In a business perspective, a sales analysis report explains the trends that have occurred in the sales that a company is making over a certain period of time. To make it sound simpler, it is a report that shows whether the sales are following an upward or downward path. Managers often bring sales analysis reports into play when they are trying to determine what course of action must be done and how to approach potential opportunities in the market.
The elements of a sales analysis report
Generally, a sales analysis report would include information about actual sales, product demand, estimates, and new vs. repeat business.
- Actual sales take account of what the company was able to make during a specified period and this information is often compared to the projected sales.
- Product demand reveals the consumers’ need for the product or the service offered by the business. If there is a decline in the demand for a specific product, it is the time when companies strategize by rebranding, creating a new purpose for the product or making a whole new product to offer to the target market.
- Estimates are commonly used in some industries in estimating market prices. A very good example is real estate business where market prices are mostly estimates.
- New vs. repeat business is an element which helps managers analyze whether they should retain the business or come up with a new one. This information is also helpful when managers want to know how to move toward new customer groups and measure the efficiency of new marketing campaigns
The purpose of making a sales analysis report
The performance of the sales department can be measured using a sales analysis report. The information that it can provide to managers can help in understanding past performance, forecasting future sales and developing new strategies. The sales department is not the only group that can make good use of such reports. The finance as well as the human resource departments also use these reports to compute the bonus payouts and sales compensation for the employees in the sales department.
Frequency of creating sales analysis report
Depending on the nature of the business, sales analysis reports can be prepared daily, weekly, quarterly, semi-annually or annually. But with the existence of automation tools, businesses can already generate these reports any time they are required.
It is essential to use accurate data when creating sales analysis reports. Otherwise, the results generated would not be able to serve its purpose or, worse, it could cause problems to the business in one way or another.