A sales pipeline does nothing more than provide you with an analysis of the demand for your product or service. It’s the management of the pipeline that helps improve close ratios and drive more revenue. In order to properly manage the sales pipeline you need an effective system that can properly display where each opportunity is in the sales cycle. This results in the ability to more accurately predict monthly or quarterly revenue.
To get started a good CRM system will help you identify if a lead is highly qualified or unqualified by asking a few simple questions:
- Do they have a need for my product or service?
- What is their budget?
- Have you identified the decision maker?
- How soon would they need the product or service? (The likely length of the sales cycle)
By answering these questions you can immediately determine if there are some key pieces of information you are missing. Without this knowledge you could spend a lot of time on the phone or writing up proposals for a prospect that is not a qualified opportunity. Lead scoring is critical to make sure your sales team is spending their valuable time on the most qualified opportunities and not chasing tire kickers.
Then comes the sales pipeline management. Sales cycles traditionally have several steps and may takes weeks or months until a decision is made. Managing each stage of the sales cycle is critical to ensuring that you are on top of every new opportunity. This is key to improving your win-loss ratios. You must nurture and care for each qualified opportunity.
CRM software programs are designed to manage the sales process and provide two critical components that impact the efficient management of a sales organization.
First — CRM software demands the implementation of an automated sales process. These are the steps associated with selling your product or service from the minute you talk with a new prospect to the day a decision is made.
Second — analytical reporting and business intelligence. This enables you to see where each sales opportunity is in the sales cycle, enabling you to take a proactive approach and improving your chance of winning the business.
CRM software programs that focus on sales management often include very good sales reporting such as:
- Where the lead was generated from?
- Was it converted to a new sales opportunity?
- Is the opportunity moving through the sales process as anticipated?
- Did we win or lose the sale?
- What was the dollar value of the sale?
Tracking and effectively managing your sales pipeline is essential to the growth of your business. Without a good sales tracking system highly qualified opportunities can simply fall through the cracks causing you to lose business you could have won if you were properly managing your sales pipeline. The good news is that there are many good affordable sales management and sales tracking software systems that automate the entire sales process and help manage the sales pipeline.