The reasons you should build a qualified sales pipeline are…
If your management asks you to check your sales pipeline that means you need to pay attention to the leads you are generating and how qualified they are. Your sales numbers will dip if the sales pipeline is not steady and strong enough to help you reach your sales targets. If you are not generating enough qualified leads and qualifying prospects how can you have sales? You will be advised to build a qualified sales pipeline to be effective in selling.
Each sale starts with a lead: a name, a phone number, an email address, a referral, or the person that just walks into your office or store. The next step is qualifying the leads. To determine whether the customer has the need and capacity to buy your product or service. For instance, a growing small business owner may require a few personal computers in the office to augment increasing business activity. But does your brand of computers meet his business needs? If yes, how many can they afford to buy at this stage, and how many more soon?
The next steps are setting appointments with the prospects and giving a demonstration of your product or service. This could lead to a sale and being taken altogether this is known as the sales process. The first two activities: generating leads and prospecting are known as creating a sales pipeline.
Archery and Sales
The analogy of a sprinkler system best applies to a sales pipeline. When a garden needs to be watered with a sprinkler system there is an elaborate plan. The pipes carrying water are arranged in such a manner that the water flow is steady to all the sprinklers. The game of archery is the perfect analogy for sales. An archer is given many arrows to hit the target. With the given number of arrows, they have to maximize their score. The closer their arrows hit the bull’s eye, the more points they receive. Similarly, a salesperson creates leads, qualifies them as prospects, and tries selling to them. Just as an archer may not hit the bull’s eye every time they aim, the salesperson may not be successful in selling with each call or each prospect. As an archer tries with more than one arrow to hit the target, the salesperson also tries to make a sale with more than one prospect. The game of archery requires the archer to carry all the arrows with them. Salespeople keep trying with many prospects. And prospects come from leads.
Ten or more leads may provide the salesperson with one good prospect. And one in ten such prospects may buy. This is the basic premise of a sales pipeline.
Steady Sales Pipe Line
Though the archer gets many arrows to use, still they are fixed in number. They have to utilize their skills in notching up the best score by hitting the bull’s eye repeatedly at a given point in time. Likewise, a salesperson generates a fixed number of leads during a sales day. For example, a computer salesperson targeting a high-rise building in Manhattan housing 50 offices can have 50-100 leads at the maximum (assuming that in some offices they may get the chance to sell to individual employees in addition to catering to the official requirements of the firms) from that building. Their sales would depend on how they manage the 50-100 leads.
There is no infinite number of leads and prospects. Every market segmented based on location, income, and preferences of the consumers is limited in size. Wisdom lies in utilizing the leads and prospects properly and converting them into sales. Careless exhaustion of the list of leads will only result in spoiling the chances of selling. Each lead has to be dealt with carefully. Each prospect has to be worked on attentively.
While taking each lead and prospect with due attention and sincerity a good performer in sales builds a steady pipeline of leads and prospects. Once a list of leads is exhausted fresh leads will be needed. High performers in sales always have a steady sales pipeline by renewing it with newer leads and prospects. They also include past and current customers in this sales pipeline. Fresh requirements from existing customers are no less important to sales than a new hot prospect.
With the possibility of rejections, the only way a salesperson can achieve their sales quota is to generate the maximum number of leads and qualify the maximum number of prospects out of them and thereby increasing the chances of selling. The generation of qualified leads and prospects should be steady and voluminous. And each lead and prospect should be worked on diligently so that not a single one is wasted. This is the essence of a qualified sales pipeline which holds the key to maximizing sales.
