2021 Industry Sales Forecasting Tips: Reasons for Optimism
Like most large distributorships, we at Boundless spend this time of year preparing a forecast and a budget for the upcoming 12 months. In our case, we forecast based on a fiscal year (April 1, 2021 – March 31, 2022). As we look ahead into 2021, there are many reasons to be optimistic—an effective COVID-19 vaccine is being distributed, the stock market is going up and the government continues to pump money into the system.
That said, there are also reasons to remain cautious. The CDC predicts we won’t hit herd immunity level with vaccination until late 2021, many businesses have decided not to open until the end of summer, and the resumption of in-person events taking place is anyone’s guess.
At Boundless, we have 105 seasoned industry sales professionals who, on average, write over $750,000 in annual sales. We conduct what we call a bottoms-up sales forecast. Without corporate influence, we blindly ask our sales professionals to provide a 12-month sales forecast based on current trends within their customer base and buyer feedback.
In years past, I usually gave our folks a “whoa, Nellie!” expression as they typically forecasted high (I mean, very high). By nature, salespeople are incredibly (maybe overly) optimistic. This year, it was interesting that we came up with a collective forecast of an approximate 10% increase over last year. This is much more conservative than years prior, considering we are following a historically terrible year for the entire industry.
As we dove into individual forecasts, it was interesting to see that the clients who struggled throughout the pandemic were projected to continue to do so. The anticipation of a decline in PPE spend would not be offset by an uptick in traditional promotional spend. I am sure some of this cautious pessimism is reflective of the psychological scars experienced during the pandemic. I mean, who can blame clients after the entire economy was essentially shut down for months in 2020?
From a management perspective, however, we are oddly more optimistic than our sales professionals this year. We are optimistic because there are some real winning industries that have continued to grow despite the pandemic and show no sign of slowing down—automotive, home construction, technology and health care are but a few. We are optimistic because we invested heavily in prospecting resources that our sales professionals have taken advantage of and are now showing results with the addition of new customers and programs. We are optimistic because our sales professionals have stayed in the game while a sizable amount of industry sales professionals have exited the industry, leading to less competition and more opportunity.
So, what does this mean for the 2021 fiscal year forecast? We in management anticipate over double what our sales professionals forecast—hopefully they won’t be coming back to us at the end of the fiscal year and saying “whoa, Nellie!”
Stay strong, stay optimistic, and look to clients who are doing well while cradling those who may need a little more creative assistance in getting back on their feet.
Pat is currently executive vice president of sales at Boundless. Prior to joining Boundless, Pat was vice president of sales for Toppers, a Top 20 industry supplier. Prior to Toppers, he served as vice president of national accounts for Norwood Promotional Products, one of the largest promotional products suppliers in the industry. In his free time, Pat enjoys drinking a cool beverage while attempting to play golf.