pull data points and determine areas of strength and growth.

Company Standards

Chances are that your sales team is made up of salespeople from all different backgrounds and experiences — what one sales rep considers a “qualified lead” may be entirely different from the next. The same goes for things like follow-up communication — how much is too much? Should the follow-up process start on LinkedIn , or via email? 

While it may feel laborious, it’s worth your time to standardize and define these kinds of terms with your team. Use your sales process map to guide this exercise. Having consistency in your metrics will go a long way in pinpointing your sales projections.

In business, every penny counts (this is particularly true for small businesses and start-ups). If you’re not tracking every single penny that goes into and out of your business ( many businesses aren’t ), you need to start ASAP. Your sales projections will only be as accurate as your accounting, and the devil here is in the details. 

Don’t worry — you don’t need to go and cut funds from every department. Sometimes knowing the numbers is just as powerful as trimming them. But you’ll only reap the benefits of sales forecasting if you take a good hard look at the dollars you’re currently spending — all of them. 

Befriend Your CRM

If your company utilizes any CRM software, now’s the time to start maximizing it. Your CRM can be a great way to track the many moving pieces that make up a sales forecast. Make sure you understand its full functionality , as many companies tend to only stick to the surface-level features.

When executed correctly, sales forecasts can give you very valuable insight into various aspects of your sales performance over a period of time. It also gives investors a really compelling reason to inject money into your business — if your forecasted sales are promising, they’ll be much more likely to invest.

Different businesses have different needs for sales forecasting templates. These templates may include things like multiple products, multiple time frames, seasonality considerations, and other variables. It’s important to make sure the template you choose captures the full financial picture without overcomplicating it. 

In general, there are seven main types of forecast templates. Some of these standardized templates may work for your business, but you should also feel free to use these as a starting point, and customize as needed

(Don’t be intimidated by this process — you can do most of this with Microsoft Excel or Google Sheets!)

1. Lead Driven Forecasting

With this lead-driven forecasting template , you’ll be relying on extensive knowledge of your leads. Each lead source gets a value assigned, and projections are calculated accordingly.

Because this template requires a lot of data about leads and their behaviors, it may not work well for businesses that are just starting out and still researching their customer base. 

2. Length of Sales Cycle Forecasting

Length of sales cycle forecasting  predicts the probability of a deal closing based on where they are in your sales cycle. It then assigns each deal a value based on how far along they are in the process. 

This template works well for companies who have robust CRM or other automation tools.

3. Opportunity Stage Forecasting

Opportunity stage forecasting is similar to the previous two templates, though it doesn’t account for source of leads or exact length of sales cycle. Instead, it assigns a probability to each prospect based on what stage of the sales process they’re in. 

This template will take these probabilities, assign them a value, and add those values into your sales projection as your leads move through the sales process. 

4. Intuitive Forecasting

Intuitive forecasting is pretty self-explanatory, and the least objective approach to sales forecasting . It relies on a sales rep’s experience to make judgments about how much  value each deal will bring to the company. 

Sales reps might consider any of the following as they make their forecast:

This method is difficult to scale, but it also doesn’t require a ton of historical sales data — it’s a good fit for many startups as they gather sales data. 

5. Test-Market Analysis Forecasting

Test-market analysis forecast templates are used when launching new products. This method requires that you perform and collect data on a small test launch, and apply those results to your overall forecast.

6. Historical Forecasting

This is a very data-driven approach — it uses your historical sales data to predict future  growth. It’s relatively quick and easy, but it has its downfalls. 

Historical forecasting  does not take any external factors into account, like market conditions or sales team changes. It simply looks at your history of sales. It also assumes year-over-year growth, which isn’t always the case. For most companies, historical sales data is a hugely beneficial piece of the sales forecast, but not the entire basis.

7. Multivariable Analysis

This multivariable analysis example spits out forecasts for gross profit and growth rate, but you could also formulate to predict things like profit margin or total revenue.

Without long-term historical sales data, it can be hard for many startups to create detailed projected sales reports. This is also true for older businesses who are launching a new product. In cases like these, it’s best to start with a simple projections template. 

Here are some of the most basic, easiest-to-use templates we found for businesses that are just starting out. Click on the template’s header to download each one. 

8. One-year Sales Forecast

One-year Sales Forecast (Google Sheets):

This template has very few inputs for historical sales data. All you need to include are the year, product, unit type, and the number of units sold. The spreadsheet has built-in formulas that will calculate the remaining rows automatically.

9. Best & Worst Case Scenario

Best & Worst Case Scenario (Excel):

This template works well for companies who have only minimal data, and can give new businesses a target forecast range rather than precise numbers. For startups, this can allow for flexibility while still pursuing aggressive growth.

10. Expense-Focused

Expense-Focused (Excel):

This template does a really nice job of breaking down all the various expenses that go into running a business. It could work really well for startups who are still learning how their cash flows in and out. 

11. Monthly Sales

Monthly Sales (Microsoft):

This template is great for startups that want to cut out the extra noise and simply determine whether their efforts are paying off month-to-month while they’re starting out.

12. Simple Monthly Reporting

Simple Monthly Reporting (PDF):

Businesses with multiple products (many e-commerce businesses fit this description, for example) sometimes struggle to create a sales forecasting template that’s fluid enough to capture the performance of many different profit streams. 

Take a look at some of the best templates we found that are flexible enough to meet those needs. 

13. 12-Month Forecast for Multiple Products

12-Month Forecast for Multiple Products (Excel):

This template is detailed enough to see how each product fits into the bigger picture, but also simple and intuitive enough that a fledgling business could use it effectively.

14. Color-Coded Outputs

Color-Coded Outputs (Excel):

This template does a really nice job of streamlining the data from multiple product sales and arranging them in an aesthetically pleasing and easy-to-read manner. 

15. Opportunity-Based

Opportunity-Based :

This template  allows you to input sales based on deal stage, size, and probability. It’s best suited for companies who have a more developed understanding of their leads and sales process.

16. New Product Launch

New Product Launch (Excel):

This template is great for companies who are launching a new product and want to look at projections for that product in isolation. Because new products sometimes take longer to get off the ground and aren’t necessarily representative of sales projections as a whole, it can be good to look at their performance removed from the bigger picture — at least in the beginning.  

17. Individual Growth Rates by Product

Individual Growth Rates by Product (Excel):

This template does the dirty work for you by breaking down growth rates by individual products, so you can pinpoint the ones that are making the biggest impact.

Here are a few examples of sales forecasting templates for B2B companies.

18. Lead-Driven B2B

Lead-Driven B2B (Excel):

This template allows salespeople to enter data following a lead-driven approach. It assigns a projected value based on what stage the lead is in.

19. Projected Volume

Projected Volume (Excel):

20. Site Traffic Projections

Site Traffic Projections (Google Sheets):

This template download has wonderful step-by-step instructions for inputting your data and analyzing the results. The template uses site traffic as one of its metrics, so it would work best for e-commerce or other heavily web-based businesses.

21. Multivariable Analysis

Multivariable Analysis (Google Sheets):

This template allows for projections based on a number of different variables, including seasonality. The template is great for businesses that have many external variables to consider. 

22. Historical Growth Rate

Historical Growth Rate (Excel):

This template uses your historical sales data to predict future growth. Because the only inputs are past sales, it’s important to make sure that this data is very robust — we recommend at least two years of historical sales figures for this template.

Hopefully, one of many of these templates will be a good fit for your sales forecasts. They can be used as a guide to creating your own custom template in Excel or Google Sheets. Make sure to include the constants — things like unit sold and cost of goods sold — but tweaking the templates can go a long way in making them a more powerful tool for your business.

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• Sales Templates

9 Best Sales Forecasting Templates for Sales Managers

Jun 08, 2022

Although it can be intimidating, a sales forecast is simply an expression of the current and future condition of a company, essentially where you are and where you want to be. As a result, you can think of a sales forecast not only as an analytical tool but a chief motivator, too. 

Unfortunately, a large chunk of sales forecasting is just plain wrong, relying on incomplete data or using poorly-optimized formats. In such a case, getting your hands on sales forecasting templates can save you from making these common mistakes, giving you a forecast to feel confident about . 

So let’s have a quick look at the purpose of sales forecasting, some inner workings, and the principles you can follow to improve those spreadsheet skills (plus some great sales forecasting templates to download).

• What Is Sales Forecasting?
• How to Forecast Sales
• 1. Qualitative Forecasting
• 2. Quantitative Forecasting
• Why Sales Forecasting is Important
• How to Create a Sales Forecast
• Guidelines for Creating a Sales Forecast
• Factors That Can Impact Your Sales Forecast
• 9 Best Sales Forecasting Templates
• Key Takeaways on Sales Forecasting 
• How Dooly Can Help with Sales Forecasting
• What Is Sales Forecasting ?

Sales forecasting is an estimation of sales revenue within a certain timeframe. In much the same way weather forecasts have varying degrees of accuracy, a sales forecast can only ever be a prediction of how well a company may perform in the next week, month, quarter or year. 

Traditionally, there are two types of sales forecasting: qualitative and quantitative. The former relies on expert opinions, while the latter depends on historical data of an earlier sales process.

Finally, a sales process that gives you the freedom to sell.

Use Dooly to keep your deals on track, and your manager off your back.

It’s not always possible to look back at an expansive amount of data, hence the need for a qualitative approach. In this kind of sales forecasting, a sales team will use their specialist knowledge to analyze the past operations and projections of comparable companies. These industry experts will undertake extensive market research, which will include consumer surveys and employee polling. In doing so, they can create an informed prediction on future sales revenue along with the growth rate.

