Why You Forecast Sales Using The Expected Revenue Metric

This guide provides practical advice on using Expected Revenue to improve sales forecasting, pipeline coverage, and target tracking in Salesforce.

It explains how Expected Revenue combines won revenue with the weighted value of open opportunities to provide a more realistic view of whether your team is on track to achieve its sales targets.

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Why This Matters

Sales forecasts need to be reliable enough to support decisions and withstand scrutiny from sales leadership and the board. Simply looking at the total value of your pipeline can create a misleading picture because not every opportunity has the same likelihood of closing. Expected Revenue provides a more useful view by accounting for both deals already won and the probability of winning open opportunities.

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Key Insights

• Expected Revenue combines won revenue and weighted pipeline: Expected Revenue includes Closed Won opportunities at 100% of their value, plus the weighted value of open opportunities. This makes it particularly useful for assessing performance against a current sales target.
• Expected Revenue is different from Weighted Pipeline: Weighted Pipeline only considers open opportunities, whereas Expected Revenue also includes revenue already secured from Closed Won deals.
• Opportunity probability directly affects forecast accuracy: Salesforce probabilities are linked to Opportunity Stage, but the default percentage may not reflect the real circumstances of an individual deal. Salespeople should adjust probabilities when customer intent, competitive pressure, deal history, or other factors justify doing so.
• Pipeline size alone does not tell you whether you will hit target: A large pipeline can still produce a relatively small Expected Revenue figure if opportunities have low probabilities. Managers should therefore consider both pipeline size and pipeline quality.
• Expected Revenue helps identify forecast gaps early: Comparing Expected Revenue with the sales target provides a clear view of potential shortfalls. This allows managers to identify where additional pipeline, deal support, or corrective action is needed before the end of the period.

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How To Apply This

1. Calculate Expected Revenue against target.
   Combine Closed Won revenue with the weighted value of open opportunities to establish the expected outcome for the current period.
2. Review opportunity probabilities.
   During pipeline reviews, check that probabilities reflect the actual likelihood of winning each significant opportunity rather than relying blindly on the default probability associated with the Opportunity Stage.
3. Focus on pipeline quality.
   Remove stale or unrealistic opportunities and investigate high-value deals where the Stage, probability, customer buying signals, and expected Close Date do not appear to align.
4. Identify forecast gaps early.
   Compare Expected Revenue with the sales target and use the resulting variance to determine which salespeople, deals, or future pipeline require attention.
5. Use Expected Revenue for target tracking.
   Apply the same approach across individual salespeople, teams, regions, and the company to understand whether the organisation has sufficient pipeline coverage to achieve its targets.

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Read The Full Article

For a deeper dive, including examples and detailed guidance, read the full blog:

The #1 Salesforce Pipeline Report to Use This Year

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Related Guidance

• How To Create Reliable Sales Forecasts in Salesforce with Zero Effort
• Salesforce Forecast Categories | What They Mean and How to Use Them
• 3 Pipeline Quality Metrics in Salesforce That Point Towards Unreliable Revenue Forecasts
• How To Measure Sales Pipeline Coverage With Confidence

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