May 4, 2020

How to Boost Closing Rates

By Henry Canaday

Clients often tell Julie Thomas, president and CEO of ValueSelling, they have one big problem. They have great initial meetings and successful demos – and prospects appear to love them – yet, when they send in a proposal, “It’s suddenly crickets, dead silence, no response.”

Thomas says those crickets often chirp because salespeople jump way too quickly to proposals and then have very low closing rates. “They are trying to close unqualified opportunities,” Thomas says. “Critical steps have been missed in the sales cycle; the prospect is not ready to make a decision. Closing is just the outcome of a well-executed sales cycle.”

There are five key reasons that reps can’t close a deal.

  1. The prospect has been given no compelling reason to make changes required by the sale. All competent reps are good at finding prospect problems or pain points, “but not all problems are created equal – some business problems may not be worth solving,” Thomas says.
  2. Reps have not sufficiently differentiated their companies’ products or services from competitive alternatives. The prospect may be confused and select an alternative supplier or solve the problem in-house.
  3. Reps fail to understand the impact of proposed solutions on both prospect companies and individuals making buy decisions. “It’s not just the ROI or cost saving for the company, but also the impact on individuals.”
  4. Reps have expended selling efforts on people who cannot buy. “The person may not have the authority or ability to make the buying decision. They have not found the right decision maker because they have gotten too comfortable and cozy with the person they have access to.”
  5. Prospects perceive too much risk in adopting reps’ solutions, even if they like the rep and the concepts proposed. “They are not convinced they can introduce the solution into their environment without too much risk,” Thomas explains. “The rep has to mitigate the risk with a pilot, a trial, a proof of concept, or a customer reference.”

The best reps notice when they have missed any of these steps. “The best reps dismiss the unwinnable opportunities sooner rather than later,” Thomas says. “Then they find new opportunities.”

In contrast, Thomas recalls a client who told her that any opportunity that stayed in the pipeline more than 100 days almost never closed. It just made the rep feel good and kept the rep busy with lots of activity when the rep should have been pursuing other opportunities.

ValueSelling teaches all reps how to ensure no steps are missed. Generally, the remedy for low closing rates is spending more time upfront, doing thorough discovery, understanding prospects’ business problems, and seeing that all decision makers and decision influencers have been identified and engaged.

For more information contact Julie Thomas, president and CEO of ValueSelling Associates, at julie.thomas@valueselling.com.