Being aware of and managing the amount in your sales pipeline each week, fortnight or month can have the single biggest impact to achieving your sales consistently from month to month and quarter to quarter.
It is an important forecasting tool that all businesses should use even if they don’t have salespeople, as it clearly shows how many sales to expect and when to expect them.
If your not sure what a Sales Pipeline or Funnel is; it is simply a list of all the prospective customers that have indicated some interest in buying your product or service. They will all be at different stages of the sale depending on their interest level and buying cycle and some will drop eventually drop out.
Information such as total sale value, probability of sale and expected close date should also be included to complete the picture.
The term “funnel” is used because you need to continually fill the top with new opportunities to ensure you have an even and consistent flow of closed sales coming out the bottom. The stages can differ from business to business (i.e. can be simpler with fewer stages), depending on how you sell to customers and what the buying cycle is.
It is important to make sure the funnel is always being topped up with new opportunities, that prospects are moving through the stages and sales are being closed. When you need to close some sales quick, it is easy to identify who is the closest to making a decision (thus easiest to close) by looking through prospects in the negotiation or solution evaluation stage.
The sales funnel is a great tool to help you determine if you have enough prospects and to reduce the impact of lost or delayed sales on meeting targets. It’s all in the numbers and that’s why sales is called a ‘numbers game’. To work out how much you need, follow my example:
- Start with your monthly sales target, lets say it is $25,000.
- Work out what the average sales value is, even if it is a rough estimate.
- Determine your sales conversion i.e. of all the first meetings you had or enquiries received how many of those where you successful in ‘converting’ from prospect to customer. e.g. If you received 20 enquiries and made 5 sales, you have a 1 in 4 sales conversion rate.
- So you will need ‘4 times’ the amount of your monthly target in your funnel at any time. If we go back to the example, you will need $100,000 worth of quotes or opportunities.
This sales article was written by Karen Andrews, Director of Shine Sales Solutions, a Sydney based Sales Coach and Sales expert that works with businesses to increase their sales through strategy development, sales coaching and mentoring.
If you liked this article, subscribe to our monthly Sales Success ezine. You will learn...
* Easy ways to increase your sales and grow your business
* Simple strategies to sell yourself, even if your not in sales
* How to generate sales easier and quicker!
Enter your details at the top of the page or click here
Comments
Post has no comments.