When a company already has a track record, that data can be leveraged for a quantitative sales forecast. This is also called “historical forecasting” because it is used to make informed decisions based on past results. As long as sales metrics are used (attainment, contract value, deal cycle, CRM score, etc.), the forecast can be quantified, and is thus unbiased. The most basic method is linear extension, which looks at the revenue increase or decrease across a shorter period of time and applies it to the next sales period. For longer time frames, linear regression is preferred. 

Though both types of sales forecasting are implemented to predict future revenue, quantitative measures are generally seen as more reliable. However, you cannot really compare the two methods fairly as they are fundamentally distinct. Companies may see the best results by having an integrated approach to their forecasting strategy.

Just as a weather forecast can keep you from getting rained on, a sales forecast allows a company to make better predictions. This applies to not only formulating sales quotas, but also allocating resources and establishing best practices. 

When a company has an ‘accurate’ forecasting strategy, which simply means it works to a consistent level of accuracy, they are infinitely better equipped than competitors who lack such sales tools. As Alexander Graham Bell said, one would imagine on his newly-invented telephone, “preparation is the key to success.”

Proper investment into sales forecasting allows a company to make informed decisions, as opposed to treading somewhat blindly through the fiscal year. After all, if you can’t measure your growth, it’s much harder to catch early warning signs, keep sales activity on track and ultimately value the company.

In the simplest form, a sales forecast can be done through the following steps:

• Compile a list of the goods and/or services to forecast
• Estimate the sales volume of those goods and/or services
• Multiply this estimate by your unit price to calculate revenue
• Multiply the same volume estimate by cost price to calculate costs
• Subtract cost from revenue to calculate profits

The trick lies in step 2, estimating how much of something you will sell. This is where past data proves invaluable, but it also helps to use qualitative techniques such as the bottom-up sales force composite method. In any case, you’ll find this universal framework across all kinds of sales forecasts.

By definition, sales forecasts are imprecise. They’re your best attempt to predict the future, a corporate crystal ball. With that said, there are a few principles that give you the best chance at the right answer:

1. Clearly Define Goals Behind Forecasting

A young company dealing with new logos will take a different approach to their sales forecasting than an industry leader. Consequently, certain sales forecasting models and templates prove a better match for select companies. Taking the time to first acknowledge your key sales goals lets you determine the most relevant sales metrics to use in forecasts. 

If you aren’t sure of your objectives, it’s all too easy to end up using inefficient or ineffective methods, which could then lead you down the dangerous assumption that sales forecasting is unnecessary or useless.

2. Be Accurate from the Get-go

Less than 50% of sales leaders and sellers have high confidence in forecasting accuracy, according to Gartner. This is probably because a sales forecast is often doomed from the start. The trick to forecasting is accuracy, and the trick to accuracy is data. If just half of your sales teams update their CRM records 50% of the time, you’ve got a quarter of the data you need for true accuracy. And in real-world situations, data can be submitted incorrectly or sent to the wrong place, leaving you with even less to work with.

The solution is not to force sales reps to spend more time inputting data (that is an admin activity that will take them away from the main reason you hired them for: selling). That’s why Dooly exists, to help sellers sync their notes and update Salesforce fields automatically , saving time and making sure all the data you need for sales forecasting is in the CRM.

Using Dooly gives you a better dataset, which in turn may allow you to create far more accurate sales projections. It’s also important to regularly review forecasts by carving out a set time every month.

3. Choose the Best Forecasting Method

As mentioned, quantitative measures are a brilliant basis from which to create your sales forecasts. However, you can use your historical data in various ways, and thus come up with a few different kinds of forecasts. Here are just a few examples:

• Historical Forecast: If you’ve just come out of a profitable month, you can apply that success to your next sales period. Say, for instance, you’ve seen monthly sales valuing $200k. The simplest thing to do is to forecast this for the month. However, you can create a more sophisticated forecast by using further data, like measuring the sales of the same period in the previous year, or the previous 3 years. You can incorporate growth into your estimates, also. If you’re seeing a 3% rise in sales month on month, you can add another $6k to your prediction.
• Opportunity Stage Forecast: When you break your sales funnel down into smaller stages, it can give you some indication of how likely you are to close a deal at specific points. Using past leads to give you some indication on success rate, you can forecast future revenue. Let’s say that last year, the fourth stage of your sales pipeline is where 75% of leads became customers. You can now take that data and apply it to the coming year. Calculating the number of current leads at the relevant pipeline stage by your historical win rate (and then by average deal size) allows you to come up with a decent sales forecast.
• Regression Analysis: Regression analysis is when you use an independent variable (e.g. number of sales calls) to forecast the dependent variable (e.g. sales volume). The assumption is that the second causes the first, which in our example would mean a higher number of sales calls equates to greater sales volume. You can use all kinds of metrics and it’s also possible to model the relationships or numerous independent variables. Regression analysis is a fantastic way of determining the major factors that influence your success.

The best forecasting method depends on the situation, such as the age of a company as well as the scale of their operation. It’s also important to note that different methods work within varying degrees of accuracy, subject to a whole host of external factors. It may be helpful to look over some sales forecasting templates. 

4. Use Multiple Sales Forecasts Together

No one said you couldn’t have your cake and eat it, too. Employing multiple kinds of sales forecasts can create better predictions. If you sell a great deal of products, you’ll probably make a forecast using larger categories. However, you’ll of course be interested to track how new products are affecting revenue, in which case you may create specific forecasts. 

Similarly, an annual forecast gives you an impression of where you’re heading, but month-by-month updates give you an ever-increasing amount of data for more realistic estimates. While there’s technically no limit to how many sales forecasts you use, there’s no benefit to going crazy with it. Implement the handful of forecasting methods that give you a clear vision of how you’re performing, and no more. 

Basic sales forecasting operates in a highly idealized world, where the numbers are whole and business is good. In reality, there are numerous factors that can affect your success, and thus the reliability of your sales forecasts.

• Seasonality: If your sales performance fluctuates heavily throughout certain periods, it’s important to take that into consideration. If your sales go through the roof every summer, there’s no use in comparing that quarter to the previous one. Instead, compare it to the same period of past years. 
• Product Changes: The demand for your product, driven by its relevance, quality and value, will obviously impact your forecasting. If you’re forced to raise prices due to increased costs, you should keep an eye on how it affects the numbers. Likewise, the success of new product launches should be taken into account.
• Marketing Efforts: If you’re setting up a new campaign, changing how your email marketing works, or altering your advertising otherwise, your sales forecast should definitely know about it. It’s great if you’ve got previous examples to measure against, but you’ll most probably be applying qualitative techniques to measure the impact of these decisions.
• Industry and Economy Health: sales forecasts are concerned with how well an individual company will likely perform, but this doesn’t mean you shouldn’t look at larger industry trends and general economic conditions. Is your market growing? If so, have you noticed greater competition? A decent sales forecast needs to include this kind of information for context.

Generally speaking, the more external factors you’re aware of, and account for, the more accurate your sales forecasts can be. Identifying trends that influence your sales, whether they’re unique to your company or shared across the market, is critical for getting the details right.

To make accurate sales forecasts you need more than a balance sheet with cash flow data. You need a tool for each sales rep and sales manager to enter sales data and projections.

There’s lot of useful sales forecasting templates available online, but here are the 9 best examples as curated by us. Many of these templates are available for download in numerous formats (Excel, Google Sheets, PowerPoint) and have all of the formulas already inputted:

1. Dooly Sales Forecasting Template

This is the template our sales team uses at Dooly to make an accurate sales forecast. It tracks our core revenue metrics (bookings, ARR, churn, unit economics, financials, funnel metrics, and sales productivity). It also includes a 12-month ARR forecast template (Google sheet) that you can customize for the current year.

2. 3-year Forecast Template from Vertex42

This well-rounded template is a great place to start for annual overviews, allowing you to analyse several products by simply entering sales volume, unit price and costs. You can then see your total revenue, growth, and profit margin. 

3. Budget Forecast Template from Smartsheet

This template can be used for all manner of scenarios, whether project specific or departmental. Presented with an attractive design with nice visual data, you can compare year-over-year figures with the provided metrics or your own.

4. Month-to-Month Forecast Template from TemplateArchive

These sales forecasting templates cover various kinds of sales forecasting, which applies to either short or long-term tracking. Some are more comprehensive than others, but you can read the guide for general tips no matter what your design.

5. 12-month Multiple Product Forecast Template from Smartsheet

This template gives you a yearly view of your catalogue, with space for historical sales, too. It’s impressively customizable, from product information to time periods, so you can easily identify the trends needed for reliable predictions. 

6. Multi-product Forecast Template from TemplateArchive

This sales forecast template allows you to break down your estimates by individual product and see how they’re performing month by month. This is great for when you’ve launched numerous new products, or made big changes to your product list otherwise.

7. Retail Forecast Template from Smartsheet

This retail-specific template is well-suited for mapping out monthly sales and expenses, which includes things like advertising, payroll, and overhead. Simply add your customer numbers, sale per customer and cost per sale. Subtract your expenses and this template will formulate your total sales revenue, as well as gross and net profit.

8. Subscription-Based SaaS Forecast Template from PlanProjections

This template calculates subscription-based revenue, which is ideal for software as a service (SaaS) businesses. It allows you to compare year-on-year growth using metrics such as new sign-ups and paying customer churn. You can also use it to track number of visitors for making predictions on the scalability of your company. 

