How much business will you close this year? Throw away your crystal ball.  There is a method to take most of the "guestimating" out of your sales forecasting.  To get a better handle on your numbers requires using a structured way to evaluate potential sales so that you can develop the right strategies to meet your goals.

While some companies are feeling uncertain about meeting revenue and earnings projections this year, others are concentrating on positioning themselves to ride out tough times by having a rising order backlog. Increases and decreases in a company's backlog indicate the future direction of sales and earnings for your company.  

No matter the size of your company, a correctly maintained backlog system will provide many benefits to you including getting a better handle on your numbers. A backlog system helps control the quality of tasks to be performed and provides a higher quality of data for future analysis and improvement. Departments such as maintenance are dependent on this information to move beyond being reactive to having control of their parts and services.

Simply said, backlog means the total value of sales orders waiting to be filled.  Some companies have one week of planned work and other, larger firms, have years of backlog scheduled because their projects are huge.  For many construction companies, it is advisable to try to get a 100% capacity in scheduling labor hours for longer than three to five weeks.  By applying controls, accurate processes and role-specific training in these areas, the backlog becomes an efficient tool for reducing waste of labor hours, parts resources and planning time. As you plan for the year ahead, six factors will have the greatest impact on your results:

1. Identify the current market situation
Every year is a different year.   Last year's sales took place in a particular volatile business climate.  This year many companies are faced with a bad economy.  Certain industries are flat and there could be higher competitive activity.  The market place may not allow you to raise or even hold your prices so the value of the average sale may go down. Forecasting sales should be a quarterly event, especially in a down economy.  If your company cannot achieve your planned rate of revenue growth, you may need to: