Three strategies to increase your closing ratios
With the first quarter of 2020 already “in the books,” you and your team should have a good idea of your year-to-date revenue pacing, what’s currently in your sales pipeline and what has a realistic likelihood of closing.
All sales teams are unique but every team leader in every industry, we believe, should be wondering: What can we do to improve and how can we increase our current closing ratios and margins? Well-run sales organizations, and top producing sellers, regularly employ three proven strategies that allow them to maintain their competitive edge:
• Take a closer look at what opportunities qualify to enter your sales pipeline. If your team has no common standard for what, exactly, constitutes a “qualified prospect,” that means different people have different ideas of what is (and isn’t) “real.” This condition causes countless sales teams to underperform and, as the leader, your mandate is to make sure your team is not one of them. Only project income from opportunities where it’s clear that the buyer believes you have a solution to a pressing problem, an appropriate budget to solve that problem, and a viable, mutually agreed-upon decision-making process in place to determine whether the deal will (or will not) move forward. Once you have this set of standards in place, you and your team will have a better sense of which opportunities are worth your time and energy—and which aren’t.
• Clean out and/or move what’s already in the pipeline. An opportunity that enters the pipeline as a qualified lead doesn’t mean it stays qualified forever. Many salespeople are adept at coming up with justifications for leaving inactive leads in the pipeline, which only skews projections and slows down the process of replacing dead leads with live ones. If a prospect has been in the pipeline for longer than your average closing cycle and will not commit to definitive next steps, assume the lead is no longer qualified and remove it from the pipeline. If it’s really moving forward, the buyer will be amenable to setting up a clear, time-driven, decision timeline for a “yes” or “no” answer. Until that happens, the salesperson is responsible for replacing this unqualified lead with a qualified opportunity. Remember: Closing those prospects who have a pressing business problem we can solve, and have the money to pay for the solution, and are willing to share their decision-making process with us, is how professional selling is conducted.
• Avoid discounting and impending events to close business. These tactics erode your margins and send not-so-subtle signals of desperation that are the exact opposite of what a true sales professional communicates. What’s worse, both tactics tell the members of your sales team that what they’re selling isn’t really worth what you’re charging. There is nothing wrong with creating urgency in the sales discussion, of course. But the proper way to do so is to identify the personal, and organizational, pain connected with letting a pressing problem go unsolved, attach a real-world cost to inaction on the buyer’s part and finally, figure out the timeline for change to which the buyer is willing to commit.
Now is a great time to make major positive changes in your selling, and qualification, process. Take the time to review opportunities that currently reside in your pipeline and implement these three strategies consistently, starting this month. You’ll likely find that, at the end of the year, your team’s closing percentages will reflect the positive changes you and your team have made. ♦
Jim Marshall is owner and president of Sandler Training of Tampa Bay which provides sales, corporate and management training to high-achieving companies and individuals. Contact him at 813.287.1500 or [email protected]