9. B2B Lead Forecast Template from Microsoft 

This sales forecasting template is a great example of opportunity stage forecasting, letting you record such information as the sales agent, forecast amount and sales phase. This template relies on weighted forecasts, based on the likelihood of closing each opportunity.

• Key Takeaways on Sales Forecasting  

Sales Forecasts aren’t just for appeasing the board. They’re critical for the decision-making process, giving a company the insight they need to avoid pitfalls and take the best courses of action. At the same time, they act as motivation for sales managers and reps, giving everyone a clear goal to work towards. 

The fact that there are so many sales forecasting templates available gives you some indication that plenty of people struggle with creating them. You only need to remember that the value of a forecast hinges on its accuracy. Collecting data isn’t exactly glamorous, but when you’re dealing with your sales figures, it’s as trendy as you like. 

Sales leaders always tell us that due to bad note taking or sales hygiene they struggle to forecast accurately.

Dooly can help you be confident in your pipeline. Dooly makes it easy for sellers to update their pipeline in real-time so you always have an accurate forecast. Curious how it works? See Dooly in action .

Join the thousands of top-performing AEs who use Dooly every day to stay more organized, instantly update their pipeline, and spend more time selling instead of mindless admin work. Try Dooly free, no credit card required. Or, Request a demo to speak with a Dooly product expert right now.

Diego Pineda

Diego Pineda is the author of two novels, 9 non-fiction books, and hundreds of articles and blogs as a science writer, a business writer, and a sales and marketing writer. He's passionate about thought leadership and his latest book is "The Solo Author: How Solopreneurs Earn Money and Authority with a Book Ecosystem."

Table of Contents

Move deals forward faster with these 15 Sales Templates

Ringing in a new era with Mediafly

Deal And Account Health: A Public Service Announcement From Dooly

The Ultimate Guide to Creating a Repeatable Sales Process

Sales Cycle Management

Post Sales Customer Management

Deal Reviews

Process Adoption

Team Handoffs

Account Executive

Sales Leader

Sales Enablement

Customer Success

Product Overview

AccountSpace

Deal & Account Vitals

Chrome Extension

Integrations

Subprocessors

Customer Stories

Help Centre

Customer Love

9 X-Factors

Sales Happiness Index

State of Sales Productivity

Sales Process Report

State of Sales Leadership

Finish the Quarter Strong

Salesforce Notes

Sales Pipeline

Sales Management Software

Sales Forecast

Log a Call in Salesforce

Find Hot Opportunities

Close the Quota Gap

Sales Time Wasters

Why Reps Quit

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What is Sales Planning? How to Create a Sales Plan

Published: December 06, 2023

Sales planning is a fundamental component of sound selling. After all, you can‘t structure an effective sales effort if you don’t have, well, structure . Everyone — from the top to the bottom of a sales org — benefits from having solid, actionable, thoughtfully organized sales plans in place.

This kind of planning offers clarity and direction for your sales team — covering everything from the prospects you‘re trying to reach to the goals you’re trying to hit to the insight you're trying to deliver on.

But putting together one of these plans isn‘t always straightforward, so to help you out, I’ve compiled this detailed guide to sales planning — including expert-backed insight and examples — that will ensure your next sales plan is fundamentally sound and effective.

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In this post, we'll cover:

What is a sales plan?

Sales planning process.

• What goes in a sales plan template?

How to Write a Sales Plan

Tips for creating an effective sales plan, sales plan examples, strategic sales plan examples.

A sales plan lays out your objectives, high-level tactics, target audience, and potential obstacles. It's like a traditional business plan but focuses specifically on your sales strategy. A business plan lays out your goals — a sales plan describes exactly how you'll make those happen.

Sales plans often include information about the business's target customers, revenue goals, team structure, and the strategies and resources necessary for achieving its targets.

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What are the goals of an effective sales plan?

And if (or more likely when ) those goals change over time, you need to regularly communicate those shifts and the strategic adjustments that come with them to your team.

Your sales strategy keeps your sales process productive — it offers the actionable steps your reps can take to deliver on your vision and realize the goals you set. So naturally, you need to communicate it effectively. A sales plan offers a solid resource for that.

For instance, your sales org might notice that your SDRs are posting lackluster cold call conversion rates. In turn, you might want to have them focus primarily on email outreach, or you could experiment with new sales messaging on calls.

Regardless of how you want to approach the situation, a thoughtfully structured sales plan will give both you and your reps a high-level perspective that would inform more cohesive, effective efforts across the team.

An effective sales org is a machine — one where each part has a specific function that serves a specific purpose that needs to be executed in a specific fashion. That's why everyone who comprises that org needs to have a clear understanding of how they specifically play into the company's broader sales strategy.

Outlining roles and responsibilities while sales planning lends itself to more efficient task delegation, improved collaboration, overlap reduction, and increased accountability. All of which amount to more streamlined, smooth, successful sales efforts.

Sales planning can set the framework for gauging how well your team is delivering on your sales strategy. It can inform the benchmarks and milestones reps can use to see how their performance stacks up against your goals and expectations.

It also gives sales leadership a holistic view of how well a sales org is functioning as a whole — giving them the necessary perspective to understand whether they have the right people and tools in place to be as successful as possible.

Sales planning isn‘t (and shouldn’t) be limited to the actual sales plan document it produces. If that document is going to have any substance or practical value, it needs to be the byproduct of a thorough, well-informed, high-level strategy.

When sales planning, you have some key steps you need to cover — including:

• Gather sales data and search for trends.
• Define your objectives.
• Determine metrics for success.
• Assess the current situation.
• Start sales forecasting.
• Identify gaps.
• Ideate new initiatives.
• Involve stakeholders.
• Outline action items.

When putting this list together, I consulted Zach Drollinger — Senior Director of Sales at edtech provider Coursedog — to ensure the examples detailed below are sound and accurate.

Step 1: Gather sales data and search for trends.

To plan for the present and future, your company needs to look to the past. What did sales look like during the previous year? What about the last five years? Using this information can help you identify trends in your industry. While it's not foolproof, it helps establish a foundation for your sales planning process.

For the sake of example, let‘s say that I’m a new sales director for an edtech company that sells curriculum planning software to higher education institutions. My vertical is community colleges, and my territory is the East Coast.

Once I assume this new role, I‘m going to want to gather as much context as possible about my vertical and how my company has approached it historically. I would pull information about how we’ve sold to this vertical.

How much new business have we closed within it in the past five years? How does that compare to how we perform with other kinds of institutions? Are we seeing significant churn from these customers?

I would also want to get context about the general needs, interests, and pain points of the kinds of institutions I‘m selling to. I’d look for insight into figures like degree velocity, staff retention, and enrollment.

Ultimately, I would get a comprehensive perspective on my sales process — a thorough understanding of where I stand and what my prospects are dealing with. That will ensure that I can deliver on the next step as effectively as possible.

Step 2: Define your objectives.

How do you know your business is doing well if you have no goals? As you can tell from its placement on this list, defining your goals and objectives is one of the first steps you should take in your sales planning process. Once you have them defined, you can move forward with executing them.

To extend the example from the previous step, I would leverage the context I gathered through the research I conducted about both my and my prospect's circumstances. I would start setting both broader goals and more granular operational objectives .

For instance, I might want to set a goal of increasing sales revenue from my vertical. From there, I would start putting together the kind of specific objectives that will facilitate that process — like connecting with administrators from at least 30 community colleges, booking demos with at least 10 schools, and successfully closing at least five institutions.

Obviously, those steps represent a streamlined (and unrealistically straightforward) sales process, but you get the idea — I would set a concrete goal, supplemented by SMART objectives , that will serve as a solid reference point for my org's efforts as the sales process progresses.

Step 3: Determine metrics for success.

Every business is different. One thing we can all agree on is that you need metrics for success. These metrics are key performance indicators (KPIs). What are you going to use to determine if your business is successful? KPIs differ based on your medium, but standard metrics are gross profit margins, return on investment (ROI), daily web traffic users, conversion rate, and more.

I kind of covered this step in the previous example, but it still warrants a bit more elaboration. The “M” in SMART goals (“measurable”) is there for a reason. You can‘t tell if your efforts were successful if you don’t know what “successful” actually means.

The edtech sales example I‘ve been running with revolves mostly around me assuming ownership of an existing vertical and getting more out of it. So it’s fair to assume that sales growth rate — the increase or decrease of sales revenue in a given period, typically expressed as a percentage — would be an effective way to gauge success.

I might want to structure my goals and objectives around a sales growth rate of 20% Y/Y within my vertical. I would make sure my org was familiar with that figure and offer some context about what it would take to reach it — namely, how many institutions we would need to close and retain.

Step 4: Assess the current situation.

How is your business fairing right now? This information is relevant to determining how your current situation holds up to the goals and objectives you set during step two. What are your roadblocks? What are your strengths? Create a list of the obstacles hindering your success. Identify the assets you can use as an advantage. These factors will guide you as you build your sales plan.

Continuing the edtech example, I would use the historical context I gathered and the objectives I set to frame how I look at my current circumstances. I might start by considering my goal of increasing revenue by 20% Y/Y. In that case, I would look at the company's retention figures — ideally, that would give me a sense of whether that needs to be a major area of focus.

I would also try to pin down trends in the colleges that we've already closed — are there any pain points we consistently sell on? I might take a closer look at how we demo to see if we might be glossing over key elements of our value proposition. Maybe, I would use conversation intelligence to get a better sense of how reps are handling their calls.

