What is the pipeline in sales

Power in sales through the sales pipeline

Dorothea Heymann-Reder October 22, 2015 12846 views
TheSales pipeline is an essential tool to manage sales consistently and effectively. Nevertheless, half of German medium-sized companies complain about the lack of a structured sales process. In the absence of binding guidelines and efficient organization, sellers fish in the dark and design their process according to the trial-and-error method. A lot of potential is wasted and valuable sales time is wasted. Sales pipeline The sales pipeline (or sales pipeline) divides the sales process intomeaningful phases one that certainactivitiesResponsibilitiesTimeframe andSales probabilities assigned. The aim is to control sales more efficiently and to reduce the sales cost ratio. Think from the customer perspective In specific individual cases, the sales phases should be based on the parallel purchase phases (the "Buyer Journey") To be defined. Every good salesperson knows that he has to think from the customer's perspective. A sensible structure of the sales processes is not created at the "green table", but taps into the experiences of the sales team. Therefore, the team should be brought on board when a company sets up a structure for its sales process. This later also increases acceptance in the sales team. A clear, logical sales pipelineis the Basis for functioning and manageable processes throughout sales. It decides whether the sales force should follow a clear agenda or act blindly - in a word: it decides whether they are successful or not. Best practices for the sales pipeline Since customers are different, the buyer journey and the sales process based on it are not rigid either. Still, there are best practices for thatPipeline management. In order to define sales processes and the associated phases, the right questions must first be asked. What information does the sales team need? How does it show when a customer moves from one phase to the next? Which statements must come from the customer? It is best to make a checklist and monitor the indicators. The checklist must be observed, maintained and further developed by the entire sales organization. Each phase in the sales process must be clearly named and described, as well as the transitions between two phases. It is important to find the right level of differentiation in doing this. Not every sales activity deserves its own phase. 30 phases are too many, two are definitely not enough. ThePhasing must not be an academic headbirth, but must remain practical for the sales organization and understandable for the individual employee. Since potential customers always jump from one phase to the next and the circle narrows, one also speaks of oneSales funnel („Sales funnel“).

Sales phases

The sales phases can be broken down schematically as follows:
phaseActivities (examples)Is the addresseedocument
Identification phasePotential buyers are identified through web registrations, trade fair activities, address procurement, market segmentation, email marketing and the like.LeadSelling opportunity
Qualification phaseAssess needs, qualify lead (e.g. according to BANT, i.e. budget, authority, need, time), does the product suit the customer?
Presentation phaseIdentify decision-makers, make appointments, precisely determine requirements, advise (“Trusted Advisor”), coordinate and present products as required.Interested partyoffer
Offer phasePrepare offer, negotiate conditions, submit offer, renegotiate, adjust offer, price negotiations.
Final phaseObtain verbal confirmation, make final adjustments, conclude a contractcustomerassignment
Post salesRecord signals from the customer, follow-up support, generate follow-up orderscustomerassignment
Not to be neglected is the sixth phase, in which sales activities are often initiated by service employees or the back office, as they are closest to “the customer” while sales return to their original tasks. This list is to be seen as a blueprint from which a corresponding checklist can be derived. Each sales organization should map its own sales process based on its experience. The phases may need to be tailored to the individual sales channels, regions, branches, products, measures and sales employees.

Metrics in the sales pipeline

In order for the sales pipeline to become a control instrument, certain parameters have to be measured. In this way, the sales organization can create targeted evaluations and optimize sales planning:
  • In numbers, e.g. B. How many acquisitions are currently in the pipeline or in phase X?
  • In money, e.g. B. What is the value of a potential contract?
  • In percent, e.g. B. What percentage of the sales opportunities lead to a deal?
  • In time, e.g. B. How long is the average length of stay in one of the phases or in the entire funnel until it is closed?
This information can of course also be broken down into individual employees, regions, product lines and customer segments. As soon as reliable figures are available on these aspects, you can also Conclusions derived and Improvements be initiated. A capable operational controlling will combine these observations with further KPIs to form a key figure system that is more informative than a number viewed in isolation. The entire sales and revenue forecast depends on the fact that at this point a efficient reporting is implemented.

Optimization of sales processes

For example, if there is a traffic jam in the offer phase, the offers may not have been properly worked out. If the average order value falls, sales control can focus on price enforcement. If a follow-up activity produces better results than another, prioritize it higher. And finally: if the graduation rate increases, this is confirmation of the course we have chosen. In the ideal case, the sales control can ensure a steady and growing order intake by skillfully operating the possible adjusting screws. In any case, it is important that the meaning of the measures is clear to every sales employee. Compliance with the developed sales processes is the be-all and end-all for the success of your business.

Pipeline management software

Many salespeople hesitate to implement a process because they fear being bullied and - in their eyes - having to do pointless additional work. It doesn't have to be. Modern software solutions are so flexible that they can map almost every sales process and support the seller instead of hindering him. In addition, they provide valuable evaluations in order to further optimize the sales organization.

Map the sales pipeline in software

An entrepreneur friend of mine has a history marketing agency. The target group are traditional medium-sized companies. The sales process often takes several months. Potential leads are addressed individually. It soon becomes clear whether there is a need, a budget and an interest on the part of the owner. This information flows into the lead evaluation. High-scoring leads are given priority. Experience has also shown that the first interview is around 20 percent likely to be completed, 60 percent for the second and 80 percent for the third. The activities, responsibilities, sequence of activities and the associated opportunities and risks are mapped in standard software and regularly checked. This shortens the lead time through the sales phases, as no steps are overlooked and the responsibilities of the employees are clear. Campaigns and other lead generation activities can be automated. All sales activities are traceable and verifiable - and they are documented in the software.

User-friendly and time-saving

Once the sales pipeline process has been implemented in the sales software, the few entries are made in no time at all. On the other hand, much more time is saved because searches, a lack of coordination, unstructured working methods and the pursuit of unprofitable sales projects are a thing of the past. Last but not least: Guard rails are necessary in order to work consistently and to avoid detours. In addition, sales software takes care of transparency and at the push of a button produces differentiated reports and analyzes for which you previously had to collect numbers for days and program Excel tables. The software-supported documentation of the sales processes ensures that all relevant information is stored in one place and is accessible at all times. Double entry and information gaps are a thing of the past. With mobile devices, the field service can log conversations, create evaluations, upload documents and delegate tasks to the office staff - regardless of location and in real time. Ideally, the pipeline management is embedded in the entire company software in such a way that the entire main process in the company can be mapped from contact management to the preparation of offers and orders to billing.

Always stay mobile

Markets, metrics and methods change over time. Sales managers know about this continuous change. You monitor changes closely, install a functioning sales controlling system and create realistic forecasts. Good managers welcome change as an opportunity, lead their team proactively and are always ready to readjust their instruments.


A structured sales process can make a sales organization much more successful. Every company should document and optimize its sales pipeline and implement it in configurable sales software. This makes the process leaner, more efficient and more consistent. Through evaluations in the various sales phases, the sales organization can concentrate on the worthwhile approaches and bring them to a close in a focused manner.

Dorothea Heymann-Reder

Dorothea Heymann-Reder writes blog posts, advice articles and white papers. Her specialist articles deal with commercial and business issues as well as the entire spectrum of digitization.

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