Sales Budgeting by MAHSINA, SE, MSi,.

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Universitas Bhayangkara (UBHARA)

SURABAYA

A sales budget is a financial plan

depicting how resources should

best be allocated to achieve the

forecasted sales

SALES BUDGETING

CONCEPT

The purpose of sales budgeting is to plan for

and control the expenditure of resources

(money, material, people and facilities)

necessary to achieve the desired sales

objectives.

PURPOSE OF THE SALES BUDGET

1) A Planning Tool: In order to achieve goals and objective of

the sales department, sales manager must outline essential tasks

to be performed and compute the estimated costs required for

their performance. Sales budgeting therefore, help in profit

planning and provide a guide for action towards achieving the

organizational objectives.

2) An Instrument of Coordination: As we all know selling is

only one of the important functions of marketing. To be effective it

needs support from other elements of the marketing mix. The

process of developing realistic sales budget draws upon

backward and forward linkages of selling with marketing and in

turn brings about necessary integration within the various selling

and marketing functions, and co- ordination between sales,

finance, production and purchase function.

3) A Tool or Control: The sales budget on adoption becomes

the mark against which actual results are compared. For example

look at the following figure:

SALES BUDGETING FACTORS

Marketing Factors

Financial (Working Capital) Factors

Economical Factors

Technical Factors

Company Policies Factors

Residents Growth Factors

State Conditions Factors

Others

MARKETING FACTORS

Market Size (Local, Regional, National,

International)

Competition Conditions (Monopoly,

Oligopoly or Free Market)

Consumers Conditions (Costumer Taste,

Costumer Power Buying, Consumptions

Ending Costumer or Industrial Costumer)

Profitability Comparative

INITIAL

Sales1.000 @ Rp 100 Rp100.000,-

COGS 1.000 @ Rp 80 Rp 80.000,-

Gross Profit Rp 20.000,-

Expenses Rp 15.000,-

Net Profit Rp 5.000,-

Profitability Index = 5.000 = 25%

20.000

Sales1.200 @ Rp 100 Rp120.000,-

COGS 1.000 @ Rp 80 Rp 96.000,-

Gross Profit Rp 24.000,-

Expenses Rp 18.000,-

Net Profit Rp 6.000,-

Profitability Index = 6.000 = 24%

25.000

It means the plan to

increase Working Capital as

the sales increase need to

be re-reviewed

Asli Ketjup Company

Sales Report

Period Year of 2011, 2012, 2013, 2014, 2015

Annual

Quarter Year of

Total

Mean

Asli Ketjup Company

Sales Report

Period Year of 2011, 2012, 2013, 2014, 2015

Mean = Total/ n Year % = Total per Quarter/

Total Annual

Sales Area

Banjarmasin (BJM) : Martapura (MTP)

2 : 1

Average Ketjup

Sweet Ketjup

Salty Ketjup

Sales Distribution for each Product are as follows:

Average Ketjup 50%, Sweet Ketjup 30% and Salty Ketjup

20%

Sales Forecast for 2016

Y = a + bX

= 132 + 10X

2016 = 132 + 10 (5) = 182 bottle

Year of Sales (Y)

Sales Forecast based on Sales Area

(Banjarmasin 2:1 Martapura)

Total

Total

Total

Average Ketjup

Sweet Ketjup

Salty Ketjup

Average Ketjup

Sweet Ketjup

Salty Ketjup

Distribution

Sales Area

per Product

Sales Distribution per Area per

Product per Quarter (Bottle & Sales

Price)

Average Ketjup

Sweet Ketjup

Salty Ketjup

1st Quarter

Sales Amount Forecast for

Banjarmasin !st Quarter

Average Ketjup

Sweet Ketjup

Salty Ketjup

Average Ketjup

Sweet Ketjup

Salty Ketjup

Average Ketjup

Sweet Ketjup

Salty Ketjup

2nd Quarter

3rd Quarter

4th Quarter

Total Quarter I + II + III + IV

Average Ketjup

Sweet Ketjup

Salty Ketjup

Average Ketjup

Sweet Ketjup

Salty Ketjup

Average Ketjup

Sweet Ketjup

Salty Ketjup

Average Ketjup

Sweet Ketjup

Salty Ketjup

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Total Quarter I + II + III + IV

Annual Quarter of

Asli Ketjup Company

Sales Budget

Period of 2016 Per Quarter

Sales Area and

Type of

Product

Average Ketjup

Sweet Ketjup

Salty Ketjup

Average Ketjup

Sweet Ketjup

Salty Ketjup