What this covers
- Why the close date lies
- Weighting by stage, using your own history
- The three numbers to report
- Forecast accuracy is a metric too
Why the close date lies
Ask most construction & contracting teams for a forecast and you get a filtered list: every open project with a close date this quarter, totalled. The number is precise and almost always wrong, because a close date is a statement of intention rather than evidence.
Estimating is expensive. Knowing your tender win rate tells you which bids are worth preparing.
The information that actually predicts an outcome is not the date. It is the stage, how long the project has been sitting in it, and what proportion of projects historically clear that stage.
Weighting by stage, using your own history
A defensible forecast weights each project by the historical conversion rate of the stage it currently occupies. If Site Survey converts at 46% for you, a project sitting there counts as 46% of its value — not 100% because someone typed an optimistic date.
The weights must come from your own history, not an industry benchmark. Two construction & contracting businesses with different contact mixes will have genuinely different curves, and borrowing someone else's produces a number that is confidently wrong.
- Full pipeline: every open project, unweighted
- Weighted pipeline: each stage discounted by its own conversion rate
- Committed: projects past Tender with a named next step
The three numbers to report
Report all three and the conversation changes. Full pipeline shows capacity, weighted shows the realistic expectation, and committed shows what you would defend in front of a board. Reporting only the first is how teams end a quarter surprised.
The pipeline itself has to carry the right stages first. A generic five-stage funnel cannot represent Site Survey, so weighting it produces arithmetic applied to the wrong categories.
Forecast accuracy is a metric too
Track how far each month's forecast landed from actual collected revenue. Most teams never measure this, so nobody learns whether the forecast is systematically optimistic — and it usually is, by a consistent margin you could simply correct for.
Measure against collected revenue rather than closed-won. In construction & contracting the gap between booking and payment is often material, and a forecast that stops at close is answering a different question from the one finance is asking.