Distinguishing between Pipelines and Forecasts in Salesforce - dummies

Distinguishing between Pipelines and Forecasts in Salesforce

By Liz Kao, Jon Paz, Matt Kaufman, Tom Wong

What’s the difference between a pipeline and a forecast in Salesforce? Many business users use these two terms interchangeably. They normally both refer to an aspect of your sales organization and process, but in Salesforce, they’re two distinct features.

If you think about a metaphorical sales funnel, you have all your new leads or potential sales at the top (the wide part). As the funnel narrows, so do the more qualified prospects or customers who show real interest in buying. In Salesforce, this idea is manifested in the sales pipeline. It’s the best way to envision the abstract sales process, and it provides a way for sales users to move a prospect through the steps to qualify and close deals. An opportunity is technically in the pipeline until it’s either closed won or closed lost.

Forecasts, on the other hand, are a view into your pipeline. Forecasts help predict sales revenue from the pipeline, based on specific criteria you define. For example, you can choose to incorporate the revenue from ongoing opportunities at certain stages in the pipeline into your forecast so that you can get an estimate of what you’ll be generating this month, quarter, or year.

If you have lots of open opportunities that are basically done deals but can’t technically be closed yet, you might want to include them in your forecast for a more accurate estimate of your revenue. Over time, these estimates can be refined and become increasingly valuable.

In other words, forecasts look at the pipeline to estimate an outcome. Now, the next time a sales manager confuses these two terms, set him straight with these words of wisdom and impress your colleagues with your knowledge.