Have you designed a sales pipeline for your business yet? Doing so could help make your business more productive and allow you to better find and fix sales issues.
A sales pipeline is a business's individual approach to how it wants to run its sales. It's a step-by-step process that details everything from making contact with a potential customer all the way to making a successful sale. Since every business is different, each company's sales pipeline is unique.
So how do you go about setting up a sales pipeline for your business?
"The best way is first to decide, based on the company's experience, what its ideal pipeline would look like. What types of deals, in which market segments, for what dollar amounts? What duration for each stage of the sales process? And then compare the actual pipeline to that model," said Thomas Oriol, CEO of Sales-Clic, a sales risk management application.
From there, you can see how the way you currently manage sales stacks up against the way you'd like your sales to run. [Customer Loyalty: 5 Tips for Sales Reps ]
Oriol also noted that in some cases you may need multiple sales pipelines. "The main thing to keep in mind is that for sales pipeline analysis to be meaningful, the sales pipeline should reflect the reality of the business. So if you have business lines (e.g., products, channels, territories) with specific sales processes, by all means design and analyze specific sales pipelines for them," Oriol said.
It's also essential that you keep your sales pipeline stable, as constantly adding or removing stages in your sales process will make it more difficult to analyze your sales pipeline, Oriol said.
Once your sales pipeline is designed and in place, it's important to keep track of how your sales are measuring up. Oriol suggested looking at the time that opportunities take to move from one stage of the pipeline to another, and the conversion ratio between the stages. If these metrics don't meet your ideal sales pipeline standards, then you'll know you need to make some changes in how you handle your company's sales.
Sales pipeline analysis can reveal several risks, like optimistic close dates and CRM data quality issues, according to Oriol, but the most obvious and serious risk is stagnation in sales opportunities.
By analyzing your sales pipeline regularly, you can identify and fix these issues in a timely manner. If you do find that your sales opportunities are stagnating, take action and contact your potential clients.
"The best advice is, don't hesitate to recycle your deals when they start stagnating. Call the prospect and ask the question directly: 'I have noticed that we haven't made progress for some time – is there still an opportunity for us there?' That will free up resources for the better opportunities in the pipeline and improve overall sales performance. If the prospect doesn't pick up the phone, send a message to the same effect and recycle the opportunity after a few days without an answer," Oriol said.