In order to properly forecast sales, you should understand the sales cycle from 2 perspectives:

• how long a sale will take to conclude
• when and how often customers buy.

How long a sale will take to conclude considers each individual transaction and the length of the decision making process for a client.

For smaller purchases which are transactional in nature, the sales cycle or decision making process  might be fairly short.  For larger transactions which are strategic in nature or involve  capital investment, the sales cycle can be protected and may take several years to conclude.
Whatever the case may be, you need to understand this process as it will have an impact on your resources, budget and cash flow.  It will also help you in determining the right level for your sales pipeline and be able to monitor it with an informed view. 

When and how often the customer buys will also impact on resources, budgeting and cash flow. For instance, you may know that most of your sales need to take place in the middle of the year so that orders can be placed in time to ship for the Christmas season. If this is the case, you can have the proper people in place to be selling during this critical period and project when the sales will be closed and revenue is realised. 

Your marketing plan and sales plan also needs to take into account the sales cycle so marketing and sales campaigns can be planned and scheduled accordingly.