Ultimately, I would try to identify why we're performing the way we are, the inefficiencies that might be resulting from our current strategy, and how we can best set ourselves up to sell as effectively as possible.

Step 5: Start sales forecasting.

Sales forecasting is an in-depth report that predicts what a salesperson, team, or company will sell weekly, monthly, quarterly, or annually. While it is finicky, it can help your company make better decisions when hiring, budgeting, prospecting, and setting goals.

After the COVID-19 pandemic, economics has become less predictable. Claire Fenton , the owner of StrActGro — a professional training and coaching company — states, “Many economic forecasters won't predict beyond three months at a time.” This makes sales forecasting difficult. However, there are tools at your disposal to create accurate sales forecasts .

In our edtech example, I would approach this step by trying to estimate how my sales org is going to fare with the specific vertical we‘re pursuing in the time window we’ve allotted.

The method I decide to go with will depend on factors like how many concrete opportunities we have lined up — in addition to elements like the kind of historical data we have handy, how the reps working these deals tend to perform, and the degree of insight we have about our potential customers.

Let's say I consider those factors and decide to run something called a multivariable analysis. In that case, I could start by taking stock of the opportunities my reps have lined up. Then, I could look at the reps working those deals, their typical win rates, and the time they have to close — among other factors.

For instance, I might calculate that a rep working with a particularly large institution has a 50% chance of closing within the window we‘ve allotted. Using that insight, we could attribute 50% of the potential deal size to our forecast — we’d repeat that process with all of the opportunities in question and ideally get a solid sense of the revenue we can expect to generate in this window.

Step 6: Identify gaps.

When identifying gaps in your business, consider what your company needs now and what you might need in the future. First, identify the skills you feel your employees need to reach your goal. Second, evaluate the skills of your current employees. Once you have this information, you can train employees or hire new ones to fill the gaps.

Continuing the edtech example, let‘s say my forecast turned up results that weren’t in keeping with what we need to reach our goals. If that were the case, I would take a holistic look at our process, operations, and resources to pin down inefficiencies or areas for improvement.

In my search, I find that our sales content and marketing collateral are dated — with case studies that don‘t cover our product’s newest and most relevant features. I also might see that our reps don‘t seem to have too much trouble booking demos, but the demos themselves aren’t converting due to a lack of training and inconsistent messaging.

And finally, I find that a lack of alignment with marketing has prospects focusing on unrealistic outcomes our sales team can‘t deliver on. Once I’ve identified those gaps, I would start to hone in on ways to remedy those issues and improve those elements.

Step 7: Ideate new initiatives.

Many industry trends are cyclical. They phase in and out of “style.” As you build your sales plan, ideate new initiatives based on opportunities you may have passed on in previous years.

If your business exclusively focused on word-of-mouth and social media marketing in the past, consider adding webinars or special promotions to your plan.

In the edtech example we've been running with, I would likely ideate initiatives based on the gaps I identified in the previous step. I would start a push to ensure that our sales content and marketing collateral are up-to-date and impressive.

I would also consider new training programs to ensure that our coaching infrastructure is prioritizing how to conduct effective demos. Finally, I would start to work on a plan with marketing to ensure our messaging is aligned with theirs — so we can make sure prospects' expectations are realistic and effective.

One way or another, I would take the gaps I found and find concrete, actionable ways to fill them. I would make sure that these initiatives aren't abstract. Just saying, " We're going to be better at demos," isn‘t a plan — it’s a sentiment, and sentiments don't translate to hard sales.

Step 8: Involve stakeholders.

Stakeholders are individuals, groups, or organizations with a vested interest in your company. They are typically investors, employees, or customers and often have deciding power in your business. Towards the end of your sales planning process, involve stakeholders from departments that affect your outcomes, such as marketing and product. It leads to an efficient and actionable sales planning process.

This step is sort of an extension of the previous two — once I‘ve identified the key issues and roadblocks obstructing my edtech startup’s sales org, I would start identifying the right people to fulfill the necessary initiatives I've put together.

In this example, I would tap some stakeholders in charge of our sales content and marketing collateral to produce newer, more relevant case studies and whitepapers we can pass along to the institutions we're working with.

I would also go to middle management and either offer more direction for coaching on demos or bring in a third-party training service to offer more focused, professional insight on the issue.

Finally, I would connect with marketing leadership to align on the benefits and outcomes we generally stress when pitching the schools we sell to. That way, we can ensure that the institutions we're connecting with have realistic expectations of our product or service that we can speak to more clearly and effectively.

Step 9: Outline action items.

Once you have implemented this strategy to create your sales planning process, the final step is outlining your action items. Using your company's capacity and quota numbers, build a list of steps that take you through the sales process. Examples of action items are writing a sales call script, identifying industry competitors, or strategizing new incentives or perks.

In our edtech example, some key action items might be:

• Revamp our prospecting strategy via more involved coaching and re-tooled sales messaging.
• Revamp administrator and college dean buyer personas.
• Conduct new trainings on demoing our software.
• See our new prospecting strategy from ideation to execution.
• Align with our sales enablement stakeholders for new, more relevant case studies and whitepapers.

Obviously, that list isn‘t exhaustive — but those are still the kinds of steps we would need to clarify and take to structure a more effective high-level strategy to produce different (ideally much better) results than we’ve been seeing.

One thing to keep in mind is that sales planning shouldn't end with creating the document.

You‘ll want to reiterate this process every year to maintain your organization's sales excellence.

Now that you‘re committed to the sales planning process, let's dive into the written execution component of sales planning.

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How to Write a Winning Sales Proposal (With Sales Proposal Templates and Examples)

Table of contents

What is a Sales Proposal?

Why do sales proposals matter, example of a sales proposal, key components of a sales proposal, how to create a sales proposal, tips to write a sales proposal, what is a sales proposal template, business sales proposal templates, create winning sales proposals with goodmeetings.

The sales process can be long—from the cold calling to closing the deal, there are many steps in between. 

One key step is presenting all the important details about your products and services. This can take a lot of time for both you and your prospect. So, how do you share this information? 

With a winning sales proposal!

A great sales proposal can be the final push to close the deal. It needs to be clear, concise, and convincing. But creating one can be tricky. 

Data shows that – the average sales proposal win rate is only 43% .

That’s why we have prepared this guide. We’ll show you how to create a winning proposal and even share effective sales proposal templates and examples with you. 

Source: Goodmeetings

A sales proposal is a document that outlines the details of a product or service you are offering to a potential client. It explains how your product or service can solve the client’s problems or meet their needs. 

The proposal usually includes information about the – 

• Terms and conditions

It is designed to persuade the client to choose your product or service over others. A well-written sales proposal helps to build trust and shows that you understand the client’s needs, making it easier to close the deal.

Related: Creating a Winning Sales Deck in 2024: A Step-by-Step Guide

Did you know? 30% of sales managers think that the number of proposals sent is the most important measure of productivity.

Here’s why sales proposals matter:

• Clear communication: They explain your product or service in detail – helping clients understand what you offer.
• Build trust: A well-written proposal shows professionalism and that you understand the client’s needs.
• Competitive edge: They highlight what makes your product or service better than others.
• Saves time: They provide all necessary information at once, saving time for both you and the client.
• Close deals: A strong proposal can convince clients to choose your product or service – leading to more sales.
• Professional image: They present your business in a professional manner – improving your brand image.

To put it simply – a sales proposal helps you to convince your prospect that you offer the best solution and inspire them to take action. 

Related: Sales Pitch 101: How to Create a Perfect Sales Pitch

Here is a simple and short example of a sales proposal to give you a rough idea:

Title Page:

Company Name: XYZ Solutions

Client Name: ABC Corp

Date: July 24, 2024

Introduction:

Hi ABC Corp,

We’re XYZ Solutions, and we’re excited to help you enhance your customer service with our innovative software.

Client’s Needs:

We understand that ABC Corp needs a better way to manage customer inquiries and improve response times.

Proposed Solution:

We offer a customer service software that includes:

• 24/7 Support: Our team is available anytime to assist.
• Easy Integration: Seamlessly connects with your current systems.
• Custom Reports: Track performance with tailored reports.
• Basic Plan: $500/month
• Premium Plan: $800/month

Implementation Plan:

• Setup: Install the software within 1 week.
• Training: Provide training for your team over 2 days.
• Go Live: Start using the software and monitor performance.

Terms and Conditions:

• Payment: Due within 30 days of invoice.
• Cancellation: 30-day notice required.

Call to Action:

Let’s schedule a call to discuss how our solution can meet your needs. Please contact us at (123) 456-xxxx or email us at [email protected] .

This written sales proposal example covers the key parts – making it clear and straightforward for the client.

Related: How to Increase SaaS Sales – The Ultimate Guide

Sales proposals vary based on company size, product type, deal size, and buyer type. However, all proposals include a few key components. 

So, no matter the type of sales proposal – you should include:

• Introduction: Briefly introduce your company and the purpose of the proposal.
• Client’s needs: Explain the client’s problem or need that your product or service will address.
• Proposed solution: Describe your product or service and how it solves the client’s problem.
• Benefits: Highlight the key benefits and advantages of your solution.
• Pricing: Provide clear and detailed pricing information.
• Implementation plan: Outline the steps for delivering the product or service.
• Timeline: Provide a timeline for the project or delivery.
• Case studies or testimonials: Include success stories or testimonials from previous clients.
• Terms and conditions: Include any terms, conditions, or legal details.
• Call to action: Encourage the client to take the next step – such as contacting you or signing the agreement.

