Better sales forecasting drives best-in-class financial performance

• Update annual operating plan
• Drive predictability in operating results.

Provide better guidance:

Sales forecasts are inherently subjective as they incorporate individual sales rep experiences and biases, perception of customer intent, competitor reactions, and more. Finance, however, relies on objective data to make its decisions — whether to drive capital budgeting decisions or provide guidance to the financial markets. Right90 gives the organization a data-driven basis for assessing the quality of the sales forecast. At the same time, Right90 drives visibility into a more complete and timely sales forecast throughout the organization so departments can identify differences and understand what’s driving those differences. For example, Finance would get real-time insight into where the variance lies between the current sales forecast and the revenue plan to assess which areas of the business are on track with the revenue plan or what is driving the variances. Upon understanding the variances and root cause drivers, Finance can update the revenue plan as needed. The Right90 Trust Factor also enables companies to objectively judge the quality of the sales forecast by product, region, customer, or rep. Consequently, Finance can be more confident in the revenue/sales guidance that it provides to the financial markets.

• Reduce risk of write-offs
• Reduce inventory holding costs.

Reduce inventory risk:

A more complete, consistent and timely sales forecast will not only drive more revenue for a company, but it will also reduce inventory risk. By having a better integrated demand forecast, Operations can be more agile and confident in its production/inventory decisions — thereby minimizing risk of stock-outs and reducing risk of inventory write-offs. Studies have shown that companies attaining the highest levels of forecast accuracy (85% or more) outperformed companies with low levels of forecast accuracy (75% or less). Studies have shown that companies with more complete, accurate and timely forecasts achieved:

Source: RBInteractive Research Group

Drive revenue/margin:

Right90 solutions for sales forecasting provide the tools to hold sales reps accountable for providing complete sales forecasts in a timely manner across all products, customers, regions, and reps. As a result, companies get a more complete, consistent and timely sales forecast down to the product mix they expect to sell. Finance can use this real-time visibility into the mix forecast to assess whether margin goals will be met. More importantly, Finance can work to address any potential mix issues earlier in the quarter — whether it’s working with sales to drive a new incentive compensation program to encourage sales of higher margin products, or working with marketing to drive new discounts, or even updating its margin guidance to the board or shareholders.
Right90 also lets companies see the changes in anticipated market demand and quickly diagnose the root cause factors driving those changes. As a consequence, Sales, Marketing and Finance can quickly pinpoint what specific actions are needed to address these changes and drive material impact to near term revenue and margin.