the sales pipeline is key to increasing sales
How to better manage your Sales Pipeline
The Sales pipeline is one of the most important tools for a Sales person or Sales Leader. It is the only real way that you get a long term view of what your numbers are likely to be. More importantly, if there is a gap between the numbers in your pipeline and your budget, you can take proactive action to remedy this.
There are only two ways that you can influence your pipeline:
- Put more deals into the top of the funnel, or
- Increase your win rate
In order to increase the number of deals, you need to know both your opportunity to win conversion ratio and your lead to opportunity conversion ratio.
For example, if your total pipeline value is £15m and you have an annual target of £10m, you might think you have got it covered. However, if your opportunity to win rate is 40% the the true value of your pipeline is actually £6m, so you have a £4m gap.
Now is the time to work closely with Marketing to understand how they can help. If your lead to opportunity ratio is 10%, then Marketing needs to create a marketing plan to deliver £100m worth of new leads.
The other option you have is to bridge the gap by improving your opportunity to win ratio.
In order to deliver £10m from a total pipeline of £15m, your win rate would have to increase from 40% to 67%. But how do you do this?
There is no easy answer. It requires a detailed analysis of your Sales Pipeline. In order to improve the overall win ratio, you need to look at the ratios along each stage of the pipeline (assuming of course, that your Sales Pipeline mirrors your actual sales process).
It may be that one of your biggest issues is successfully moving opportunities from the “proposal” stage to the next one e.g. this ratio might only be 20%. If you can understand what is driving this poor conversion ratio, you can do something about it.
By analysing and optimising each step along the pipeline, you can make dramatic improvements on the overall opportunity to win rate and deliver more sales.
Shoodan has vast experience in setting up and managing pipelines; they are the lifeblood of the sales machine and we know that if one of the stages of the sales process is in trouble, it will affect all of the others. We can come in and help you set up a Sales Pipeline, give you a handle on the metrics of your pipeline, communicate it to your teams, and show you how to manage your pipeline moving forward, so you get the best results.
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