SalesCreate a sales forecast template

Create a sales forecast template

A sales forecast document helps you work out the future growth of your business. It’s an important way of understanding which products and services you sell will drive the growth and so plan how best to use your sales team and marketing budget. Sales forecasts can be complex so to make them easier to compile you can create a re-usable template that you update every few months with your latest figures.

A sales forecast is normally based on historical sales data together with market trends and various other factors such as pricing and supply. A well-designed sales forecast template can help you make informed business decisions, set realistic goals, and allocate resources effectively.

What is it important to use a sales forecast?

Successful and growing small businesses use sales forecasts for several reasons. Firstly, it allows a business to anticipate demand and plan production and inventory accordingly. By understanding future sales trends, you can optimize your supply chain and avoid overstocking or understocking products.

Secondly, a sales forecast template provides a basis for financial planning and budgeting. It helps you forecast revenue, determine profit margins, and assess the financial feasibility of new initiatives or investments. By having a clear understanding of future sales, businesses can make informed decisions about resource allocation and investment strategies.

Lastly, a sales forecast template lets you set realistic targets and measure performance. It provides a benchmark against which your actual sales can be compared, allowing for adjustments and improvements in sales strategies. By tracking actual sales against projected sales, businesses can identify areas of improvement and implement corrective measures.

How to calculate projected sales

Calculating projected sales involves a systematic approach that takes into account historical data, market trends, and business-specific factors. Here is a step-by-step guide to help you calculate projected sales accurately:

  1. Gather historical data: Collect sales data from previous periods, ideally spanning several years. This data will serve as the foundation for understanding sales patterns and trends.
  2. Identify market trends: Analyze the market conditions, including industry trends, customer preferences, and competitor activity. This analysis will help you identify potential growth opportunities or threats that may impact sales.
  3. Segment your market: Divide your target market into segments based on relevant criteria, such as demographics, geographic location, or customer behavior. This segmentation will enable you to understand the unique characteristics and needs of each segment.
  4. Estimate market share: Determine your market share within each segment by comparing your sales to the total market size. This will help you gauge your current market position and identify areas for growth.
  5. Calculate sales potential: Based on your market share and the total market size, estimate the sales potential for each segment. This can be done by multiplying the segment’s market size by your market share percentage.
  6. Consider external factors: Take into account external factors that may affect sales, such as changes in the economy, industry regulations, or technological advancements. Adjust your projected sales accordingly to reflect these factors.
  7. Validate and refine: Validate your projected sales by comparing them to industry benchmarks or expert insights. Refine your projections based on feedback and additional market research.

Why Use a Sales Forecast Template?

A free sales forecast template can help simplify the sales forecasting process and save time, allowing you to focus on other critical tasks. Below are the benefits of utilising a sales forecast template:

  • Consistency: A sales forecast template ensures that you follow a consistent format, easing comparing past data and future projections.
  • Accuracy: A well-designed template can help increase forecasting accuracy by prompting you to consider all relevant factors.
  • Efficiency: Templates simplify sales forecasting, reducing the time and effort needed to create accurate projections.
  • Customisation: Many free sales forecasting templates can be easily customised, allowing you to tailor them to your needs.

Key components of a sales forecast template

A well-designed sales forecast template consists of different types of data:

  1. Historical data: This includes past sales figures, market trends, and customer behaviour. Historical data provides the foundation for estimating future sales and identifying patterns or trends that may impact sales performance.
  2. Market analysis: Understanding the market dynamics, such as industry trends, competitor analysis, and customer preferences, is crucial for an accurate sales forecast. Market analysis helps businesses identify potential opportunities and challenges that may affect sales.
  3. Sales goals and targets: Setting clear sales goals and targets is essential for effective sales forecasting. Businesses should define specific objectives and align them with broader strategic goals. These goals can be based on market growth, customer acquisition, or revenue targets.
  4. Assumptions and variables: Sales forecasts often rely on certain assumptions and variables, such as pricing changes, marketing campaigns, or economic factors. It is important to document these assumptions and variables to ensure transparency and facilitate future analysis.
  5. Sales channels: Different sales channels, such as online platforms, retail stores, or distribution networks, may have varying sales patterns and performance. A sales forecast template should account for these different channels and their respective contributions to overall sales.

