So where do you start looking for information. You can obtain sales figures for particular types of products for example washing machines, televisions, foodstuffs and even knitting wool!. It is harder to get similar data for services.
If you can get it, even more valuable information is data on sales by particular groups. There is also the increasing accumulation of statistical data on socio-economic groups living in certain neighbourhoods. A great help if you are calculating potential sales in a given area for a local shop.
Data is easier to obtain in the new technological age however it is still the case that the way you use data varies according to the business. For example in siting a shop you can obtain the turnover figures for different types of shops in different locations. You can then make a judgment on the possible turnover in the location you have chosen – taking into account similar shops, the pattern of local transport, and the shopping area. Many years ago when looking to open up a fashion outlet my business partner ,at the time , and I, spent many hours watching the activity at different times of the week in the area we wished to open. This proved invaluable in making our decision not to commence trading.
The changes in the past twenty years has seen out of town shopping areas which has in many cases had an adverse effect on local shopping.
If you are selling your products or services nationwide then you can often obtain information on total sales, your major competition and what chance you have of getting a modest share of the market. Again these might give you an idea of the possible volume of sales you might achieve.
If however your are opening a restaurant, you will need to know how many people eat out and what is the average spend and what types of establishment are the most popular. Finding out information on the local competition is important. Your sales figures are also limited to the restaurants facilities, for example, how many covers you will have available, how much and what hours you propose to use them. Also will your sales be seasonal – is your restaurant in a seaside resort where your target audience may only be available for six months a year.
The information provided so far is selling to the general public however if you are selling products or services to businesses the issues involved can be very different. Will you be selling to local or national businesses? What are their buying patterns?
If you are after large contracts, how large are they and how many are awarded. It is imperative to understand the length of time before proposal and being awarded – this can have a huge effect on forecasting.
Next Article – Business Planning –Sales Forecasting Experience
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