This is defined as the step-by-step process that companies require in order to close a deal. It includes every activity affiliated with selling a product or a service. Depending on the product or service, different companies have different stages in their sales cycle.
This depends on how they define the process. However, it is crucial that businesses monitor their sales cycle length for efficiency.
Stages of a sales cycle
Regardless of what a company is selling, every successful sale made follows almost the same path. It is crucial to master all the stages in order to improve sales efficiency, sell more and fasten the process of obtaining new leads. Despite the variations, the sales cycle process has the following common elements:
Prospect for leads – A business cannot survive without customers. The first stage is finding new potential prospects. Define the characteristics of a good prospect depending on the nature of the business and determine how to approach the prospect. The company should issue lead lists for the sales representatives to work on.
Set an appointment – After obtaining the lead lists, the next step is reaching out to the prospects. Sales representatives prefer calling them since it is the most effective way of setting appointments. Contact can also be made through emails, social media or letters. The only challenge is getting the prospects to the next stage.
Qualify the prospect – This happens during the appointment, although it can also be done during the initial contact. The main purpose of this stage is confirming whether the prospect is capable and willing to buy a product or service.
Presentation – This is the core of a sales cycle. Most of the time is invested at this stage due to thorough preparation. The goal here is to sell the product, making the prospect trust the process and making a good impression of the company.
Manage objections – It is a good sign when the prospect utters statements like “yes, but…” because it means that he is interested enough to raise concerns. Any objections like pricing should be handled appropriately to increase prospect win rate.
Close the sale – If the earlier stages have been handled perfectly, then this step becomes easier. It is at this stage when the prospect signs on the dotted line after being successfully convinced by the sales representatives.
Ask for referrals – Many sales representatives always storm out after getting the prospect to sign a deal due to fear of him changing his mind. Ask for referrals after closing the deal by giving the customer a business card and request if there may be anyone else interested in the product or service.
In some products, the process can happen in an instant while in others it can take weeks to qualify a prospect. It is better for businesses to have a quick cycle because dragging the process heightens the chances of a deal falling through.