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CRM and Sales

Sales budgets: 7 steps for growth

Kerry Leech 9 min read
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Sales budgets are essential to business performance. They outline the total revenue figures a business aims to achieve in a certain period.

Interestingly, despite the pandemic and economic uncertainty, budgets are rising. In fact, a study by Gartner found that 73% of Chief Sales Officers said sales budgets increased in 2022, by an average of 16.9%.

With competitors likely investing more into sales, rivalry could get a little heated. In this blog, we explore how sales budgets support growth and how to set your own.

But first, let’s dive into why you even need one…

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Why you need a sales budget

There are three main reasons businesses need sales budgets to thrive:

#1: To set objectives and monitor performance

When all teams are aware of the exact sales figures and profits it drives everyone towards the same business goals. Plus, clear targets enable businesses to monitor individual’s performance.

With a real-time view, you can even offer sales additional training or feedback on process issues, so you can quickly take action to get things back on track.

#2: Prepare for bad months

Even the most successful businesses have lull periods. Often due to things outside of a business’s control, like seasonal changes and holidays, it’s rare that every month sees huge sales pipelines and wins.

If you know when to expect fluctuations, it can lessen the impact they have on the bottom line. During those lulls, you can encourage teams to take leave or perform maintenance.

Likewise, in high seasons, businesses can preempt needing extra stock or customer support teams.

#3: Better control costs

Obviously, all businesses need to be profitable. So having an overall view of sales costs against predicted sales shows exactly where profit margins are. For example, businesses can tell how much inventory to order and how many employees they need.

Top tip: It’s best to manage sales budgets in one place where you can easily see and be alerted of over expenditure. This can all be tracked in a visual, customizable template, like this one.

The bottom line? Ultimately, this all enables businesses to be more efficient in reaching their goals and maximizing their profit.

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As you might expect, sales budgets have a huge knock-on effect on other areas of a business — operations, logistics, accounts — which is why they’ve got to be accurate. So how do businesses decide on a sales budget?

Let’s take a look…

The secret sauce to calculating your sales budget

There are two key ingredients to setting a sales budget:

1) Historical data – This often holds the key to unlocking trends in customer and market behavior to help you better plan budgets — whether that’s scaling down during lull periods or up to prepare for peaks in demand.

Here’s how: If growth steadily increases year over year, businesses can likely expect that trend to continue. Or, if it saw a significant dip, businesses can assess the factors that caused it and see if losses can be offset by growth in other areas/product lines and markets.

2) Growth expectations – Leveraging historic data allows businesses to spot trends and growth opportunities. Coupled with research into the market, such as statistics into customer behavior changes, businesses can then build an idea of upcoming needs and plan for it.

Here’s how: Businesses that depend on a single product should anticipate sales to decline at some point due to being less popular and prepare to invest in diversity and innovation. They’ll likely spot this trend in the data.

Key documents needed for the sales budget are the income statement, balance sheet, and cash flow statements. Why? Because these help to project the number of units and the amount you expect to sell. Essentially, knowing this helps you to determine how many customers you’ll need to meet your revenue goals.

  • Income statements – Also known as the profit and loss statement, provides an overview of how much revenue a business earns versus the expenses. This tends to be for a monthly or quarterly time period.
  • Balance sheets – This shows the business’s assets and liabilities so things like cash, inventory value, loans, and loan due dates.
  • Cash flow statements – Finally this covers both the historical costs and predicted future costs and sales growth.

With this analysis, businesses can decide where to focus sales budgets — both in terms of the potential revenue and costs worthy of putting aside to support these sales figures.

Now we have what we need, let’s dive into the steps to creating a winning sales budget.

7 steps to create a growth-busting sales budget today

So here, there are 7 basic steps to create a sales budget. Let’s go through each one.

Step 1: Set a timeframe

Sales budgets cover a set period of time to enable focussed planning.