You don’t have to necessarily include all these things in your sales proposal. Simply pick a good template and customize it as per your requirements. 

Related: 15 Best Sales Methodologies You Need to Know

Now that we know the basic elements of a sales proposal – let’s learn how to create one. While sales proposals are all about providing information – how you gather and present that information can make a big difference in how your proposal is received. 

Here are the steps you need to follow to create a winning proposal:

• Understand the client’s needs

Research: Start by gathering information about your client’s business, their challenges, and their goals. This helps you tailor your proposal to their specific needs. Did you know? Top sales reps spend 6 hours a week looking into their sales accounts.

Ask questions: If possible, talk to the client directly to understand their pain points and what they are looking for in a solution.

Related: How Does Emotional Intelligence Help in Closing More Deals?

• Create a strong introduction

Introduce yourself: Begin with a brief overview of your company and what you do. Make it clear who you are and why you are the right choice.

State the purpose: Explain the reason for the proposal and what you hope to achieve together with the client.

• Outline the client’s problem or need

Clearly describe the problem or need the client has as you understand it. This shows you are on the same page and highlights why your solution is relevant.

• Present your solution

Detail your offer: Describe your product or service in a clear and simple way. Explain how it addresses the client’s problem or meets their needs.

Show benefits: Highlight the key benefits of your solution, such as how it will save time, reduce costs, or improve efficiency.

• Provide a clear pricing structure

Break down costs: List the costs associated with your solution. Include details like one-time fees, ongoing costs, or any optional extras.

Explain value: Make sure the pricing reflects the value your solution provides, and explain why it is a good investment.

Related: 12 Best Sales Analytics Software To Measure Sales Performance

• Outline the implementation plan

Detail the steps: Provide a step-by-step plan of how you will deliver the solution. Include timelines, milestones, and key deliverables.

Assign responsibilities: Clarify who will be responsible for each part of the project, both on your side and the client’s side.

• Set a timeline

Provide a timeline for when the project will start and finish. Include important dates and deadlines to keep everything on track.

• Include case studies or testimonials

Share success stories: Include examples of similar projects you’ve successfully completed. This builds credibility and shows the client that you can deliver results.

Add testimonials: Include quotes or feedback from previous clients who were satisfied with your work.

• Define terms and conditions

Include any terms, conditions, or legal requirements related to the project. This might cover payment terms, warranties, or cancellation policies.

• Add a call to action

Finish with a clear call to action, such as scheduling a meeting, signing the agreement, or contacting you for more information. Make it easy for the client to take the next step.

• Review and edit

Check for errors: Proofread the proposal to make sure there are no mistakes or unclear sections. A polished, error-free document shows professionalism.

Get feedback: If possible, have someone else review the proposal for clarity and effectiveness.

By following these steps, you’ll create a detailed and effective sales proposal that meets the client’s needs and increases your chances of closing the deal.

Related: How to Be a Good Salesperson: Tips & Strategies for Success

Here are some tips you can follow when writing a sales proposal to make it more effective:

• Use a sales proposal template

Templates help you get started quickly and ensure you include all the necessary parts. They help keep your proposals consistent in style and format, which looks professional.

• Be clear and concise

Use simple language to make your proposal easy to understand. Keep your content focused and avoid unnecessary details.

• Tailor your proposal

Customize the proposal to fit the specific needs and goals of the client. Show how your solution specifically addresses their problems or needs.

Related: What is a Sales Discovery Call? – Questions, Process and Template

• Use visuals

Visual elements like charts and graphs can help illustrate your points and make the proposal more engaging. Use visuals to clarify information, not to overwhelm the reader.

• Focus on benefits, not features

Emphasize how your product or service will benefit the client rather than just listing features. Connect the benefits directly to the client’s specific challenges or goals.

• Include a compelling executive summary

Provide a brief overview of the main benefits and value of your proposal. Make sure this section captures the client’s interest and sets a positive tone.

• Be transparent about costs

Clearly outline all costs involved, including any additional fees or optional extras. Make sure the client understands the value they are getting for the price.

After sending the proposal, follow up with the client to answer any questions and discuss the next steps. Keep communication open to show your continued interest and support.

These tips will help you create a more effective and persuasive sales proposal, increasing your chances of success.

Related: 12 SaaS Sales Metrics You Should Care About in 2024

A sales proposal template is a pre-designed document that helps you create a sales proposal quickly and easily. It includes sections and headings for key information, such as company details, client needs, and pricing. Using a template ensures you include all important parts and maintain a professional look.

Benefits of Using a Sales Proposal Template

Here are a few benefits of using a sales proposal template:

• Saves time: Templates provide a ready-made structure, so you don’t have to start from scratch. This helps you create proposals faster.
• Maintains consistency: Using the same template for all proposals keeps your documents uniform in style and format – giving a professional impression.
• Includes key sections: Templates usually include all the essential sections so you don’t miss any important details like pricing or terms.
• Improves quality: Well-designed templates often include best practices for proposal writing. This helps you produce high-quality documents.
• Easy to customize: Templates can be easily adjusted to fit different clients and needs – making it simple to personalize each proposal.
• Reduces errors: By following a structured template, you’re less likely to overlook critical information or make mistakes in the proposal.

Fun Fact: Around 49% of companies use sales proposal software to create proposals. 

Related: Sales Conversion Rate 101: How To Measure and Improve Yours

Wondering how to write a sales proposal template? Here are two simple templates you can use to get started:

Template 1: Proposal for Product Sale Template

Company Name: [Your Company Name]

Client Name: [Client’s Name]

Date: [Date]

Hello [Client’s Name],

We’re [Your Company Name], and we’re pleased to present our product that can help [briefly state how it helps].

We understand that you’re looking for [describe the need or problem].

Proposed Product:

Our [Product Name] includes:

• Feature 1: [Briefly describe]
• Feature 2: [Briefly describe]
• Feature 3: [Briefly describe]
• Standard Package: $[Price]
• Premium Package: $[Price]

Delivery Plan:

• Order Confirmation: Within 2 days of placing the order.
• Shipping: Delivered within [X] days.
• Support: Ongoing support for [X] months.
• Payment: Due within 30 days.
• Returns: [State return policy]

Contact us at [Your Phone Number] or [Your Email Address] to place your order or ask any questions.

Related: What is Ideal Customer Profile in Sales – Framework to ICP

Template 2: Proposal for Service Sale Template

Hi [Client’s Name],

We’re [Your Company Name], and we’re excited to offer our services to help [briefly state how it helps].

We know you need [describe the need or problem].

Proposed Service:

Our [Service Name] includes:

• Service 1: [Briefly describe]
• Service 2: [Briefly describe]
• Service 3: [Briefly describe]
• Basic Service Package: $[Price]
• Full Service Package: $[Price]
• Initial Meeting: Schedule within 1 week of agreement.
• Service Start: Begin within [X] days.
• Progress Reviews: Monthly check-ins to ensure satisfaction.
• Cancellation: [State cancellation policy]

Reach out to us at [Your Phone Number] or [Your Email Address] to get started or ask any questions.

You can customize and use this sales proposal template free of cost when offering services to clients. 

Template 3: One-Page Sales Proposal Template

Template 4: Detailed Sales Proposal Template

Related: How to Use Generative AI for Sales Success

Creating effective sales proposals involves collecting the right information at the right time. The best way to stay organized is by using a powerful AI-powered sales tools like Goodmeetings .

It helps you to automatically record, transcribe, summarize, and analyze every online sales conversation – thereby eliminating manual note-taking and creating a database of every client call. You can also integrate it with popular CRMs.

This way – you will have all the insights at your fingertips to create a winning sales proposal. You can simply use the search option to pull up specific client conversations and use the data (summary and analysis) to create tailored sales proposals for clients.Plus, Goodmeetings provides valuable insights into your prospects’ needs and pain points – with the help of sentiment and Screenshare analytics. This helps you close every deal at record speed.

Want to see how well your proposals are performing? Goodmeetings analytics will show you what’s working and what needs improvement.Request a free demo of Goodmeetings today and start creating proposals that your prospects will love.

Boost Your Sales Proposal Win Rate With Goodmeetings!

What is a request for proposal (rfp).

A Request for Proposal (RFP) is a document that a company or organization sends out when it wants to invite vendors or suppliers to submit a proposal for a specific project or service. 

It outlines the project requirements, goals, and evaluation criteria. The RFP helps the organization compare different proposals and choose the best option.

Related: 12 Sales Dashboard – Examples and Templates

Who creates sales proposals?

Sales proposals are typically created by sales representatives, account managers, or business development professionals within a company. 

What happens after you send your proposal?

After sending your proposal, there can be three possible outcomes:

• Accepted: The client agrees with your proposal and wants to move forward with the deal.
• Rejected: The client decides not to proceed with your proposal, and you might receive feedback.
• No Response: The client does not reply, which could mean they are still considering their options or have chosen another path.

What to do after sending a sales proposal?

After sending a sales proposal, follow up with the client to confirm receipt and address any questions they might have. Be prepared to discuss details, negotiate terms, or provide additional information. 

What is the typical sales proposal template word count?

The typical sales proposal template word count varies depending on the complexity of the proposal, but it usually ranges between 500 and 1,500 words. 

How do I use a sales proposal letter example?

To use a “sales proposal letter example,” start by reviewing the sample to understand its structure and content. Customize it with details specific to your product or service and your client’s needs. Adjust the language and pricing as needed to fit your situation.

Wrapping Up

That’s how you create a winning sales proposal.

