How To Create A Sales Pipeline For Your Small Business
How to Create a Sales Pipeline for Your Small Business
Every time a customer buys your product or service, they have gone through a sales process. A sales pipeline is a visual representation of this process. It can be used to show you where potential customers are in the sales journey. This has several benefits:
- It helps you to predict incoming revenue.
- Save time managing prospects.
- Show you the next steps to take with prospects.
- Highlights which parts of your process are effective, and which could be improved.
If you are already in business, creating an accurate sales pipeline should be fairly easy as you will already have a good idea about the sales journey your clients take. If you are just getting started, you’ll have to make some guesses. Of course, your pipeline can be adjusted in the future.
The rest of this article will show you how to create a sales pipeline for your small business.
Step 1: Define the Stages of Your Sales Process
You first need to identify the stages of your sales process. To do this, look at sales you have made in the past and work out how the customer went from being a prospect, to a lead, to a customer.
What your customer is doing at each stage of this process will depend on your marketing strategy. For example, you could target prospects through cold calling, Facebook ads, or your SEO strategy. Likewise, you could convert leads to customers through emails, landing pages, or in-person meetings. You may also use different strategies for different types of customer. Be sure to include this.
Step 2: Highlight the Actions Required to Move People to the Next Stage
Once you have a good idea of the sales journey your customers take, you can specify the actions that move people from one section to the next.
For example, if you have been contacting a potential client via email, your sales pipeline may tell you that the next action to take with this prospect is reaching out to set up a call. Your sales pipeline makes it simple to see what you need to do next to make sales.
Step 3: Analyse Your Success Rate
In order to make accurate estimates of sales, you need to know how likely it is that a customer will move between each stage of your pipeline. The best way to do this is to analyze the movement of clients over a period of time. The longer you can do this for, the more accurate your estimate will be.
For example, you may find that out of every 10 people you target with a Facebook ad, five sign up for your email list, two accept a free trial, and one becomes a customer. Using this ratio, you can estimate that if you target 100 people, and your product costs $100, you will bring in around $1,000.
Once you know your success rate, you can also use this number to define what you need to do to hit your targets. Using the figures from the above example, if you have a $5,000 target, you’ll need to show ads to about 500 prospects.
Step 4: Maintain Your Pipeline
The final step is to maintain your pipeline. As your process improves, you may find that that your sales ratio increases. This will need to be reflected in your sales pipeline.
Likewise, you need to keep an eye out for dead prospects. You may have 500 people on your email list—giving an estimated income of around $10,000. However, if many of these prospects are old and aren’t reading your emails, this is unlikely to be an accurate estimate of your potential earnings.
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