7.3 Quotas and Forecast Reporting

Three numbers that answer different questions

A quota is a sales goal for a rep. A forecast is the sales you expect in a period, calculated from transactions and then optionally overwritten. Probability is the percent chance that one opportunity or one estimate will close. A rep can be ahead of a quota and still show a forecast built from deals that are unlikely to close.

Projected amount, expected close, and the weighted amount

The projected amount is the full value of the deal before probability. On an opportunity the field is Projected Total. NetSuite fills it from what is already on the deal. With no items and no included estimates, the rep types the amount. With items and no included estimate, the item total is the projected total. One estimate marked to include in the forecast supplies its own total. Several included estimates are added together. On a standalone estimate, the projected amount is the estimate total.

The expected close date is when the rep expects the deal to close. Reports place the deal in that month, or in that quarter when forecasts are kept by quarter. Changing the date in the forecast editor moves the deal into another period. It does not change the quota of either period.

Probability on the opportunity or estimate belongs to that deal. It is not the probability stored on the customer status. Closed won sets the opportunity probability to 100 percent. Closed lost sets it to 0 percent. Those percents stay on the opportunity and do not rewrite the prospect's relationship status.

The weighted amount is the projected amount multiplied by the probability. A Harbor & Pine showroom opportunity has a projected amount of $10,000 and a probability of 40 percent. The weighted amount is $4,000, because 10,000 times 0.40 equals 4,000. The opportunity shows that figure as the weighted total. Forty percent is not added to $10,000, and it does not replace $10,000. The full $10,000 remains the projected amount. $4,000 is the weighted amount.

With Calculate Forecasts as Weighted checked, the remodel contributes $4,000. A projected view of the same deal remains $10,000. Forecast by Customer Summary can show both figures.

Estimate and opportunity fields

Prepare an estimate at Opportunities > Transactions > Estimates > New. Estimates are non-posting. These fields affect the forecast:

• Probability, the percent that weights the estimate total when weighting is on.
• Expected close, which places the estimate in a forecast period.
• Include In Forecast. Check it when this estimate should feed the forecast. The box appears only if probability exceeds the minimum forecast probability on Sales Preferences. That minimum exists only when Advanced Forecasting is not enabled.
• Forecast type, when Advanced Forecasting is on, which chooses the category.
• The estimate total, which is the projected amount.
• Expires, this quote's own end date. The company default is still Default Estimate Expiration (in days) from section 7.1. Changing Expires does not change the weighted amount.

Use Estimates in Forecast, on the Forecasts subtab, includes estimates in forecast reports, snapshots, and key performance indicators. An estimate left clear, or already converted to a sales order, invoice, or cash sale, is not counted again as an open estimate.

An opportunity also carries Projected Total, the weighted total, expected close, probability, and, when Advanced Forecasting is on, a forecast type. Multiple Projected Amounts, which requires that feature, allows a low amount at or below Projected Total and a high amount at or above it.

The Forecasts subtab

Open Setup > Sales > Preferences > Sales Preferences and click the Forecasts subtab. Help also gives the path Setup > Sales & Marketing Automation > Sales Preferences. These are the preferences there:

• Calculate Forecasts as Weighted. Forecast totals use probability times projected amount.
• Forecast Quarterly (vs. Monthly). Quotas and forecast edits then use quarters instead of months.
• Minimum Forecast Probability, only when Advanced Forecasting is not enabled.
• Use Estimates in Forecast.
• Allow Setting Status in Forecast Editor.
• Allow Setting Probability in Forecast Editor.
• Forecast Accuracy (Weekly View). Pick the weekday and time used to compare a saved forecast with sales.

Advanced Forecasting is not one of those checkboxes. It is an Enable Feature. Go to Setup > Company > Enable Features, open the CRM subtab, and in the Sales section check Advanced Forecasting, then save. The feature adds worst case, most likely, and upside categories. Rename them with Low Forecast Name, Medium Forecast Name, and High Forecast Name. Use low for deals most likely to close, medium for likely but uncertain deals, and high for early or unlikely deals. High is the upside category, not the surest deal. Default Forecast Type sets the starting category. Multiple Projected Amounts, on this same subtab, also requires the feature.

With Advanced Forecasting on, those categories replace the single Minimum Forecast Probability cutoff. Forecasting Help does not list a Use Opportunities in Forecast box, or a box that overrides quotas, on this subtab. Quotas stay on the quota page.

How a quota is set and assigned

Set quotas at Forecast > Setup > Establish Quotas. A quota can be tracked by item, class, location, or department. Location quotas require the Locations feature. In NetSuite OneWorld, each quota is based on a subsidiary, and sales for that subsidiary and its children count toward it.

The employee needs the Sales Rep box, or the name is missing from the quota list. The quota is a target taken from the company sales goal. Changing a deal's probability changes the weighted forecast and leaves the quota in place.

Calculated amounts and overwrites

The calculated forecast adds cash sales and invoices closed in the period, unbilled sales orders, estimates included in the forecast and not yet converted, and opportunities that have no included estimate. With Advanced Forecasting, forecast-by-customer reporting uses the medium, or most likely, category.

Open Forecast > Setup > Edit Sales Rep Forecast and read the quota, the Calculated amount, and the Override amount. In OneWorld, save one forecast per rep per subsidiary. Change the override when reports should show a different number. Restore Calculated copies the calculated amount back. On the Opportunities and Estimates subtabs, change expected close, projected amount, and forecast type. Probability edits require Allow Setting Probability in Forecast Editor. Status edits require Allow Setting Status in Forecast Editor. With Team Selling, a rep edits only transactions where that rep is primary.

New opportunities enter the rep forecast automatically. They enter the manager forecast only after the rep saves, which keeps tentative deals out until then.

What a manager overwrites

A manager can override one rep or the whole team. The team total is the sum of the reps' overrides. An override on a rep shows on that rep's reports. A team-only override does not. Use it for a deal not entered yet, or when past forecasts ran high or low. It does not change the quota. Saved manager forecasts open from Forecast > Setup > Edit Manager Forecast.

Transactions > Quota/Forecast > Edit Sales Rep Forecast opens the same editor. Create the quota at Establish Quotas, and overwrite the prediction in the forecast editor.

Quota, forecast, and probability

When Calculate Forecasts as Weighted is checked, use the weighted amount in the forecast total. When the question is whether the rep beat a goal, use the quota. Practice that split on the Oracle NetSuite Foundation practice questions.