Often sales forecasts are lower than potential because the firm may not have sufficient production capacity to realize its full potential or its distribution network may not be enough developed. Same when financial resources are not enough.
SALES PLANNING GOALS • Support to the company’s objectives and activities • Production planning • Financial planning • Recruiting • Performance evaluation • … • Support to the company’s objectives and activities • Production planning • Financial planning • Recruiting • Performance evaluation • …
THE SALES BUDGETING PROCESS Company’s strategic objectives Sales forecast Sales personnel and activities costs estimation Compare forecasts with the objectives established for the proposed marketing effort In agreement? Establish / Assign sales quotas (bud Revise expenditure categories Request additional funds if necessary
Production on demand : • Annual forecast and budget • Seasonal budget • Collection presentation • Sales and orders fulfillment • Adjustments for material purchases • Production • Deliveries Production on planning : • Annual market evaluation and forecasting • Periodical Planning for production • Production • Presentation and sales or re-assortment • Order fulfillment • Deliveries PRODUCTION ALTERNATIVES
SEASONAL SALES FW Man Collection Jan/Feb. July/Sept FW Woman Pre-Coll. Jan/Feb. June/July FW Woman Main Coll. March July/Sept SS Man Collection July Dec/Feb SS Woman Pre-Coll. July Dec/Feb SS Woman Main Coll. Oct Jan/March Sold in showroom Delivered SS Cruise May Oct/Nov FW Flash Nov May/June Collections presentation and deliveries structure
WHO BENEFITS OF SALES FORECAST? Sales Forecast Finance Production Sales and Marketing Human Resources Others Top Management
WHO BENEFITS OF SALES FORECAST?
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