What is a sales budget?

The sales budget is a type of budget It is presented as a document that details the profitability of a completed company and the volume of sales it has had during a certain period.

The sales budget is included within the financial plan of any company. This means that the financial plan is made up of the sales budget along with other documents or estimates. However, it is also usually presented within the company's business plan.

This document makes estimates about the sales levels that a company has (and the income they generate). In this way, business decisions can be made from this document as it has a direct influence on production.

Having a good budget and arguing with obvious reasons for the accounts that are in a sales budget, can help the company to obtain better results and, therefore, achieve its objectives.

Characteristics of a sales budget

Before listing the different characteristics of a sales budget, it is necessary to indicate that to prepare it it is necessary that we know the participation that our company has in the market. This can be known with the passage of time, effort, a great knowledge of the market and, above all, experience. Making mistakes, going back and realizing is what will allow us to improve our budget.

The basic characteristics that compose it are:

  • The budget must relate the products or services that the company has and markets.
  • The sales budget must estimate a certain amount of sales both for the sector and for its participation (that is, for the company).
  • Estimates or forecasted sales must be estimated or evaluated in quantity (units and economic values).

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