What's a sales Pipeline (aka. prospecting pipeline)?
A business’s success relies upon its ability to generate revenue.
If a business cannot generate revenue, it will not be in business for very long.
The other week I was chatting with a friend of mine who kept asking me how I was closing new business even during this COVID-19 pandemic. And my response was, it’s about listening to the prospect and connecting them with the right resources that they need to solve their biggest challenges right now.
As you’re going through building your business and implementing systems & processes to generate revenue, you must also think about how it can be done in a predictable and consistent manner.These systems and processes are what we call a sales pipeline.
There’s three reasons why I think you should have a sales pipeline. And all of them, drive back to how to create consistent & predictable revenue.
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If you are winging it, or constantly recreating the methods by which you bring in new leads and take them through the sales and delivery process, if you are constantly saying, “No, we’ll just figure it out”, “we’ll work it out as we go”, or simply “winging it”, if you have no clear process and you are sending different messaging and/or varying definitions for the products/services you offer, It becomes extremely challenging to understand what is working and what is not.
Your ability to review and refine the process and do more of what is working to bring that predictable revenue is pretty much non-existent.
The most important reason to have a sales pipeline is so you can create and refine a process that works, and measures what is going to get us better results.
In the book The E-myth by Michael Gerber one of the studies that are mentioned discusses a split test they conducted where a salesperson who wore a blue suit closed 16% more sales than a sales person dressed in a brown suit.
The reason they were able to find this data was because they had a documented process where they could measure one vs. the other with a few variables involved.
If you can build a way to track something you will be able to measure how successful the strategies & processes you are utilizing to get predictable results.
#2 Mitigate Loss
Your sales person is a key person of interest. In that, if that person/employee were to leave what is the risk of losing that predictable sales revenue we talked about earlier?
The fact is, in business not every hire works out. In any business employee turnover is to be expected and these risks should be mitigated.
Most of those employees will part ways under amicable terms, but some may part in not-so great circumstances.
This could mean, they walk away with your entire process, and pipeline.
If this were to happen, your prospecting and sales conversions can literally come to a stand still.
In many instances the owners of the organization may not know where to begin unravelling the prospecting & sales system, and hiring a replacement might still mean taking into consideration time for training and familiarization with proprietary processes/systems which can further delay revenue generation.
However, if you have a documented process, a sales pipeline, that tracks everything from conversations, to phone calls, to text messages and even notes on how each interaction progressed, it becomes much easier for the new person (or the business owner themselves) to continue the prospects down the sales pipeline and relationship building without the prospects feeling the slightest hiccup.
#3 Ability to Scale
The third and final reason I’d like to highlight is the ability to duplicate the system.
If you know what is working well, you could easily double your revenue by duplicating or scaling the system.
You can also easily expand your sales team, because you know what activities work best for your business.
If you have a well defined system to bring in new business and predictable revenue it also becomes much easier to sell your company. When you put together your pitch, you can focus on the fact that you know exactly the kind of revenue your business generates and will also help you project its future worth.
If you have no process to predict the revenue your organization can generate, or would like help with tweaking your prospecting pipeline download our Prospecting Blueprint – ebook.
It is designed to walk you through how we build the prospecting systems for our clients.