The sales pipeline plays an essential role in any successful company – from the construction industry to turf and garden suppliers. According to a recent Vantage Point study, 72% of sales managers have regular meetings with employees about the pipeline. However, 63% of respondents say their companies are not managing the pipeline effectively because they are not learning or responding adequately to it. While unexpected opportunities arise, there is a direct correlation between effective sales pipeline management and strong revenue growth.
What is a sales pipeline?
The sales pipeline shows a snapshot of where prospects are in the sales process. Bookings pipelines show you how many sales you are expected to make in a week, month, or year and whether your business is meeting its sales budget.
Many companies use spreadsheets to record the pipeline but a tailored CRM system or data analytics tool is a more structured and consolidated way to manage it.
Let’ say you're managing the pipeline in Phocas, this software has a template to create an active pipeline. You gather all of your potential buyers in one project, then use custom fields to note what stage of the pipeline they are in. And as opportunities move down the pipeline, you adjust the appropriate fields so that you can always see exactly where your buyers are in the bookings pipeline and use it as a central point of reference for your team.
Make it a 'lived' booking pipeline
An accurate sales pipeline optimizes business planning and cash flow. It helps you to recognize the possibilities and challenges of your pipeline management and to take action. Therefore, measuring all results as part of your bookings pipeline is essential so you can learn from the successes and failures. By tracking the results of your sales projections, you will be able to accurately measure your close rate and the accuracy of your bookings and volume pipeline for better prediction of future sales trends.
Without a systematic and ‘lived’ bookings pipeline, the overview of all open bookings is not accurate. As a result, priorities aren’t identified, missing excellent sales opportunities.
Keep an eye on the most important figures, such as:
- The number of potential deals in your pipeline
- The average value of these deals
- The average percentage of sales you actually make (conversion rate)
- The average lifetime of booking before closing
An essential part of every step in your bookings pipeline is to prioritize the leads and prospects with the best sales prospects. These characteristics differ across industries but usually the prospect is in control of a budget and has bought from you in the past.
Once you have identified and categorized all leads, you can start addressing customers directly and the accompanying administrative work.
Successful sales teams regularly review the pipeline and the strategies to track all orders taken, optimize processes, and ensure maximum efficiency and success. A technique that works today may not be relevant tomorrow. All processes can be improved and adjusted over time – from the first talk, the frequency of follow-up activities to the offer – until you have found your formula for success.
Take a look at possible bottlenecks or blockages in your pipeline and think about how to remove them. You then test the changes or carry out small “sales experiments” to continuously improve the entire process. If you make these changes step-by-step, your pipeline will soon become a well-oiled sales machine.
Track all orders taken (open and invoiced)
The Phocas sales pipeline feature provides clear visuals of where you are at and you can customize multiple bookings pipelines, and see the value of each deal every step of the way. Phocas allows you to estimate your cash inflows (open and invoiced) and plan and forecast. You can filter and sort sales that are invoiced or open by product or sales rep, save views to find them quickly, and switch between pipelines with just a few clicks. Sales teams with a more accurate view of potential deals are likely to close in the coming months, spot the bottlenecks, and bring the deals to fruition.
Find some time each week to review the sales pipeline. You get an instant overview of the health of your bookings pipeline and your company. As you track the results over time, you will see how changes in the sales process contribute to overall revenue growth.
To learn more about building a case for for data analytics and pipeline management, download this eBook: Treat your data like an asset.