How to calculate projected sales

To calculate projected sales, follow these steps:

• Determine how much revenue you want to project. This should include a specific period and a dollar value in revenue.

• Approximate units sold. Next, you must estimate how many units of your product or service you expect to sell within the specific period. You should try to get precise, and if possible, exact figures from your sales department.

  If you can not get exact figures, you can use averages from the units you have sold in previous times, such as months or weeks.

• Estimate cost of unit and sales price. You then must determine how much it will cost to produce each sales unit. These can be manufacturing costs or other costs associated with unit production.

  Then determine what sales price can be placed on each unit. If this information is not readily available, you should consult with the accounting department or other relevant departments.

• Multiplication step. Next, multiply your estimated units sold for the projection period by the price per unit, and then multiply that figure by the number of months your projected revenue will cover. This sum is the projected revenue you can expect for your product or service sales during this time.

• Annual projections. When projecting how many units of a product or service will be sold over an entire year, you must add all of your monthly projections, then take the total and multiply that figure by 12 to get an annual sales projection.

  You can also use this formula for smaller time increments, such as business quarters or weeks.