Not all forecasted deals close when projected. In fact, according to results published by The TAS Group in its Dealmaker Index Global Sales Benchmark Study, a full 51 percent of forecasted deals fail to close as predicted. The study, which polled 750 global organizations, also showed that 59 percent of total forecasted deals never make it across the finish line.
Ready to increase win rates on all those stuck, lost, and neglected deals? Try these expert tips from Matt Close, EVP Sales at The TAS Group.
1. Establish (or improve) your sales process.
If you lack a formal sales process, it’s time to develop one. The Dealmaker Index Study indicates that companies with well-defined and implemented sales processes reduce sales forecast misses to 33 percent.
“The study shows that following a well-defined sales process had a positive effect on win rate,” says Close. “Where a defined process was in place, win rates exceeded 50 percent in two-thirds of our study group.”
The effect of sales process on forecast accuracy is even more pronounced. According to Close, those respondents that understood and executed sales processes also had accurate forecasts (67 percent of the time). Conversely, the overwhelming majority (71 percent) who did not follow a sales process of people had poor forecast accuracy.
2. Start using (or improving) a sales playbook.
While a sales process can provide a roadmap for sales reps, a sales playbook can help you to map your selling process to the customer’s buying process, and direct you to the steps needed to move deals through the pipeline.
“We define a sales playbook as a sales process comprising the set of best practice steps, customized for your business, that tells you what you need to do next to progress a sale through each stage of your pipeline,” Close explains. “A good sales playbook includes the right sales tools, links to external resources, and marketing collateral. With those elements, reps have everything they need to advance each deal.”
A sophisticated sales playbook helps you learn the rhythm of your business, predict the close date of an opportunity, and underscore for your teams the crucial difference between when they think a deal will close and an accurate projected close date based on past behavior of winning sales cycles.
3. Get smart about the way you track the progress of deals.
Spreadsheets hold back many sales teams from creating accurate forecasts. Add to this the old-school approach of qualifying deals based on intuition and subjective criteria, and the result is that only three-in-ten deals close on average.
However, intelligent deal qualification and smarter insight into deal and pipeline health improves to a winning ratio of four-in-seven deals. According to Close, forecasting technology can help you drive predictability and also identify vulnerabilities in your pipeline. These potential risks will revolve around what’s in the forecast, whether or not a sales rep is counting on unusually large deals to make the quarter, which deals are being worked, what’s closed, and what’s projected to close. With Dealmaker, for example, managers can see which deals are moving quickly – and which have stalled – and then engage the proper pre-sales support to make sure these deals go through.
“With this visibility, you can apply coaching and support to keep deals moving forward and identify where you might need to apply more resources, change strategies, or redouble your efforts,” says Close.
Sales professionals spend two-and-a-half hours every week – roughly 130 hours annually – on forecasting. Make sure your reps are making the most of that time by setting them up for success with an excellent sales process, a killer sales playbook, and sophisticated deal-tracking technology.