For some, ''selling things'' is the foundation of their self employment. This presents unique challenges to people wanting to explore the feasibility of commerce for their business as it is often not apart of their education specifically. In this article, we are going to look at one of the first and most very important steps: how to forecast sales. This is because establishing commerce usually involves investment - and now we know why it's important...
It's 2019, and this is a year where we see the possibility of an ''instant'' audience. For example, a designer can create a slogan and image, and overnight it can go viral. Haters let it be known, this is just the world we live in. So, in this example, you could also see how an inbox full of requests of how to buy the work is easily enough motivation for the ''starving'' artist to sell the prints. Of course, this is just one example - you could be a bespoke soap maker or a cobbler and still be self-employed - we just wanted to cover off ''selling'' as a topic because which, unlike services you can negotiate, is a different beast. OK, let's start with some basics.
Immediately after starting your business, you want to build customer relationships, work on the product and service, but not fill in spreadsheets and juggle numbers? Unfortunately, you can not ignore it as a self-employed. A sales forecast, or revenue plan, gives you an initial overview to realistically plan your numbers.
With a sales plan, you can see if your goods (or even for those offering services, have your desired hourly pay match your minimum revenue). But where are you supposed to take the numbers from when they do not exist yet, or perhaps you are are just exploring? This is just one of the questions that come from considering your sales forecast, so let’s get started!
Why is sales planning so essential for small business?
When you start up, you may wonder if all of this is really necessary. You already have enough to do in the beginning, you may be very small and most likely just yourself. But if you start without the necessary preparation, you may be wasting time and energy in the longer term. It is an investment alone in understanding your business and spending time tinkering to make it as efficient as possible.
Without the right numbers, planning can quickly get out of hand. With sales planning, you'll learn that you would have to sell about 50 self-made bags a day at the stated price to stay at a break even, and that may not be feasible. So you can intervene directly and refine your concept.
With your sales planning, you have can take on an entirely pragmatic, analytical approach and immediately discover incorrect calculations. It can be a test or exercise of whether your business idea can survive in reality.
It is usually not so obvious if a business concept can work and there is an enormous risk of blindly trying something out. So, at least once, calculate your numbers. Today You will be very grateful towards Tomorrow You for doing these sorts of exercises.