It involves clear organization, understanding client needs, and presenting solutions effectively. By using the right sales proposal templates and following best practices – you can create proposals that stand out and win clients. To streamline your proposal process and gain valuable sales insights, try Goodmeetings . Request a demo today and boost your sales

Create Sales Proposals Your Prospects with Love

About the author.

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The MoSCoW Method is a prioritization tool that helps professionals in managing their time and effort .

To do so, it proposes to classify the importance of the different characteristics of a product (or a Project) according to their importance .

Its name is an acronym of the 4 Prioritization Categories proposed (adding two “o”):

• M ust Have .
• S hould Have .
• C ould Have .
• W on’t Have .

Four Prioritization Categories

Must Have : Essential Requirements that the product or project must have.

• Critical Features without replacement.

Should Have : Important desired Requirements for the product or project.

• They can be substituted if necessary.

Could Have : Improvements to the product or project.

• There are different alternatives.

Won’t have : Characteristics agreed not to be adopted .

• No one will waste time implementing them.

Let’s see the first example:

MoSCoW Method example

Imagine that you have been hired to create a Website for a Law firm.

They want a professional Site where people can Register and, once inside, track their court cases .

Since you want to deliver the best possible Site on time, you decide to follow the MoSCoW method .

How does it look like?

Must Have :

• Solid programming without any bugs.
• A Solid Register System.
• A Safe and Reliable personal directory.

Should Have :

• A Fast Site.
• An outstanding Design.
• Notifications sent by e-mail.

Could Have :

• Custom menus.
• Suggestions.
• A Blog section with latest news.

Won’t Have :

• Paid content.
• A Public Members section.

As we usually say, this Method may seem obvious.

Then… Why is it important?

Why is the MoSCoW Method important?

Many of professionals end up wasting time , effort and resources on useless task s that are ultimately not essential at all.

Surely you have experienced this situation working in a Team:

• Everyone spends hours modifying a minor feature and, ultimately, the important thing is missing .

That is why this Method is so important:

• Because it concentrates your efforts and forces you to think about what is really important .

As you can imagine, this Tool can be employed in practically all kinds of situations.

But when do we especially recommend it?

When should you use the MoSCoW Method?

We highly recommend to use the MoSCoW Method:

• To put order and prioritization.
• To avoid wasting time with non-essential touch-ups.
• In order to meet the Essential Requirements.
• When the product can have very different characteristics.

Now, let’s see more examples:

MoSCoW Method examples

We have chosen different real examples where the MoSCoW Method can be of great help for the development of certain products.

Let’s begin:

A Wallet - MoSCoW Method example

Let’s imagine that you are developing a wallet .

As you know, wallets are very modular products.

They can have:

• Several or few departments for cards.
• Coin purse… or not.
• 1 or 2 bill slots.

There is not a canonical wallet (one that is the benchmark for all the others).

• That is why you decided to use the MoSCoW Method to develop it.

After some thoughts, you decide that your wallet:

• 2 bill slots.
• 8 compartments for credit cards.
• High resistance materials and sewing.
• Leather as its main material.
• A translucid Credit card compartment.
• A transverse horizontal compartment.
• A striking color on the inside of the bill slots.
• Completely black exterior color.
• One translucid compartment for small photos.
• A Coin purse.
• A Passport compartment.

Making a Cake - MoSCoW Method example

In this example, we’ll imagine that you are preparing a wedding Cake .

• You have a very rigid deadline (the wedding day, of course).

In addition, as you also know, Cakes can have lots of variations.

• We could say they are very modular .

That is why you decide to use the MoSCoW Method.

How does it look?

Well, your Cake:

• White coating.
• Two sugar figurines on top.
• 6 layers of sponge cake inside.
• Belgian chocolate between the layers.
• Decorations on the edges
• Sugar flowers.
• Chocolate balls.
• Scattered sugar pearls.
• Multicolor layers.
• An excessive amount of decoration.
• Fruit flavor.

Designing a Poster - MoSCoW Method example

You are now an artist hired to Design a poster for a Rock concert.

Obviously, this is a Design job with infinite variations possible.

• Also, you have a close deadline to finish it.

No need to mention that you will use the MoSCoW Method.

Finally, the Poster:

• The name of the Main rock band, very prominent.
• Images and colors that best suit their style.
• A typeface that best suits the musical style.
• An illustration related to Rock in the middle.
• The name of the rest of the bands that will play.
• Where and when it will take place.
• Where you can buy the tickets.
• Nearby metro and bus stations.
• The name of the city.
• The maximum capacity of the stadium
• At what time each band will play.

Summarizing

The MoSCoW Method is a prioritization tool that helps professionals in managing their time and effort.

It proposes to classify the importance of the different characteristics of a product in 4 Categories :

• M ust Have.
• S hould Have.
• C ould Have.
• W on’t Have.

Although this Method can be used in all kinds of situations, we highly recommend to use it:

• When working in a team .
• In Design tasks .
• When there is a close deadline .
• With modular products or projects .
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MoSCoW Matrix Template

Use the MoSCow Method to efficiently place deliverables in a matrix to understand their importance to your team’s projects.

Trusted by 65M+ users and leading companies

About the MoSCoW Matrix Template

When you’re working on a project with a lot of deliverables, it can be difficult to track priorities. And as deadlines approach, sometimes priorities can shift, further complicating your workflow. How can you keep track of evolving priorities and still focus on a complex project? 

What is the MoSCoW method?

The MoSCoW method is a powerful technique for tracking priorities, which are categorized and placed in a matrix model. Project managers, product developers, and business analysts use the matrix to align their teams when working through a set of project deliverables. Teams collaborate with stakeholders to analyze and rank the importance of deliverables with MoSCoW, making it easier to stay on track. 

MoSCoW is an acronym for Must Have, Should Have, Could Have, and Won’t Have. These four priority categories make up the four segments in the matrix. “Must Have” items are necessary for delivery; “Should Have” items are important but not necessary; “Could Have” items are nice to have (they are not priorities, but your team can work on them if time and resources permit); and “Won’t Have” items do not fit into the scope of the current project. To use MoSCoW, you create four category segments showing your current priorities and their status (Complete, In Progress, or Not Yet Started). 

When to use the MoSCoW method

The MoSCoW method is useful whenever you need to present business needs to an audience, assess priorities, and collaborate on impending deliverables with a group of stakeholders. By drawing and updating the matrix, you can get a snapshot of your priorities and their impact at each stage of a project. MoSCoW allows everyone on your team to easily grasp upcoming tasks and their impact on your timeline.

Create your own MoSCoW matrix

Making your own MoSCoW matrix is easy. Miro comes with the perfect canvas to create and share it. Get started by selecting the MoSCoW matrix template, then take the following steps to make one of your own.

Fill in your must-haves.  The MoSCoW matrix is divided into four categories. The first is Must Haves, the items that are necessary for completion of your project. If you’re unsure whether a task is a Must-have, ask yourself the following questions: If you do not complete this task, will your product or service work as intended? Can you still deliver the product without this item? Does this task allow you to fulfill all legal requirements for your project? Will your product or service be safe without it? Will your customer suffer consequences if you fail to complete this task?

Fill in your should-haves.  Next, move on to the items that are not necessary to complete your project but are still important for success. Remember, the items in this category are not  vital , but you should try and incorporate them into your timeline anyway. If you’re unsure, ask yourself: Although it might be painful not to complete this task, could you still ship the product without it? Can you use a workaround to avoid this task?

Fill in your could-haves.  Many teams colloquially refer to these items as “nice-to-haves.” While they might make the service run more smoothly or make your product look better, these tasks are not important. If you have the time or resources to complete them at the end, then you can do so. If not, you can plan to do them later. To fill out this part of the matrix, ask yourself the following questions: What are the benefits of these tasks? Do they outweigh the costs? How will these tasks impact our timeline? Can we still complete the project on time and within budget if we include these tasks?

Fill out your won’t-haves.  These items are outside the scope of your current project. Maybe you don’t have the budget to complete them, or maybe they don’t fit into your timeline. If you’re not quite sure whether something is a Won’t Have, ask yourself: How does this item impact our budget? Does our team have the bandwidth to complete this task? Will this item have a tangible impact on our customers? No one likes to admit that they can’t complete something, but don’t think of Won’t Haves as failures; they’re projects for another day.

How do you use the MoSCow template?

The MoSCoW acronym (excluding the o's) is carved with the first letters of the priority categories it works with. These are Must-haves, Should-haves, Could-haves and Won't-haves. And that's how you can define which task falls into which category.

What are the benefits of using the MoSCow method?

The key benefits of the MoSCoW technique are that it's quick and easy to use. The technique is good for highlighting the priorities of projects that are in progress and for organizing efficient time management.

Get started with this template right now.

3x3 Prioritization Method Template

Works best for:.

Operations, Prioritization, Strategic Planning

It’s all about assessing a task or idea, and quickly deciding the effort it will take and the potential impact it will have—ranked low, medium, or high. That’s what the 3x3 prioritization method does: Help teams prioritize and identify quick wins, big projects, filler tasks, or time-wasters. With nine bucket areas, it offers slightly greater detail than the 2x2 Prioritization Matrix (or Lean Prioritization Method). It’s easy to make your own 3x3 prioritization matrix—then use it to determine what activities or ideas to focus on with your valuable resources.

