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If your monthly sales forecast has ever fallen through the floor at the last minute then this blog post is for you. Use these three sales metrics to identify the deals that might deflate your monthly sales forecast. Take action on these deals to firm-up the close date or remove them from your sales forecast.

No-one cares when a deal moves within a month.

But everyone cares when a deal moves from one month to the next.

And when that happens in the last week of the month of the quarter that’s when they care the most.

(Actually that’s not true. What they care about most is when that move happens on the last day of the month or quarter).

Pardon the French, but when this happens it completely screws your monthly sales forecast.

But here’s the thing. If you can spot deals that might slip then you can take three forms of action. You can:

  • Prioritize at-risk deals to increase the chances of a successful close this month.
  • Adjust your monthly sales forecast to take account of the potential slippage.
  • Investigate deals highlighted by pipeline quality metrics.

Here are three sales metrics that help you do that. You can use these metrics in salesforce to spot deals that might sabotage your monthly sales forecast.

1. Month on month close date changes

There’s a statistically proven way to forecast the weather accurately. Predict that whatever happened yesterday will happen again today. Very often you’ll be right.

It’s the same with opportunities. The fact that a deal slipped last month means it’s more likely than others to slip again this month.

Particularly if that slip happened in the last week of the month.

The number of times the close date has changed is important. But what helps us identify the most at-risk deals is the number of times the close date has moved from one month to another.

Particularly if that move happened late in the month or quarter.

Here’s what that looks like on a dashboard chart and report.

Dashboard table that shows opportunities whose close date has slipped month on month.

Salesforce report that shows the number of times the monthly sales forecast has been impacted by close date changes.

The chart shows opportunities that are due to close this month. These are the deals that are in your monthly sales forecast.

That focus on this month is deliberate. If the opportunity is at an early stage and the close date moves from 3 months out to 4 months, we’re probably not too concerned. It is deals that might let down this month’s sales forecast that we’re most interested in.

A sales manager armed with this information might:

  • Focus on helping the opportunity owner to close the deal this month.
  • Make a call to the prospect or arrange a negotiation meeting.
  • Offer the prospect an additional incentive or discount to close this month.
  • Or any one of a number of other tactics to increase the probability of closing the deal this month.

You might also consider removing it from any month-end sales forecast you communicate to colleagues. Forewarned is forearmed.

Let’s look at another way to show the same information. Here’s the team-view.

Dashboard chart that shows how the monthly sales forecast can be impacted by close date changes at the team level.

The chart and report helps managers identify systemic issues. Do some sales people need support and training in closing out deals? What can we learn from individuals that have low slip rates? Are some products, opportunity types or territories more prone to having deals slip than other?

2. Number of days since last opportunity stage change

This is a powerful sales metrics because it shows deals on which progress is slow. It highlights deals with low velocity.

Let’s say the typical sales cycle is 3 months. Let’s also assume there are four or five opportunity stages for open deals.

Then all other things being equal, the opportunity stage should change every 20 to 30 days.

If an opportunity is due to close this month but the last stage change is well above this figure then it’s a strong warning signal.

dashboard table showing days since last stage change.

Report showing days since last stage change.

The metric is particularly powerful when applied to opportunities that have slipped one or month months.

Dashboard table showing impact on sales forecast of combining close date changes with last stage change.

Now we can really hone-in on at risk opportunities.

3. Total age of the opportunity

Some opportunities seem to live on for ever.

They’re like zombie deals. No-one knows if they’re really alive but they haunt your sales pipeline and over-inflate your monthly sales forecast.

Dashboard chart showing age of open deals.

And it’s amazing how often these deals will have the last day of the month, quarter or year as their close date.

That happens when the sales person hopes the opportunity will close at some unknown point in the future. Leave enough time, and it’s bound to be closed by then.

Why does this happen? It happens because:

  • Sales people are optimists. They often believe a deal has life long after its sell-by date.
  • Pressure from managers on the size of the pipeline. Closing out these deals doesn’t alleviate this pressure. It increases it.
  • Sales people don’t like setting deals to Closed Lost. This standard salesforce Opportunity Stage implies failure. And that doesn’t sit well with most sales people.

Which is all very well but these opportunities have a habit of moving from one month to the next. That habit often raises its head in the last few days of the month.

And we’ve already discussed the impact that has on the monthly sales forecast.

What’s the best way to manage these opportunities? There’s several options:

  • Add an additional opportunity stage. “Not Proceeding” for example. In many cases these zombie opportunities aren’t lost to a competitor. Rather, the customer simply does not go ahead with any purchase.
  • Create a Task to revisit the opportunity. The customer will potentially go ahead at some point in the future. Keep in contact. Check-back regularly. Add them to your marketing nurture program.

Either way, keep a watch for these opportunities. Use the Opportunity Age sales metric to identify deals that have out-stayed their welcome.

How to create these monthly sales forecast metrics

Each of these three sales metrics are based on custom fields on the opportunity. There is already a standard Opportunity Age field but it continues to count the age of the opportunity even after it’s closed. We therefore created a custom age field that stops when the deal is won or lost.

The three fields are updated using the salesforce Process Builder. Whenever an opportunity is edited the process builder updates the metrics. The dashboard charts and reports then simply use these custom fields to give visibility of the monthly sales forecast.

Simply let us know if you’d like a customized demo of how these sales metrics can apply in your business. Or if you’d like our help in creating powerful salesforce dashboards that give visibility of sales performance and the sales pipeline, simply enter your details in the form below.

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