Do you produce accurate numbers of your forecast and build your business on solid foundation or do they provide false comfort for you and your sales people?

Knowledge of the level of sales; continuous, repeat and new business, you will get in the year to come is essential.

The tool used to forecast sales is the sales pipeline report where information about prospects, customers and specific opportunities is brought together to present a complete view of the future. However, if the source data is unreliable then your projections could just be a pipedream.

Realistic account plans, and trends in ad hoc revenue provide a basis for how much money you will get in, when and at what profit, providing a good foundation for the rest of the business plan. You now have the essential input to the cash flow forecast, a projection of capital requirements, tax planning and the basis for a resource forecast. You also have what you need to talk to the bank, to other investors and to any other key stakeholders in the business.

Accurate pipeline information is a critical success factor (CSF), which needs to be tracked with the same rigour as any other key performance indicator (KPI).

The terms CSF and KPI are frequently over used; most are neither critical nor key. Knowing where the business is, where it will go and by when is CRITICAL and being able to accurately measure this position is KEY to managing a healthy business presenting no unpleasant surprises. Real KPIs provide leading indicators and "the best way to predict the future is to create it".

So, it is critical that your pipeline is populated with dependable data provided by people who understand the importance of its accuracy. It is equally important that they are equipped to provide accurate information and that they have a vested interest in providing a realistic forecast. Hence Pipeline or Pipedream?


A probability calculator used consistently by everyone who provides input to the pipeline report is a valuable tool. The approach to calculating probabilities is crucial and must not allow too much space for creativity and opinion such as "I feel we will get the order", without some solid facts to back it up.

If your sales cycle is say three months, then at the end of March, you should know where you will get orders in April, May and June. As the sales cycle is on average three months with some deals happening more quickly, it would be normal to know where you will get around 95% of the April target, 80% of May's and 60% of June's. You now know what you must do to fill the gaps in each month's target.

As you won't win everything in the pipeline, the total value must be greater than your target for each month and this is factored down by the percentage probability applied to each individual deal. Now you have valuable leading indicators plus the time to address any problems.
This is your short-term forecast which you use to monitor actual revenue potential within the normal sales cycle period.

Activity Management

Continuing to use the example of a three month sales cycle, at the end of March you will have little knowledge of where the business will come from to meet your targets for July, and beyond. To fill the gap you need to monitor the foundation activities which produce the actual opportunities.

Let's say that your monthly revenue target is £100,000 then you must sell an average of £100,000 per month or more to grow. Let's also say that 10 expressions of interest lead to 7 meetings which lead to 4 proposals/quotations which produce 2 new orders at an average value of £50,000.

Before you get to expressions of interest there will be a huge amount of sales and marketing activity which might mean that you have to "touch" say 150 suspects to find the 10 prospects who express an interest. So you would use the selling ratio 150:10:7:4:2 as the basis for monitoring and managing the foundation sales and marketing activity.

Regular pipeline monitoring, commencing when potential opportunities arising from meetings move into the pipeline report, should include both probability and deal value to ensure the overall potential will satisfy your targets.

This is where you get your long-term forecast, hence managing the productivity and effectiveness of activity really matter.


  • If you have never produced forecast before don't worry, make some assumptions and get started
  • Identify the key activities and monitor them rigorously
  • Ensure you have a standard approach to probabilities and that everyone follows it
  • Test the selling ratio regularly to ensure your assumptions are correct
  • Look at the deals done to ensure you are getting the desired result and if not make changes to the ratio and probability rules until you get it right.



  • The BARRETT Sales Blog gives you access to knowledge, research, insight, case studies, and real life, practical experiences in the areas of sales, communication, culture, values, teams, people management, leadership and many many more areas. The author, Sue Barrett has a unique way of getting to the heart of the matter and distills complex ideas into practical tips and suggestions that people can apply in their everyday lives

    Published since February 2007, the BARRETT Sales Blog is designed for people in contact dependant careers such as sales, business development, account management, customer service, sales management, marketing, general management, business owners, leadership, HR management, and anyone interested in learning more about the world of sales, communication, team collaboration and leadership.

    The BARRETT SalesBlogs is easily digestible and sent for free, via email every week.

    Go to the Barrett Sales Blog

  • is owned by BARRETT.

    We want to create a Sustainable Selling community or tribe where like minded business people come together to create a more sustainable and ethical way of doing business.

    Barrett has been in business since 1995 and is an end-to-end sales training, sales consulting, sales strategy and coaching (sales coaching) practice with a prominent reputation in the Australian market as trusted experts and advisors in creating high performing, sustainable people, teams and leaders. With over 50 years shared experience, the Barrett methodology combines process and person to create purposeful action and ultimately achieve excellence.

    We have also created a new online sales education resource called which comprising a) How-to Sales e-books, Research Whitepapers, Barrett 12 Sales Trends Annual Sales Trends Reports, Podcasts, etc. (Please see for current offerings), b) Online Sales Training (you can read about Online training providing general information), c) the Benefits of Online Sales Training (you can read about the benefits that online training provides versus conventional classroom training), d) our Online Sales Training Courses (you can read about the courses we offer and read information about them), but also about e) Sales Resources: tools, templates, coaching resources. etc.

    Sustainable Selling is the creation of Sue Barrett and Jobst Schmalenbach.

    Read more about Barrett