Scribd
Upload
21 views25 pages

Forecasting & IMS Reading

Forecast

Uploaded by

Ahmed Sheta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
21 views25 pages

Forecasting & IMS Reading

Forecast

Uploaded by

Ahmed Sheta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 25

Dr.

Peter Nabil
► Qualitative Forecasting
► Quantitative Forecasting
► Moving Average Method
► Weighted Moving Method
► Exponential Smoothing
► Regression
► Trend
► Sales vs IMS
► Benefits
► Reading IMS Data

2
➢ Sales forecasting methods can be broadly divided into two
categories: qualitative and quantitative.
➢ The choice of method often depends on the nature of your
business, the data available, and the specific goals of
your forecast.

It uses expert
judgment and
opinion rather
than numerical
analysis, when
historical data
is limited or
when launching
a new product.
1. Expert Opinion:
✓ This method calls upon industry professionals or experts within the
company for their insights into future sales.
✓ They consider market conditions, trends, and other relevant factors to
generate a forecast.
✓ It is useful when launching new products or entering new markets
where historical data is not available.
2. Delphi Method:
✓ A group of experts anonymously answer a series of questionnaires,
with the responses aggregated and shared with the group after each
round.
✓ The process repeats until a consensus is reached.
✓ It reduces the bias of any single opinion and leverages the
collective wisdom of the group.
3. Salesforce Composite Method:
✓ Here, individual salespeople estimate their own sales based on their
understanding of their territories and customers, then aggregated to
form a company-wide sales forecast.
✓ It is often quite accurate, as salespeople are closest to the customer.
4. Buyer’s Expectations:
✓ This method directly involves the customers, asking them about their
purchase intentions through surveys or interviews.
✓ It provides 1st hand insights into customer thinking & plans, but it can
also be time-consuming & depends on willingness to participate.
5. Market Research
✓ This method comprehensively analyzes market trends, competitor
activities, and customer behaviors to predict sales.
✓ Although it can be a complex and time-consuming process, it
provides valuable insights that help align product offerings with
market demand.
Quantitative methods
are data-driven,
relying on numerical
data and statistical
algorithms to predict
future sales.
➢ It is a quick way to gather insights based on past
performance.
➢ The idea is to look up performance from a similar
timeframe and assume the current period’s results will be
equal to or greater than in the past.
➢ Think–looking at July’s sales numbers for the past few
years to predict how much you’ll sell in July of this year.
➢ Depending on what you’re trying to measure, you might
look at variables such as package, price, or time of year.
➢ Historical forecasting assumes conditions remain the
same. Meaning, it’s not so hot when it comes to detecting
and responding to new threats or opportunities.
➢ This forecasting method aims to predict future revenues
by sizing up where your pipeline is right now.
➢ Here, you’ll look at each opportunity to determine its
likelihood of closing.
➢ The variables you’ll measure should be determined by
your company and sales process.

➢ While intuitive forecasting alone isn’t exactly


scientific, it’s still a valuable tool.
➢ To pull it off, you’ll need to use other data-driven
forecasting methods to supplement anecdotal evidence.
➢ Despite the downsides, intuitive forecasting helps teams
understand the intangibles that influence deals.
➢ It is a method that uses deal stage to determine the
likelihood of closing.
➢ Selecta reporting period (quarter, month, year) based on
your team’s targets and the length of the sales cycle.
➢ Then you’ll multiply each deal’s potential value by its
chances of closing.
➢ Then, after you’ve calculated the projected win rates for
each deal, you’ll add up the total to get the total forecast
for your pipeline.
➢ While this method is straightforward, it can produce
inaccurate results.
➢ It looks at data related to how long it takes a lead to close
to forecast reps’ future sales.
➢ One of the key benefits of this method is it allows you to
gather a ton of data.
➢ Say you’re tracking how leads interact with different
touchpoints throughout the buying process.
➢ Insights can be applied to determine the content and
messaging used at different points in the process.
➢ As such, it’s an effective tool for evaluating and
improving your sales process, tactics, and coaching
strategy.
➢ It is a sophisticated method that combines predictive
analytics with elements from the other methods.
➢ Here, you’ll apply predictive analytics tools to your data
ecosystem, which analyze relationships between variables
that could impact sales outcomes.
➢ Variables might include opportunity size, buyer persona,
individual rep performance stats, etc.
➢ You’ll want to mix and match your sales forecasting
methods based on what you’re trying to measure and what
kind of data sources you’re working with.
➢ Simple, straightforward and the most popular method
for short and medium range forecast.
➢ Calculating the average company sales for previous
years then dividing it on the number of years involved.
➢ Require large amounts of historical data.
➢ Assign equal weight to each year is a disadvantage.
➢ Not accurate if sales vary substantially different from
year to year or if there are major differences in
business environment.
➢ Good for products with stable sales.
➢ Sales forecast for the next year =
actual sales for the past 5 years
/number of years (5)
➢ Simple and similar to Moving average method.
➢ Require large amounts of historical data.
➢ Assign different weights to each year is an advantage.
➢ Sales forecast for the next year =
(Year1*0.1) + (Y2*0.2) + (Y3*0.3) + (Y4*0.4)
➢ Simple to use and understand.
➢ A type of modified moving average method but the
sales in most recent period is more weighted.
➢ Requires little data.
➢ Good accuracy for short term forecast.
➢ Poor for medium and long range forecast.
➢ Searching for the appropriated weight takes time.
A B
F
=Forecast(Known new X, Known Ys, Known Xs)

3 2

1
216
=Trend(Known Ys, Known Xs, Known New Xs)

1
2

3
262
14200
Sales Forecast = ((5000 –4000)/4000) * 100
= (1000/4000) * 100
= 0.25 * 100 = 25 %
So Forecast for next year
= (5000 * 25%) + 5000
= 1250 + 5000 = 6250
PPG = Previous Period Growth
Growth of sales in this period vs
the previous same period

MAT = Moving Annual Total V% or MS = Market Share YTD = Year To Date


Sales 1 Year (Backward) Part of the sales from the Sales from the beginning of year
Sales from 1-6-2015 till 30-5-2016 total market Sales 1-1-2016 till 31-10-2016

Market Name

IMS : May be in Price


EV% = Evolution Index Units or in Value IMS include Sales units + Bonus
PPG% of the Product / PPG% of units And so the unit price may
the Market vary from the actual price
➢ Size & growth of the total market
➢ My MS vs competitors
➢ My PPG vs competitors
➢ My EV vs competitors
➢ Value PPG & MS vs Units PPG & MS !!
➢ Product PPG less than total market PPG !!
➢ If PPG MAT more than PPG YTD !!
➢ If PPG YTD more than PPG Month !!
01555665655
Soft Skills – Selling Skills
Leadership – Case Studies
Coaching Sessions
Business Consultations

You might also like