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Published September 12th, 2017 by

Draw the Line While Forecasting Enterprise Sales and SMB Sales

Sales and forecasting go hand and hand, without critical analyses and revenue anticipation, you cannot take credible decisions.  Good understanding of a business is the base of forecasting, especially when you are approaching enterprises of different sizes. Large scale firms are old giants surrounded with lots of information that makes sales forecasting an easy game. However, the level of difficulty rises when you are foreseeing the sales opportunities in dealing with a startup or medium scale enterprise. Well, though the big giant looks lucrative they have many risk factors attached to it, on the other hand, the SMBS are looking out for opportunities for growth so that they will be interested in your offering, but they also price sensitive.

Be it an SMB or a large-scale enterprise, both have drawbacks and are different in their way, but when looked through an optimistic view, there is even space for profit. While developing sales strategies, we tend to create a standard plan to deal with both the beast, but due to their different complications, they need to be dealt differently while forecasting. Below are few factors that need your attention while forecasting.

Reflect on the historical data

The past information can give a clear picture of the future business revenue, and this helps best while predicting the sales of large scales enterprises as they have a lot of data at reach. A Huge volume of data renders more information about the company that ultimately leads to forecasting accuracy. Through this data, you can get valuable metrics that can aid in strategizing your sales approach. However, this doesn’t work well in the case of SMB as their industrial presence is comparatively less from the large-scale enterprises. So, it is tough to gather enough information for in-depth analysis. Dealing with a company with less data is difficult. More information leads to meaningful prediction and better customer relationship.

Shorter sales cycle

Complexities increase in forecasting when the sales cycle is long, and this majorly happens in the case of large scale enterprises. Many people from the organization are involved while dealing with a big giant. Too many brains have different opinions, this consumes much time and extends the life of the sales cycle. It isn’t even sure if the deal will successfully close and exit the sales pipeline. There are possibilities that it might quit at any stage of the sales pipeline even at the last minute when it is too near to the closing stage. The long-time span and the complexities involved makes it difficult to forecast the revenue accurately. On the other hand, in the case of SMB’s, the sales cycle is usually shorter and simpler. They need the solution, so they tend to take quicker actions compared to the large-scale enterprises. The less complexities support the forecasting and aids in taking better decisions.

Deal forecasting at each stage

Due to short sales cycle and quick response, it is easy to predict sales while dealing with small and medium sized companies. In SMB’s you usually don’t have to speak to many people from their company. There are fewer people involved while taking the purchasing decision and most of the time it is the proprietor of the company itself who directly interacts and signs the contract. So, it becomes easy to supervise the conversion rate at each stage of the pipeline and strategize your next plan of action. The scenario is very different while dealing with large scale enterprises, with lots of people involved the pace of the deal to move in the pipeline is very slow, so it becomes tough to predict the sales.

The final words

SMB’s need a unique approach as their primary concern is profit. They have less experience and expectations compared to large scale enterprises. However, they are ready to spend to survive in the industry while large scale enterprises are worried about their image and growth, they endeavor to position their company. Both have different priorities and procedure so to forecast their sales you need to understand their individual needs. You need to study their spending capacities and requirements for accurate sales forecasting

“You don’t close a sale; you open a relationship if you want to build a long-term, successful enterprise”-Patricia Fripp

Be it an SMB or a large-scale enterprise both are a valuable source of income, so both need your attention. Losing anyone can affect your business growth. Understanding the difference and creating a good forecasting module will aid in successfully catering both the areas and augment your profit margin.

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