Are You Ready for the Annual Sales Planning Process?

The Annual planning process begins now for many Sales Leaders.  In preparation, it is a best practice to refine your sales strategy.  Doing so enables you to build a revenue plan to acquire the necessary budget.  This post will help you prepare a world-class revenue plan to secure budget.

Building a revenue plan is difficult without unbiased analysis.  It’s likely your analysis starts by looking at prior year results.  Then adding a percentage.  This will be the lowest percentage you think your boss will approve.  Then there are a few back and forth iterations.

This type of revenue plan is not valuable.  It isn’t based on the true potential within each revenue bucket.  It is just a yearly exercise that doesn’t help you maximize growth opportunities.

You need to understand where organic revenue growth will come from.  Within a revenue plan, there are five main levers.

  1. Cross-sell: sell adjacent offerings to the same buyer or to new buying centers
  2. Up-sell: sell more of the same offering to current customer
  3. New Offerings: launch new products/services into the marketplace
  4. Sell new logos: pursue the prospect universe or new market
  5. Increase prices: ask your customer base to pay more

Are you preparing for the Annual planning process?  Do you have confidence in where revenue is going to come from next year? SBI’s “How to Make Your Number in 2018” Workbook or interactive tool will help you prepare.

The visual below shows five steps to the planning process.  The first three of which involve segmentation. It is important to do all three forms of segmentation before revenue planning. Without the detailed analysis from segmentation, revenue planning will be a guessing game.  The remainder of this post will focus on sales revenue planning.




Sales Revenue Planning

The goal of revenue planning is to define where revenue will come from.  Some best practice components involved in building the plan are:


  1. Pro-Forma Revenue Model – financial model with where the revenue is coming from and when.
  2. KPIs – how will you measure success?  This should be a combination of leading and lagging indicators.
  3. Sales Plan – what levers are you going to pull to make the number? How much will come from each lever?
  4. Risk Assessment and Mitigation – what could keep you from achieving the plan?  Within the risk assessment, there are four main buckets.
    • Execution – is the plan too ambitious? Do we have clear ownership, timelines, and objectives?
    • Operational – this bucket considers disruption, 3rd party reliance, and if the project scope is realistic.
    • Financial – will cost to obtain revenue exceed the uplift?
    • People – do we have the resources and skills to pull this off?

Here are some benefits your peers have realized utilizing this planning approach:

  • Knowing where to put sales resources to make the number
  • It is clear which accounts and buyers sales reps should focus on
  • Budgets are approved before the year begins
  • Selling the right products, to the right customers, at the right time
  • Knowing when and where to add headcount throughout the year
  • Setting quotas using top-down and bottom-up approach, resulting in high attainment

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