This past week I’ve been catching up a client who has made dramatic improvements to their conversion rate.
Originally, when we first met they told me “We have loads of inquiries coming in and our sales people and running to keep up with the quotations, but we are still seeing a drop in our win rate!”
As we reflected on what had made the difference over the last few months, one key step stood out to them. Reducing their “Pipeline Bloat.”
Their salespeople were typically trying to manage a massive pipeline 5-6 times the sales target they were aiming to achieve. This resulted in a huge amount of time and energy being spent just to keep on top of all these sales opportunities.
We identified several root causes creating this problem and their impacts:
- If you and your sales team do not have a clear focus on properly qualifying sales opportunities you can quickly find yourself on a Hamster Wheel churning out quotes for people while previously qualified opportunities in your pipeline get neglected. It is easy to see the time previously spent on closely tracking sales opportunities being lost.
- Without proper follow-up and follow through the quality of information on these opportunities starts dropping significantly and more importantly so does your conversion rate.
- Another issue to exacerbate the problem is that once you neglect your opportunity tracking and follow up work you allow your competitors to get in on your sales opportunities. Often causing you to play catch-up to get back in pole position and often forcing you to try and break the solution or product specification by offering lower pricing which badly impacts your profit margins!
So what can you do? Three things.
- Find your ‘Tipping Point’ this where your peak performance lies, between the number of opportunities you can effectively manage in a pipeline and your ability to convert that business successfully at a very high level. So, remove that bloated pipeline by streamlining out any low potential opportunities.
- Self-discipline. Everyone in the sales team needs to be crystal clear what type of projects are best for your company and product and how to qualify these opportunities early on.
- Prioritise where you should spend your time and let your top 10 ‘must win’ sales opportunities be the focus of your efforts, these are the ones that really count and if you’ve done the hard work up front to create a great solution don’t lose focus on winning them. Chances are if you nail these ones you will exceed target with less work!
So, take action this week and cleanse that pipeline and find new vitality to focus and win the ones that matter!
Check out this short video that highlights the 5 top forecast killers and how to avoid them.