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Pique their curiosity. Get them excited. Inspire them to keep reading, diving further into your proposal details. That’s what a good executive summary has the power to do—and why it’s a crucial opening statement for business plans, project plans, investment proposals, and more. Use this template to create an executive summary that starts building belief, by answering high-level questions that include: What is your project? What are the goals? How will you bring your skills and resources to the project? And who can expect to benefit?

2x2 Prioritization Matrix Template

Operations, Strategic Planning, Prioritization

Ready to set boundaries, prioritize your to-dos, and determine just what features, fixes, and upgrades to tackle next? The 2x2 prioritization matrix is a great place to start. Based on the lean prioritization approach, this template empowers teams with a quick, efficient way to know what's realistic to accomplish and what’s crucial to separate for success (versus what’s simply nice to have). And guess what—making your own 2x2 prioritization matrix is easy.

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MoSCoW Method In A Nutshell

Prioritization plays a crucial role in every business . In an ideal world, businesses have enough time and resources to complete every task within a project satisfactorily.  The MoSCoW method is a task prioritization framework. It is most effective in situations where many tasks must be prioritized into an actionable to-do list. The framework is based on four main categories that give it the name: Must have (M), Should have (S), Could have (C), and Won’t have (W).

Element	Description
Concept Overview	The MoSCoW Method is a prioritization technique used in project management, product development, and requirements gathering. It helps stakeholders categorize project or product requirements into four priority levels: ust-haves, hould-haves, ould-haves, and on’t-haves, enabling clear focus on essential elements.
	Key elements of the MoSCoW Method include: 1. Critical requirements that are non-negotiable and must be included for project success. 2. Important but not critical requirements that enhance the project’s value. 3. Desirable but optional requirements that may be implemented if resources allow. 4. Requirements explicitly excluded from the project scope.
Must-Haves (M)	Must-Have requirements are fundamental to the project’s success and must be delivered for the project to be considered complete. These requirements are typically essential for achieving project objectives and meeting stakeholder expectations. Failing to deliver Must-Have requirements can lead to project failure or dissatisfaction among stakeholders.
Should-Haves (S)	Should-Have requirements are important but not critical for the project’s core functionality. These requirements enhance the project’s value and may improve user experience or functionality. While they are not indispensable, they contribute significantly to stakeholder satisfaction and project success. Prioritizing Should-Have requirements ensures they receive appropriate attention during development.
Could-Haves (C)	Could-Have requirements are desirable but optional. They represent features or enhancements that would be nice to include if resources, time, or budget permits. These requirements provide flexibility for project teams to explore additional features or improvements that can enhance the project’s appeal or utility. While valuable, Could-Have requirements are not prioritized as high as Must-Have or Should-Have requirements.
Won’t-Haves (W)	Won’t-Have requirements are explicitly excluded from the project scope. These are features or elements that stakeholders have agreed should not be part of the current project. Identifying and documenting Won’t-Have requirements helps manage stakeholder expectations and avoids scope creep by clarifying what is not included in the project.
Benefits	– Clear prioritization: The MoSCoW Method provides a straightforward way to prioritize requirements and focus on critical elements.- Alignment with objectives: It ensures that project teams work on the most essential features that align with project goals.- Scope control: Identifying Won’t-Have requirements helps manage scope and prevents unnecessary additions.- Efficient resource allocation: Resources are allocated based on priority, optimizing project efforts.- Stakeholder communication: It facilitates transparent communication about what to expect from the project.
Drawbacks	– Subjectivity: Determining the priority of requirements can be subjective and influenced by stakeholder perspectives.- Rigidity: The method may not accommodate changes in priority as the project progresses, requiring periodic reassessment.- Complexity: Managing a large number of requirements with this method can become complex and time-consuming.- Conflicting interests: Stakeholders may have differing views on priority, leading to disputes or challenges in reaching consensus.
Use Cases	1. Software development: Project managers use the MoSCoW Method to prioritize software features based on criticality and user needs.2. Product development: Product teams employ the method to decide which product features to include in each release.3. Agile project management: Agile teams integrate the MoSCoW Method into their iterative processes to prioritize work for each sprint or iteration.4. Requirements gathering: Business analysts use the method to categorize and prioritize business requirements from stakeholders.
Examples	classifies user requirements as Must-Have (e.g., login functionality), Should-Have (e.g., user profile customization), Could-Have (e.g., advanced search filters), and Won’t-Have (e.g., integration with legacy systems). prioritizes product features for an upcoming release, with Must-Have features including online shopping and Should-Have features like wishlist functionality. identifies Must-Have user stories for an upcoming sprint and categorizes others as Should-Have or Could-Have for future sprints.

Table of Contents

Understanding the MoSCoW method

Since unforeseen setbacks are inevitable, task prioritization ensures that the most relevant and important tasks are completed first. Projects lacking in task prioritization quickly become disorganized and chaotic. 

Instead of a systematic process, resources are typically assigned to tasks by those that simply have the most influence in the room. Invariably, this comes at the expense of the success of the project and of the organization itself.

The MoSCoW method categorizes requirements based on their intrinsic value to the business . Requirements most commonly take the form of tasks but change processes and objectives can also be analyzed.

The method is based on an acronym from the first letter of four prioritization categories.

In the next section, we will look at each category in more detail.

The four prioritization categories of the MoSCoW method

All requirements are important to MoSCoW method principles, but they need to be categorized according to priority to deliver maximum benefit to the business . 

Here are the four categories in descending order of priority:

• Must have (M) – or requirements that must be satisfied for the project or solution to be a success. These requirements play a vital role in meeting deadlines and satisfying legal or safety standards. If the result of a requirement not being met is project cancellation, then it occupies this category.
• Should have (S) – or important (but not vital) requirements such as a lack of efficiency or unfavorable stakeholder expectations. These so-called “secondary requirements” usually have a workaround and do not significantly impact the project being delivered. In any case, they should only be rectified once “must-have” requirements have been satisfied.
• Could have (C) – this includes requirements that would be nice to incorporate on the proviso that they do not affect anything else. However, leaving them out of the project scope must result in little impact when compared with a “should have” requirement. This category sometimes includes low-cost refinements that are carried out provided there is sufficient time to do so.
• Won’t have (W) – these requirements are either beyond the scope of the project or add little value . They may be feasible for a future project update and should be stored away for later reference. For example, a new rideshare company may shelve plans for a premium car option until usability issues with its app have been resolved.

Advantages and disadvantages of the MoSCoW method

• Ease of use. The method is easy to learn and implement because it is based on basic principles of task prioritization.
• Accuracy. Accurate task prioritization is reliant on group consensus lead by an impartial moderator. It does not rely on biased prioritization where big personalities can influence others.
• Versatility. The MoSCoW method can be used for any project and any sized company.

Disadvantages

• Lack of category sorting. While the method provides clear guidance on categorization, it does not suggest how requirements within the categories should be sorted.
• Bias. Despite the team-based approach, bias can still occur when most requirements are mistakenly placed in the “must-have” category. Some businesses find it helpful to stipulate that no more than 60% of all project requirements can be classified as high priority.

MoSCoW method examples

Below we have listed a few general examples of the MoSCoW method in action.

Developing a project management app

• Must have – task assignment, file attachment, workflow monitoring, and integration with Google Calendar.
• Should have – Kanban view, Notion integration, mobile app version, in-app messaging, and time tracking functionality.
• Could have – collaborative whiteboard (in-app), Chrome support (add-on), integration with Slack, and a feature that visualizes key project advancement indicators.
• Won’t have – video conferencing. 

Designing a block of apartments for a new city development

• Must have – cement, bricks, windows, proper ventilation, fire hoses for each floor, pile foundations, and a stairwell for emergencies.
• Should have – a compact, modular kitchen, doors made from composite material, soundproofed walls, two elevators, at least two bedrooms per apartment, and ducted, reverse cycle heating and cooling.
• Could have – load-bearing balconies (with a balustrade), internal staircases for penthouse apartments, outdoor entertainment areas, and an intercom system.
• Won’t have – traditional gardens, water features, and a separate laundry room for a washing machine and dryer.

Product development for a men’s wallet

• Must have – two slots for banknotes, ten compartments for credit and debit cards, durable construction material, and high-quality sewing.
• Should have – leather as the primary composition, a transverse horizontal compartment, a transparent credit card sleeve, and a small company logo on the outside face.
• Could have – an attractive, timeless color or pattern on the inside of the banknote slots, an additional transparent sleeve for treasured photos, and a small, zippered coin pouch.
• Won’t have – cream or beige colored leather that stains or wears easily, external metal accents that can catch on the material inside the wearer’s pocket.

Purchasing a new vehicle

• Must have – at least seven seats, 4WD, a 5-star safety rating, a hybrid engine, front and rear passenger airbags, adaptive cruise control, tow bar, and Apple CarPlay.
• Should have – reverse parking sensors, electronic brakeforce distribution (EBD), blind spot mirror warnings, an electric driver’s seat with customizable settings, and Bluetooth.
• Could have – lane departure warning system, heated seats, limited slip differential, sunroof, leather upholstery, center airbags, remote parking, intersection-scanning autonomous emergency braking (AEB), and live blind spot video feed.
• Won’t have – a small, four-cylinder engine, screens that are not touch-sensitive, haptic controls that replace buttons, spoiler, and voice recognition.

Building a website for a law firm that wants to enable clients to track their court cases

• Must have – robust coding free from any bugs, maximum uptime, a simple client registration system, a safe and robust personal directory that cannot be accessed by malicious actors, and discoverability on the first page of Google search results for the company name keyword.
• Should have – a modern, intuitive, and responsive design and navigation, email notifications, a site with pages that load quickly, nofollow links to external sites or organizations, a high contrast color scheme, and a prominent “Contact Us” page.
• Could have – a blog section with information on industry news and trends, custom menus with submenus, and an introductory video on the homepage.
• Won’t have – too much text, no whitespace, and pages with no mobile optimization.

