10 Aug Is Your Pipeline Enough to Meet Your Goals
We all know that every business and salesman are unique. However, one thing that is consistent in all high-performing companies and sales teams is operational sales process rigor. High amounts of contacts, follow ups, and following a structured process will consistently bring in the results you expect. So, do you have that in place?
Why Are You Not Getting Results?
If you are still not getting results, it is likely because you just don’t have enough pipeline. Data proves that too. Vantage Point Performance and the Sales Management Association revealed that 44% of executives think their organization is ineffective at managing their sales pipeline.
How Can You Ensure that You Have Enough Pipeline?
Start by calculating your pipeline. To do that, you just need a few statistics, and, funny enough, your CRM can calculate these for you. The data that you need to look at to calculate your pipeline is the following:
- Target – What is your quota?
- Average Deal Size (Revenue / # Sales) – What amount should you expect each deal to be?
- Close Ratio (Total number of opps won + lost / won) – What percentage of deals are you closing?
Once you have these numbers, it is just a matter of calculating what you need. Let’s take a look at the example below:
Sample data provides the following:
- Target: $200K
- Avg Deal Size: $10K
- Close Ratio: 10%
From which you can calculate the following:
- # Deals needed to close = Target / Average Deal Size
$200K / $10K = 20
- # Deals needed in pipeline = # Deals needed / Close Ratio
20 / 10% = 200
- Value of opps in pipeline = # Deals needed * Avg Deal Size
200 * $10K = $2M
Sales teams that follow a defined sales process average more than 33% in production and revenue than sales teams that don’t (CSOinsights.com).
It’s natural for people not to like to admit that they are not doing enough. Most people do not have enough in their pipeline to close the period successfully. That is because a pipeline usually requires way more than we normally have already in place. Statistics used are your statistics gathered by analyzing what you’re currently doing. It’s in your best interests to improve them if you are willing to succeed.
Heroes are not born they are made. Preparation and pipeline will make you a hero.