The business environment is becoming more and more intense day by day. So, to stay ahead of your competitors business firms have to anticipate things like sales, raw material, labor force etc. Companies which fail to forecast correctly not only face serious pressure from competitors, but sometimes also encounter disappointment from their suppliers and distributors. To broaden your view, some of the most important benefits of forecasting are given below:
Forecasting helps in determining your financial needs, it helps to estimate how much finance you need to put in your business to achieve the desired amount of revenues. But, the point that should be taken into account while forecasting is to make it realistic; superficial estimation of future purchase and sales yield is not good.
Cut down Expenses
A good prediction about future business operations can save a firm from a lot of expenses. Like the company will not hire excessive human resource. They will purchase raw material with greater accuracy, lowering the storage cost of raw material etc.
To be Competitive
Forecasting plays a vital role when it comes to maintaining a competitive advantage over your competitors. Firms which fail to make right forecast are swallowed by their competitors. Its simple that who anticipates better is well prepared for upcoming marketing trends.
Forecast for VTiger 7
Ordinary CRM systems claim that they provide the tool for forecasting, but all the forecasting they can do is to estimate future sales for their sales reps. It is only one dimension of forecasting. As a whole, forecasting is a complex phenomenon which needs proper handling. VTiger 7’s Forecast extension is designed keeping every aspect of forecasting in mind, moreover, it is very easy to incorporate in your VTiger 7 CRM. Forecast feature is divided into four different categories which are given below:
Pipeline – It comprises of amount which covers all the opportunities (open).
Best Case –In this section the opportunities which you are most likely to close, closed/won are placed.
Closed –In this part of forecasting all the amounts related to closed/won opportunities are placed.
Commit – those amounts that can be assured to close and closed/won opportunity.
Some of the details regarding basic configuration of Forecast extension are discussed below:
Financial Year Starts: In this field, you have to mention the starting month and year from which the forecast is starting. Keep in mind that it is restricted from 2014 to 2020 only.
Forecast Period: Here you will mention the duration of a period. Your forecast can be comprised of monthly, quarter yearly, semi-annually or yearly basis depending on the nature of business and your needs.
Number of Periods: The purpose of this field is to set up a number of periods for which the forecast will be calculated. For example, the period you selected comprises of 4 months, so if you forecast of 6 number of periods that means the forecast of 24 months will be calculated.
Allow Adjustments on: The reason of designing this field is to maintain a backup option if your sales rep made a mistake. For example, if your sales rep under or overcharged an opportunity then using this feature you can modify that entry and can make the adjustment without hassle.
Direct report’s Opportunity: According to this option the superior will only make adjustments in entries made by their direct subordinates.
Direct reports and their subordinates Opportunity: If this option is used rather than the one mentioned above it, any superior can make any changes in the entries done by the employee who comes under them in the management hierarchy. The concept of direct and indirect subordination does not employ while using this feature.
Map Forecast Category to Sales Stage: It is used to make a group of more than one sales stages which then falls into a pipeline or best case or commit or closed forecasts. It helps in reducing the complexity of your sales cycle and improve your firm’s affine.
Information Retained by Forecasting
Once the process of Forecasting is done using the data provided by a business form, in the next step you have to communicate that data. For this purpose, VTiger 7s Forecast extensions data is divided into three different categories depending upon their nature and usage. These three categories are labeled as Forecast hierarchy, Forecast Summary and Forecast Detailed Information. Forecast Hierarchy provides tables in which the hierarchy of sales department are given, with the role of an employee his future expected sales are also given. Forecast summary provides to the point details regarding amounts in the pipeline, Best Case, Commit and Closed Forecasts. Forecast detailed information is for a brief look at four categories of sales forecast, it provides information up to each different period for which forecast was calculated.
It is an extension which can smooth line your business operations quite significantly by making forecasts more precise and quick. So, do not waste your time and incorporate it into your business right now and gain a competitive edge on other market players.