I love business ideas that are simple and elegant. Like the hula hoop. So simple, and yet so powerful. Timeless. It’s one of those, “I wish I had thought of that.”
The dollars per day that your sales business generates – just like miles per hour – is an easy measure of how efficiently your sales business is operating. And the equation is truly simple.
There are only 4 variables that affect your Sales Velocity:
- The number of deals you are working
- The average deal size
- The value win rate
- The average length of your sales cycle
A small change in any variable has an impact, and if you know these metrics for your sales business, you can take control of your sales velocity and accelerate it systematically and predictably.
That’s tangible business value and it’s easier than you think to implement.
So let’s imagine that you have the metrics, what’s the insight that comes from knowing these variables?
It’s tempting to focus on increasing the number of deals you’re working on. However, throwing more deals into the top of the funnel may detract from the effort needed to progress good deals that are at later stages of the funnel. An alternate approach is to qualify-out the deals that aren’t worth winning In other words, decrease the number of deals you’re working on to improve your win rate.
Here’s another tip you can leverage when you learn this simple, yet elegant sales philosophy. We’ve measured thousands of companies’ performance metrics over the years, and more often than not, length of sales cycle is the easiest variable to impact. And here’s why: most everyone’s pipeline contains dead deals that shouldn’t be there. Qualify these out earlier, gain clarity on what is real in your pipeline, and focus only on the deals worth winning.
For more tips on accelerating revenue with this simple formula for sales success, register for Altify’s 6-module email course, delivered to your inbox over the course of 13 days, Mastering Sales Velocity, The Key to Revenue Acceleration.
Today’s post is by guest author, Morgan Pierce, Senior Director of Product Marketing, Content & Community, for Altify, which enables sales teams to dramatically increase revenue and outpace competitors by putting the customer at the center.