Basic Concepts: Sales Cycle Stages Definition
Every person working with sales will eventually (and probably sooner rather than later) come to the understanding that it’s not possible to fully have control over the results you’ll get. What you can do, however, is control closely every activity you get involved with, consequently improving the results you get based on your effort.
Waste, productivity and value:
That is an obvious way of thinking, and it’s fairly easy to apply to you routine if you work on your own.
Working as a team, however, requires the assumption of a few ground rules to ensure the activities you require people to do, or is required to do, are actually going to offer something in return rather than just waste everyone’s time (we already talked about waste here and here, and how it almost always affects your productivity and your customer’s perception of value).
Having a lot of people with their hands full all the time and seeing no positive impact in your results in return may mean people are not actually being delegated the right tasks for them. To work well with a sales purpose, a team must be on the same page regarding their sales cycle.
The sales cycle and how it works:
As an example, look at the fact that your company has as an established best practice to make initial contact with the customer in order to scan for interest – a logical next step on your sales cycle would be to then identify your customer’s needs, cross reference them with the products you can offer and them send them a proposal.
It would be rather counterproductive to have your whole sales team sending hundreds of proposals at random without first identifying the right prospects and their needs.
Managing your sales cycle and its stages is all about looking at the best way possible to order your sales processes and then establishing it as a pattern, with reports to be made and goals to be achieved at each stage.
The sales cycle, its stages and your results:
As said before, determining your sales cycle stages is crucial for knowing when people within your company should be taking what steps. It’s logical, though, to affirm that setting the right sales cycle stages within your sales pipeline gives you more control over your sales results.
Working with a sales pipeline model boosts your productivity by establishing logical, simple and pre-determined steps for a process and will help you not only define the best processes for your specific situation but also help you measure your results.
With the aid of a sales pipeline, then, it’s much easier to manage key activities within key stages of your sales cycle, therefore ensuring your team will know what to focus on in order to achieve the best results.
Let’s take as an example Pipefy’s Sales Pipeline Template, in which there are 5 key stages (Prospect, Qualify, Send Proposal, Under Negotiation and Won/Lost) through which your team has to go in order to follow the whole sales cycle.
In time, all of Pipefy’s Templates are customizable, so you can modify and adapt them to your team/company’s needs, adding or removing phases, changing their names and information inputted on each phase, etc.
A typical sales cycle, with its respective phases on our sales pipeline template, looks like this:
- Target: those would be the customers not yet contacted, but on the line to be contacted – on the Sales Pipeline, these customers would be on a backlog, before they properly entered the sprint.
- Prospect: those are the customers that have already been contacted, either through call or email.
- Qualify: after you first contacted the customers and researched about how your company can be useful for them, you then have to identify their needs so you can:
- Send Proposal: on the Qualify phase of your Sales Cycle you identified your customer’s needs, so now it’s time you sent a formal proposal so you can go:
- Under Negotiation: this is the closing phase, when your prospect presents their conditions and you respond accordingly, overcoming possible objections.
- Won/Lost: after the negotiation phase is done, it’s time you get a signature (or not) and identify the proposals as won/lost.
Considering all your leads go through your sales cycle in this particular order (or however fits you best), focusing on increasing leads in these key stages will most likely guarantee you’ll sell more.
Each and every business will have their specific sales cycle stages, based upon their sales approach, the product/service they offer, the decision making processes involved, etc. Working with a Sales Pipeline template is great, but a single design won’t fit all, that’s why Pipefy’s Sales Pipeline Template can be modified to suit your needs.
How can you define your sales cycle stages?
The first step before you define your very own sales cycle stages, you have to take a closer look at your customer’s buying process and consider your customer’s point of view and the main decision points.
After you traced the buying process, you then write down the matching sales stages. It’s very important to discuss the stages with your team in order to get their input and find an initial understanding.
Check that the stages of the sales cycle you and your team agreed on match all your typical sales scenarios. This phase of the definition process is better done in smaller groups.
After the stages and scenarios have been cross checked, review the Sales Cycle with your team making sure everyone understands the importance of defining sales stages, as well as agrees on measuring their activities at each defined stage.
A couple of months after this first definition, revise the stages with your team. If any stage seems to be misunderstood or confusing for the team, rename, delete or add new ones, in order to achieve the most accurate reflection of your sales pipeline.
Having your sales cycle defined allows you to establish expectations for the activities at each stage as well as measuring the results achieved, allowing you to easily identify and fix glitches in your sales pipeline. As soon as your company has defined sales stages, you’ll have a baseline and common understanding, opening a world of opportunities to improve and optimize your sales process.
Free Sales Pipeline Template!
Try Pipefy’s Sales Pipeline Template, an easy to work with, step-by-step workflow developed to enhance your team’s focus and productivity.
This template will guide your team through all the steps of the sale, from prospecting, to properly qualifying leads to close the deal, helping them keep track of the opportunities and always staying on top of their game.