When customers postpone projects, a fall in turnover shows up first in the orders
27 October 2026, 08:22
A business that works to order invoices today what it sold weeks or months ago. To know what it will have to deliver later on, today's sales are not enough: they have to be compared with new orders. On 26 October Cancom, a German IT services group based in Munich, cut its 2026 sales forecast by €100 million, to between €1.65 billion and €1.75 billion.
In the third quarter the group's turnover fell to about €412 million, against €423.9 million in the same period of 2025. The company attributes the cut to "longer decision cycles and postponed projects", above all in the area the group calls Workplace: the computers and workstations it supplies and manages for businesses. A customer who postpones a project cancels no contract and leaves no unpaid invoices: the order it would have signed in October slips by a few months, or falls through altogether, and meanwhile the supplier keeps invoicing the orders taken earlier.
The order book empties with deliveries and fills with new requests
The order book is the value of orders already accepted from customers and not yet invoiced, that is, what the business has already sold and still has to deliver. It is measured at a given date, like inventories. Each invoice issued reduces it by its amount; each new order increases it by its value.
The comparison between what comes in and what goes out has a name: book-to-bill, the ratio between orders received in a period and turnover in the same months. It is calculated by dividing the first figure by the second. Above 1 the order book grows, because more orders come in than are fulfilled. At 1 it stays as it was. Below 1 it shrinks.
Today's turnover does not show the slowdown
When customers start to postpone, invoices go out as usual for a while, because the business is delivering jobs won earlier. New orders, by contrast, fall straight away, and the ratio drops below 1. The slowdown appears in the invoices only once those jobs have run out: after an interval that depends on delivery times, a few weeks for those who do maintenance, many months for those who build plant.
This is why turnover, read on its own, is a lagging figure. It says how much work has been delivered, not how much remains. A business can close a quarter with sales in line with the year before and already have a leaner half-year ahead.
The typical mistake is counting as an order something that is not one
Offers still under negotiation and framework agreements without quantities or delivery dates are not completed sales. Counted among the orders, they raise the ratio and make an order book look full when it is not. In the same way, a cancelled job is removed from the order book on the day it is cancelled. And the two figures in the ratio are taken over the same period, long enough not to depend on a single large job: a quarter at the very least, better still the last twelve months.
An example. A company that builds painting plants to order has invoiced €22 million over the last twelve months and in the same period has received orders worth €18.7 million. The ratio is 0.85: the order book, that is, what has been sold and not yet invoiced, is worth €3.3 million less than a year earlier.
The figure is in the management software, not in the annual accounts
The order book does not appear in the balance sheet: it is found in the company's management software, in the list of customer orders not yet fulfilled, with the value and expected delivery date of each. From there, at the end of each period, three figures are read: orders received, turnover and the value of the order book. Divided by average monthly turnover, the order book also says how many months of invoices are already covered by orders received.
The ratio is most useful to those who deliver weeks or months after receiving the request. For those who ship within a few days, such as a distributor, the two figures almost coincide and the ratio necessarily stays close to 1: there it says little. For those who work to order, on the other hand, it is the figure to set next to the following year's budget: the sales written there are covered partly by the order book and for the difference by orders that do not yet exist. As long as the ratio stays below 1, this second share grows at every period end.
This article was prompted by a news item published in finanzen.net on 26 October 2026.