The form of the Sales Pipeline tells a story – The Snifter Beer Glass
One of the easiest analysis is to assess the form of the Sales Pipeline. Easy but very informative. The form can show the current commercial capability and performance of that sales person. Or on an aggregated level – the commercial capability and performance of that company.
Focus The Snifter Beer Glass
The form of the pipeline is wide at the top and the middle but much small(er) from in the last stages. In commercial terms this means two things:
1. The company is converting leads into proposals
The good news is that the company is able to create opportunities and to convert them into proposals. How do you create effective proposals?
First and foremost, it should be tailored to your specific customer. Be aware that the proposal will be circulated internally at your prospect. So include the information that was already discussed during the previous interactions. There are at least 7 common features of a winning sales proposal:
1. Executive summary: Start with a summary and address their challenges and why not overcoming it would be detrimental to the business. Do also refer to the prospect’s KPIs and metrics. Articulate how your solution will help them achieve their KPIs.
2. Company Information: Add your company information to create trust and visibility.
3. Solution presentation: Present your solution including the uniqueness or the differentiators.
4. Product Deliverables and pricing table: Provide an overview of the concrete deliverables and the pricing structure. Some proposals offer different pricing options.
5. Customer benefits: Preferably, you display the quantified benefits for your prospects.
6. Customer testimonials or referrals: Include customer references to increase your credibility and lower the purchase risk of your prospect.
7. Sales contract with the terms and conditions: Make it easy for the prospect to sign the proposal. One way of doing this is to make your proposal a contract including the relevant terms and conditions. Your proposal will not only drive negotiation and the steps moving forward but will ultimately become the deal’s contractual agreement.
2. But the proposals are not converting
The form of the Snifter Beer Glass is showing a low proposal conversion rate. What could be the reason?
There are several reasons for this form of the sales pipeline:
- The customer is not ready yet to make a decision.
- The customer pain is not important or not urgent enough.
- The Business Case for the solution is not good enough (e.g. the value is too low and/or the costs are too high).
- The sales professional has lost control over the process.
- The sales professional is talking to the wrong person(s).
Sales professionals with this profile typically:
- Are great in contacting new prospects and have multiple conversations and company meetings.
- Score lower on process management and controlling the prospect.
- Might lack sufficient analytical skills and good customer understanding to qualify the opportunity.
Companies with this profile have a high score on business development and lead generation. But have a lower score on sales effectiveness and/or probably have less competitive advantages or are not able to show this sufficiently.