Implementing Agile Methodology for Software Development

• Must Have – Daily stand-up meetings, user stories, sprint planning, and continuous integration.
• Should Have – Retrospective meetings, automated testing, backlog grooming, and a product owner role.
• Could Have – Pair programming, test-driven development (TDD), cross-functional teams, and burndown charts.
• Won’t Have – Waterfall project management , lengthy documentation, and a rigid change control process.

Launching a New Mobile App for a Fitness Company

• Must Have – User registration, workout tracking, video tutorials, and a progress dashboard.
• Should Have – Social sharing features, in-app purchases, integration with wearable fitness trackers, and a nutrition tracking tool.
• Could Have – Personalized workout plans, live streaming fitness classes, gamification elements, and integration with health databases.
• Won’t Have – Virtual reality fitness experiences, biometric scanning, and a feature for booking physical fitness classes.

Redesigning an E-commerce Website for a Fashion Retailer

• Must Have – User-friendly navigation, product listings, a shopping cart, and secure checkout.
• Should Have – Filter and sort options, responsive design , customer reviews, and product recommendations.
• Could Have – Virtual try-on feature, saved wishlists, chat support, and integration with social media for sharing fashion finds.
• Won’t Have – Virtual reality shopping, blockchain-based supply chain tracking, and a complete overhaul of the existing branding.

Upgrading Customer Support for a Telecommunications Company

• Must Have – 24/7 hotline, ticketing system, knowledge base, and service level agreements (SLAs).
• Should Have – Live chat support, email support, remote troubleshooting, and a customer portal for issue tracking.
• Could Have – AI-powered chatbots, predictive maintenance alerts, and a mobile app for customer self-service.
• Won’t Have – In-person customer support centers, handwritten correspondence, and fax support.

Developing a New Video Game

• Must Have – Engaging gameplay, high-quality graphics, sound effects, and a clear user interface.
• Should Have – Multiple levels, character customization, leaderboards, and multiplayer mode.
• Could Have – Downloadable content (DLC), virtual reality support, and an engaging storyline.
• Won’t Have – Integration with real-world banking, non-gaming related social networking, and excessive microtransactions.

Expanding Data Analytics Capabilities for a Financial Institution

• Must Have – Data warehousing, data cleaning, reporting tools, and regulatory compliance.
• Should Have – Predictive analytics, data visualization, and role-based access control.
• Could Have – Machine learning algorithms, real-time data processing, and data governance policies.
• Won’t Have – Data storage on personal computers, unencrypted data transmission, and manual data entry.

Enhancing Cybersecurity for a Global Tech Company

• Must Have – Firewall protection, intrusion detection, antivirus software, and employee cybersecurity training.
• Should Have – Regular security audits, two-factor authentication, and secure remote access.
• Could Have – Employee monitoring software, threat intelligence feeds, and a bug bounty program.
• Won’t Have – Open access to sensitive data, default passwords, and publicly shared passwords.

Revamping Supply Chain Management for a Manufacturing Company

• Must Have – Inventory management , demand forecasting, supplier relationship management , and order processing.
• Should Have – Automated replenishment, real-time tracking, and electronic data interchange (EDI).
• Could Have – Advanced analytics, blockchain-based supply chain, and just-in-time inventory .
• Won’t Have – Manual tracking in spreadsheets, paper-based documentation, and decentralized procurement.

Key takeaways

• The MoSCoW method is a requirement prioritization framework. It may be used to classify tasks, objectives, or change processes.
• The MoSCoW method utilizes four requirement categories according to the degree that each requirement impacts the overall project.
• The MoSCoW method is a versatile, accurate, and relatively simple process to learn. However, it can be prone to bias and it does not suggest how requirements within categories should be prioritized.

MoSCoW Method and its Application: Key Takeaways

• MoSCoW Method Overview: The MoSCoW method is a task prioritization framework used to categorize requirements, tasks, or change processes based on their importance and impact on a project’s success. It uses four main categories: Must have (M), Should have (S), Could have (C), and Won’t have (W).
• Importance of Prioritization: Prioritization is essential for effective project management , ensuring that the most critical tasks are addressed first. Without proper prioritization, projects can become disorganized and chaotic.
• Must have (M): These are requirements that must be satisfied for the project’s success. They are crucial for meeting deadlines, legal standards, or safety requirements. Failure to meet these requirements could lead to project cancellation.
• Should have (S): These requirements are important but not vital. They may impact efficiency or stakeholder expectations. Secondary requirements should be addressed after must-have requirements are satisfied.
• Could have (C): These are desirable requirements that could be incorporated if they do not negatively affect other aspects. They may include refinements or features that enhance the project.
• Won’t have (W): These requirements are beyond the project’s scope or add minimal value . They may be considered for future updates or projects.
• Ease of Use: The method is easy to learn and implement.
• Accuracy: Prioritization is based on group consensus, reducing bias.
• Versatility: The method can be applied to various projects and company sizes.
• Lack of Sorting: The method does not provide guidance on sorting requirements within categories.
• Bias: Bias can still occur, with too many requirements classified as must-have. Some businesses set limits on high-priority requirements.
• Project Management App: Must have – task assignment, Should have – Kanban view, Could have – collaborative whiteboard, Won’t have – video conferencing.
• Apartment Design: Must have – proper ventilation, Should have – soundproofed walls, Could have – load-bearing balconies, Won’t have – traditional gardens.
• Men’s Wallet: Must have – banknote slots, Should have – leather composition, Could have – attractive color pattern, Won’t have – easily stained leather.
• Vehicle Purchase: Must have – 4WD, safety rating, hybrid engine, Should have – reverse parking sensors, Could have – lane departure warning, Won’t have – small engine.

Related Framework	Description	When to Apply
	– The is a prioritization technique used in project management to categorize requirements into Must-haves, Should-haves, Could-haves, and Won’t-haves.	– Utilize the during project planning phases to prioritize requirements based on their criticality and impact on project success.
	– The is a set of guiding principles for agile software development, emphasizing customer collaboration, working software, and responding to change over following a plan.	– Align with the principles by prioritizing Must-have requirements to deliver value to customers early and continuously adapt to changing priorities and customer needs.
	– The is a prioritized list of features, enhancements, and fixes that need to be developed in a product.	– Apply the when managing the Product Backlog to categorize items based on their importance and urgency, ensuring that the development team focuses on delivering the most valuable features first.
	– The categorizes customer requirements into Basic, Performance, and Excitement factors, highlighting the varying impact of features on customer satisfaction.	– Integrate the with the to prioritize Must-have requirements that address basic customer needs and Performance requirements that contribute to overall customer satisfaction and loyalty.
	– The is a prioritization framework that factors in Reach, Impact, Confidence, and Effort to determine the priority of tasks or projects.	– Combine the with the to prioritize Must-have requirements with high Reach and Impact, ensuring that resources are allocated effectively to deliver the most value with minimal effort.
	– The is a decision-making tool that helps prioritize tasks based on their urgency and importance, categorizing them into four quadrants: Do First, Schedule, Delegate, and Don’t Do.	– Use the in conjunction with the to categorize Must-have requirements as tasks that are both urgent and important, ensuring they receive immediate attention and action.
	– The is a prioritization tool that visualizes tasks or projects based on their impact and effort required for implementation, helping identify quick wins and long-term projects.	– Employ the along with the to categorize Must-have requirements with high impact and low effort as quick wins that can be implemented rapidly to deliver immediate value to stakeholders.
	– The assesses tasks or features based on their value to the customer and the complexity of implementation, guiding prioritization decisions.	– Integrate the with the to prioritize Must-have requirements with high value and low complexity, ensuring that resources are allocated to deliver high-impact features efficiently.
	– The framework quantifies the impact of delaying a feature or project, considering factors such as lost revenue, increased risk, and customer dissatisfaction.	– Apply the alongside the framework to prioritize Must-have requirements with high Cost of Delay, ensuring that features crucial to project success are delivered promptly to mitigate potential losses and risks.
	– The is a project management technique used to identify the sequence of tasks that determines the shortest duration for completing a project.	– Utilize the in conjunction with the to prioritize Must-have requirements that are critical to project milestones and timelines, ensuring that the project stays on track to meet key deliverables and deadlines.

Related Agile Business Frameworks

Agile Methodology

Agile Project Management

Agile Modeling

Agile Business Analysis

Business Model Innovation

Continuous Innovation

Design Sprint

Design Thinking

Dual Track Agile

Feature-Driven Development

eXtreme Programming

Lean vs. Agile

Lean Startup

Rapid Application Development

Scaled Agile

Spotify Model

Test-Driven Development

Scrum Anti-Patterns

Scrum At Scale

Read Next : MVP , Lean Canvas , Scrum , Design Thinking , VTDF Framework .

Read More: Business Models

Read Next:  Business Analysis ,  Competitor Analysis,   Continuous Innovation ,  Agile Methodology ,  Lean Startup ,  Business Model

Main Guides:

• Business Models
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• Business Development
• Distribution Channels
• Marketing Strategy
• Platform Business Models
• Network Effects

Main Case Studies:

• Amazon Business Model
• Apple Mission Statement
• Nike Mission Statement
• Amazon Mission Statement
• Apple Distribution

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Gennaro Cuofano

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