Professional Documents
Culture Documents
& Budgeting
1
Breakdown Method
Salesforce Size = Forecasted sales/average
sales per salesperson.
2
Buildup Method
Number of Salesperson= Total selling effort
needed/Average selling effort per
salesperson
3
Assess Territory Workload
4
Sales Forecast
It is estimate of a company’s sale for a specified
future period.
5
Human resource executives use sales forecasts
to project staffing needs, financial executives use
it in establishing and controlling operating and
capital budgets, and production manager uses it
to schedule purchasing and production to control
inventories.
6
Sales Forecasting Concepts
7
Market Potential – it is the highest possible expected
industry sales of a good or service in a specified market
segment for a given time period.
e.g. the market potential for the sales of antifreeze in New
England might be 20 millions gallons annually. (Based on
buyers ability to buy and willingness to buy)
8
Sales Forecasts – is the sales estimate the company actually
expects to obtain, based on the market conditions, company
resources, and the firms marketing plan. The sales forecast is
less then the sales potential since it is based on realistic set of
circumstances.
9
Product Life Cycle
11
1. Forecasting General Economic Conditions
12
2. Estimating Industry Sales
13
3. Estimating Company and Product Sales
14
Qualitative Methods
17
(iv) Survey of Buyer’s Intention
18
Quantitative Methods
20
Sales Budgeting
21
Types of Budget
7. Completion of Projections – here all the input and requests from various
units of the sales function are assembled and tied into a comprehensive
package.
8. Presentations and Review –present and defend its sales budget proposal
to the management.
10. Budget approval – final levels are eventually approved and authorized
for both the sales and the selling expense budgets. Here onwards budgets
are reviewed periodically looking at the on going market conditions and other
external forces.
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