Your Service Selling Pipeline: 6 Elements to Keep Business Revenue Flowing

By: Ken Lizotte
Submitted: 2007-07-04 15:22:27
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So you’ve launched a viable business entity and now you’re ready to grow it by seeking out more new customers.What to do next?Sure, you can promote your business through word-of-mouth referrals, and perhaps some sort of advertising, and even, , more and more likely in this day and age, promoting your company over the Internet. But at some point there will come an important moment when you and your associates need to get out on the road and sell to a major buyer if you really want to grow.

The concept of selling is different things to different people:fun for some, a dread for others, but certainly a necessity for any service business. Direct field selling is a key element for most companies whether they market a pure service or a quasi-service, i.e., part product, part service (such as printing).

As in most aspects of business, your service sales process can be viewed analytically. When broken down it can be seen as a series of sequential elements. When pieced back together,this process will produce a finished and integratedsystem capable of propelling revenue opportunities forward, culminating in a successful sale for many of them.

These selling elements, in combination, form what is referred to in the marketing trade as a “pipeline.” At the end of the selling spectrum is the order. At the beginning is the suspect. Your pipeline connects the two. In addition to a life-giving revenue flow, the pipeline offers the business owner two other ancillary benefits:

1. Anability to forecast the forthcoming revenue stream. This becomes possible because the owner can observe and quantify his/her number of prospects, presentations and proposals currently in play that will potentially advance the process rightup to the order, i.e., the sale.

2.The ability to spot weak links in the chain. This is vital if the pipeline is running a danger of breaking and is thus in urgent need of repair. What is typically the he most common weak link?Quite simply, n insufficient number of “hot” prospects, one of the most crucial selling elements in the entire pipeline.

To get specific about all these sequential pipeline elements, let’s examine them one by one:

1. The “suspect” This is a profiled buyer, defined as a firm or individual that could possibly have a need for a given service or product.

2. The “prospect” – This is a suspect that definitely has a need for the given service or product

3. The “hot prospect” – This prospect has expressed a clear interest in buying. The prospect’s reasons might include a belief that purchasing this product will result in generation of a cost payback within two years or that the prospect’s own productivity will be greatly improved. Whatever the expressed reason, a prospect becomes “hot” due to the very act of expressing one or more such reasons.

4. Proposal Submission – A hot prospect, i.e., a strong potential buyer, should be willing to sign an agreement and put down at least atoken fee or depositfor the seller to constructa customized proposal. A token amount might only be $100 to $200, just enough of a litmus test to affirm the buyer’s commitment to the sellers’ offering, though it should not so much as to jeopardize the buyer’s request for a proposal.

5. The Order. With the signing (or with a purchase order submission), the deal becomes official. Decide here if a guarantee or warrantee will be offered.

6. Program Implementation. The order is of course no value to the buyer in and of itself. The seller must take “ownership” of the service that has just been sold to the extent that the seller can help the buyer set up the purchased service and get it launched or started.

In the end, the key is to link these six elements into a productive chain resulting in a continuous flow of revenues. The activities required that comprise each link of this pipeline order-chain will vary depending on the type of service (or product) being offered. For example, the seller may need to conduct a snail-mailing or a cold-call telephone search to identify prospects from among the firms available on a purchased list of suspects. An illustrative ratio for significantly-sized orders (say over $5,000 each) might look like this:

50 suspects –-- 10 prospects --- 3-4 hot prospects--- 3 proposal submissions --- 1 order

For sake of discussion let’s assume that your average salesperson is budgeted to close at least one major new account (sale) per month. In this example, your sales rep would need to solicit 50 suspects a month (10 per week). Depending on the size and duration of the average order, this may be a reasonable figure for a salesperson with an assigned territory populated by customers requiring service.

The pipeline process can also be shortened in that a “lead” may originate through some promotional source. Depending on the potency of the lead, this could either be classified as a “prospect” or a “hot prospect.” For example, a “hot prospect” has expressed an interest in the service offered, while a prospect is thought to have only a mild or passing interest.

By routinely monitoring the numbers at each point in the pipeline the owner (or sales manager) can note weak links in the selling spectrum and predict growth in new business. In this way, your service pipeline can reap you rewards for years to come.

Article source: Expert Articles