How long this time period spans is entirely up to your business. Some choose to do this by months, quarterly, or annually. And some choose weekly, for example, if a business is highly geared towards seasonal sales like Christmas.

Once you make your choice you can then delve into the historic data for that time period and cross-reference with market predictions to create an accurate sales budget.

Step 2: Talk to customers

Not many businesses do this. But insight from customers is gold dust! Even a handful of friendly clients can share more insight into their future needs and likely spending behavior way before a business sees these changes impact on their sales. For example, are they still enthusiastic about the products and services? Is there a competitor that has piqued their interest and why?

It’s easy to see why a quick conversation with customers can shed light on potential spending habits and directly impact a sales budget.

Step 3: Check out competition

Given many companies have to publicly share revenue data, it’s relatively easy to compare sales performance.

This can provide reassurance. For example, they may have experienced a sales drop-off for the same time period and demonstrated an industry wide issue.

Step 4: Identify market trends

Some things though, are completely out of a business’s control. Like the, ahem, pandemic.

And the knock-on effect can last a while. For example, shipping issues, and higher costs of delivery due to fuel cost increases. This might impact how much profit margin a business takes. Or, it can mean needing to put the price up for the end-customer.

This is not ideal but preempting it makes the difference between a winning sales budget… And one that isn’t achievable.

Step 5: Define sales targets

Once you have formed a picture of exactly how many sales you expect during a time period, this will shape the expected revenue (a.k.a. the sales targets) and costs in the sales budget.

Psst. If you’re not sure where to start you can download a sales budget template, like this one.

Step 6: Create a sales plan

The next step is to create your sales plan. This sets out the objectives, key activities, expenses, and communication channels across all the departments involved in the sales process.

Word of advice: Don’t overlook the communication side. All teams need to regularly be kept updated on changes to predictions as this impacts their activities.

Step 7: Monitor and adjust budgets

The final step is monitoring and adjusting budgets as you go. For instance, if there’s a change in the market, sales volumes aren’t hitting targets, or prices for stock have increased.

Top tip: There are tools out there that make this much easier. Look out for ones that automatically flag when things are over or under budget.

But if you’re really ready to exceed targets and drive business growth in 2023 and beyond, here’s how…

Exceed sales with 

Businesses depend on accurate sales budgets. But once your budget is set, keeping track of costs and sales is what really drives you towards exceeding those sales targets.

With’s sales budget tracker, this is all made super easy with one simple, hyper-visual and customisable dashboard.

Assign expenses to departments, automatically see a flag for a positive or negative budget difference, upload documents, track income and updates, and so much more.

See how it works, right here.

example of a sales budget template on

If you still have unanswered questions, take a look at our FAQs below or chat to our sales team.

Frequently Asked Questions

Here you can find the most commonly asked sales budgets questions to quickly get the answers you need.

What is a sales budget?

A sales budget is a plan for a businesses total revenue goals during a certain time period. It also takes into account the costs associated with delivering those sales volumes, including hiring additional sales team members and staff training.

How to calculate sales budget

There’s a simple calculation for this one: sales budget = sales volume (units) x selling price per unit.

How to prepare a sales budget

There are seven key steps to create a sales budget (more on this in the blog above).

  • Step 1: Set a time frame
  • Step 2: Talk to customers
  • Step 3: Check out the competition
  • Step 4: Identify market trends
  • Step 5: Define sales targets
  • Step 6: Create a sales plan
  • Step 7: Monitor and adjust budgets

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Build your sales budget

Building an accurate sales budget puts businesses on the right path to growth. What it boils down to is this: Sales budgets help businesses track performance and operate as efficiently as possible.

Backed by historic and growth data allows businesses to set realistic goals — considering everything from product maturity through to costs associated with each sale.

If business growth is a goal, you really need a sales budget.

Kerry Leech is a highly experienced B2B Content Marketer with over 20 years' experience within SaaS, Data, and Tech.
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