How to Forecast Tent and Marquee Hire Business Sales

Predicting future sales for your Tent and Marquee Hire business is a very chief process; before you embark on your business you should feel assured in forthcoming sales otherwise there is no point in setting up in the first place. It is not likely you will be right on the money but if you do not make a realistic effort your Tent and Marquee Hire business will likely fall short; forecasting is an crucial part to your business stratgey.

Your sales forecast is the fiscal projection of the quantity of turnover your Tent and Marquee Hire business will create from the sales of its products or services. Your sales forecast can stand alone, but it will be closely connected to your Tent and Marquee Hire business plan. It is an essential and fundamental chunk of the planning process and it will be a foremost part of your profit and loss account and cash flow forecast.

So why do you need to forecast sales?

A sales forecast is necessary in order to

1. Plan cash flow - that you will need to add into your business plan when seeking investment, and to avoid unexpected cash flow problems by establishing if and when you will need to inject capital or have access to funds.
2. Manage Cash flow - fundamental to the success of your business, it is critical that you appreciate how sales forecasting contributes to the computation of the cash flow forecast.
3. Plan future resource requirements - for example, you may want a new system which produces more goods.
4. Plan marketing activities - this will visibly have a knock on effect to the quantity of sales you make as well.

Whatever the situation, it is crucial that you study your expected sales regularly and realistically, and take proper action to review your strategy. Your sales forecast is the benchmark against which you should repeatedly assess what actually happens in your business with regards to sales and the important thing is to appreciate the variances and why they transpire, and to incorporate what you have learned into imminent forecasts.

So what do you need to consider?

Your sales forecast should show sales by month for at least the next 12 months, and then by year for the following two years. Three years, in total, is generally enough for most business plans.

You need to consider

1. Is there an well-known market for your product or service?
2. What is the size of the market?
3. Is this an expanding/contracting market and if so; by what %?
4. What are the major considerations for this market?
5. What may well have some bearing on it in future?
6. Is your business seasonal?
7. Are there fashions in your business?

Do you know who your customers are?

1. How many customers will in point of fact buy your product or service?
2. Why will they bring to a close trading from someone else to buy from you?
3. How much will you charge?
4. Can you actually offer the products and services that you are predicting?
5. How many competitors do you have?
6. Your business will not be distinctive; what happens when new competitors penetrate the market once you have done the groundwork to raise market awareness?

You must be transparent about how your products or/and services match the marketplace. To all intents and purposes all business has a quantity of competitor(s) - how can you hoover up your competitors customers? How can you avert your competitors taking your customers? Can you fine-tune your product prices up or down to match new customers - can you without difficulty add or change the services you offer to new and existing customers to strengthen your turnover and profits?

Preparing your Tent and Marquee Hire business forecast

You need to make certain future assumptions for your Tent and Marquee Hire business in order to create a sales forecast

1. Sector increase/decline by a certain percentage e.g. 5%.
2. Planned expansion in the number of workers to generate an expected 20% increase in production.
3. Different location - more customers - 30% increase in sales.

Preparing your forecast

If you sell more than one product or service, you should prepare a separate forecast for each item in your range,and forecast:

1. By volume
2. By value
3. By a combination of both value and volume.

So what are the pitfalls when forecasting sales?

1. Make sure your forecast is based on realistic, verifiable and unbiased info.
2. Don't be tempted to take no notice of your investigation if it showed negative results.
3. Don't make projections only on past performance. Keep looking at what else might impinge on your sales in the future and alter your forecast for that reason.
4. Understand what volume of goods you can produce. Can you produce the amount of sales being forecast with the equipment,personnel and financial resources available to you?
5. Are your prices realistic?, or conversely, have the prices been set too low or too high so that either way your forecast is potentially unrealistic?
6. If you have just started up in business, your business may take longer than you think to get established, and have you set accordingly realistic sales targets?
7. Have you allowed for the possibility that high sales based on an early promotional surge may drop off, leading to a need for more intensive marketing and higher ongoing costs once opening appeal has peaked?
8. Can you identify and justify the assumptions you have made in getting the forecast, and explain them to interested parties if needed?