Monday, 16 August 2010

Why qualifying sales will help sales grow

Why do you need to qualify sales leads?

- The process which takes a lead through to a sale (the conversion process) can consume a lot of resources, particularly for complex sales

- This process is much more productive (that is, has a higher conversion rate and uses less resource) if those leads which are likely to be low value and/or unlikely to result in a sale are screened out earlier in the process

- If the conversion process has very low marginal costs (eg an online shop) then the need for qualification is correspondingly lower

What factors can be used to qualify sales leads?

- The factors can vary widely according to the industry you are in but could include:

o Are you talking to the decision-maker and budget-holder?

o Are they in your target market and the right type and size of customer?

o Do they have the funds or budget to buy your product?

o Do they have the compelling need, commitment and motivation to buy now?

o Can you provide what they need without stretching your product, credibility or resources?

o Do you have all the necessary pre-qualifications (policies, accreditations, size and stability)?

o Is there an incumbent or preferred supplier who is almost certain to win the business?

How are leads qualified?

- Qualification should be part of your sales process

o It should also be built into your marketing

- It could take place at a single point or you could have several stages of qualification

- The criteria for qualification (taken, for example, from the above list) should be recorded against each lead in your sales management system

- The conversion process results (wins and losses) should feed back into the qualification process

o A low conversion rate may well indicate poor qualification

More business advice for business owners.

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