Hopefully by now all of you will have (or at least most of you) heard about how internet companies such as Facebook and Google have been taking your data and using it to expand their advertising abilities by carefully targeting your likes and behaviours. But what most won’t have heard is that your forecasting data is just as important. It’s so important that Amazon wants it, and is making you pay to give it them.
Ok, it’s not as cloak and dagger as I’ve made it seem, but Amazon is now realising the power of forecasting and allowing their customers to access Amazon’s ‘Forecasting machine learning’ without any prior experience to drive future growth of their business. In return, the customer needs to provide their historical and related causal data to gain the best results.
But is this another big company taking our data to propel its own gains? Either way it’s still proof that forecasting is ultimately important to all business small or large
So, putting Amazon to one side, here are some added benefits when forecasting works.
What results can I expect
- An end goal.
- Know future workload.
- Predict cashflow.
All those questions that we, as business owners, ask on a day to day basis when we don’t have a structure or have forecasted for the future. The ability to forecast not only answers these questions but gives us the confidence to go into tomorrow knowing that the choices we make both in direction and financial spend is the right one. Our choices are backed up by factual based forecasting.
As a culture we often say that we wished we could predict the future, although that’s not possible, forecasting does at least get us halfway there.
A clear plan to grow your business
Forecasting is a consequence of good planning. Planning helps us grow. Make sense?
You might have already set targets that outline the growth you want within your business. Just as an example, let’s say a 60% increase in sales over the next 12 months. Theoretically that should be 5% growth each month but in reality, that might not happen. January might be 3% while February 8% growth. This might cause you to think and reflect but by forecasting this can be expected. You’ll know the busy months, and which products will sell more than others and when. Forecasting gives you the confidence in your plan to grow.
Have you ever been so quiet you’ve questioned your own business and whether it was right for you? Or been so busy that you’ve had to skip the occasionally evening or weekend with the family to get everything complete? As highlighted in my opening statement, companies like Amazon believe that this can be predicted by using your historical data to forecast. Know beforehand when you’re going to need additional help so you can get it in place, or when might be a great time to take a holiday without jeopardising anything within the business.
The famous saying by Benjamin Franklin comes to mind: “By failing to prepare you are preparing to fail.”
Forecasting using tools such as SPANCOP
For those new to business, forecasting doesn’t necessarily need years of historical data, in fact you can forecast down to the day by using tools such as SPANCOP. Using SPANCOP you can analyse who is in each stage of your buying cycle, everyone from those that leave as a suspect to those that buy.
Analysing and including your churn rate, average cycle time, time for clients to buy, amount of opportunities, average cost of sale and many more characteristics will allow you to forecast tomorrow based on what’s happened today. As your business grows and you’re able to provide more historical data your forecasting will improve and provide more long term results.
Next steps and further reading.
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One step further. Head over to my Sales Mindset Coach website and view the various range of products available to help you in your sales journey, from live events, free social media groups, and online courses! There’s something for even the smallest business and there is really no reason you cannot start improving your sales today!