Creating your sales forecast template

Step 1: Collect Historical Data

Before creating your sales forecast template, you need to gather historical sales data. This data should cover at least the past 12 months, allowing you to identify patterns and trends that will inform your future projections.

Remember that factors like seasonality, promotions, and weather can impact your sales, so try to collect as much information as possible.

Step 2: Observe Past Sales and Growth

Next, analyse your data to identify trends and patterns. Look for periods of sales growth, declines, and other relevant factors that may impact your future sales.

Remember to consider any marketing tools and strategies that were successful in the past, as well as customer and company data that could affect your sales.

Step 3: Identify Key Drivers

Once you’ve analysed your past data, identify the key drivers that affect your sales. These could include changes in consumer behaviour, seasonal trends, competitor activity, and promotional events.

Identifying these drivers will help you make more accurate sales forecasts and better understand the factors that impact your business.

Step 4: Choose a Sales Forecasting Method

There are several sales forecasting methods to choose from, each with its pros and cons. Some common ones include historical growth rates, market research, and sales team input. Choose the application that best works for your business and the data you have.

Step 5: Create Your Sales Forecast Template

Now it’s time to create your sales forecast template. A monthly sales forecast template is ideal for most retail businesses, as it allows you to track short-term trends and adjust your strategy accordingly.

You can use a free sales forecasting template or create your own using spreadsheet software like Excel. Your template should include columns for:

  • Month
  • Sales revenue (predicted)
  • Sales revenue (actual)
  • Difference between predicted and actual

Step 6: Review and Update Regularly

Finally, you must review and update your sales forecast template regularly. By comparing your sales projections with actual sales data, you can improve your forecasting accuracy and make better-informed decisions for your business.

Update your sales forecast template at least once a month to ensure you’re on top of your business’s performance.


How can I improve the accuracy of my sales forecasts?

Ensure you’re using accurate historical data, regularly update your forecasts, and consider using multiple forecasting methods to increase your accuracy.

How far ahead should I forecast sales?

For most retail businesses, a monthly sales forecast is sufficient. However, you may want to create a longer-term forecast for strategic planning and budgeting purposes.

How often should I update my sales forecast template?

Update your sales forecast template at least once a month to ensure you stay on top of your business’s performance and make informed decisions.

Can I use a sales forecast template for different industries?

A sales forecast template can be adapted to various industries by customising the template to fit specific business needs and industry factors.

What are common sales forecasting methods?

Some methods include historical growth rates, market research, and sales team input. Each method has advantages and disadvantages, so choose the one that best suits your business and data.


Creating an effective sales forecast template is vital for businesses to plan, strategize, and make informed decisions. By understanding the importance of sales forecasting, calculating projected sales accurately, and following a step-by-step guide to creating a sales forecast template, businesses can optimize their sales strategies and drive growth.

Remember to consider key components, such as historical data, market analysis, sales goals, and assumptions, when designing your template. Take advantage of tips for effective template creation, avoid common mistakes, and use your sales forecast template as a tool for decision-making.

Leverage tools and resources available to support your sales forecasting efforts, such as spreadsheet software, CRM systems, and business intelligence tools. By doing so, you can enhance the accuracy, reliability, and usefulness of your sales forecast template and pave the way for business success.

Written by

Anna Thornhill
Anna Thornhill
Anna Thornhill is one of our expert writers. Anna is our specialist editor covering business growth and marketing and makes it her mission to provide small business owners with practical guides that help you step-by-step to grow your business. Anna’s an experienced sales and marketing professional who moved to writing and editorial and helps startups and small business owners with practical advice in growing their business with the latest sales and marketing techniques plus guides to choosing and using sales and marketing technology.

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