Explain the impact of the sales cycle

MM2.01

Objective ADefine the term sales cycle.A sales cycle is the time from when a

salesperson first makes contact with a prospect to the moment when a sale is made or finalized.

http://www.ask.com/web?q=what+is+a+sales+cycle%3F&search=&qsrc=0&o=0&l=dir&adt=0

The sales cycle is the sequence of phases that a typical customer goes through when deciding to buy something. As a rule, the sales cycle is described from the customer's perspective. http://searchcrm.techtarget.com/definition/sales-cycle

Objective A7 steps- seller’s perspective1. Prospect for Leads2. Set an Appointment3. Qualify the Prospect The idea is to confirm that

your prospect is both able and potentially willing to buy your product.

4. Make Your Presentation5. Address the Prospect's Objections6. Close the Sale7. Ask for Referralshttp://sales.about.com/od/salesbasics/tp/The-Seven-Stages-Of-The-Sales-Cycle.htm

Objective BDiscuss factors that affect the length of sales

cycles.The type of product or service that you sell is also a

critical factor to this whole issue. For example, some products allow the salesperson to make the sale and immediately move to another prospect. Others dictate that the salesperson not only sell, but install, service, and provide ongoing support services while others require not only sales and support but extensive travel and ongoing penetration, prospecting, and in-depth selling..

The culprit is often short-term vs. long-term thinking.

Objective BTime zones can be misleading. Calling across

the International Date Line can be even worse. Traveling across it is even more disconcerting. Dealing with international trade regulations can be almost impossible. And dealing with cultural differences is a real barrier.

Sales knowledge – combined with selling document and presentation automations technologies – improve the performance of all sales team members, including the newest team members.

Objective BThe length of your sales cycle is another

major component in time or self management. The longer the sales cycle for your product or service, the more complex contacts you have to keep organized, the more paperwork and correspondence, the more frequent the travel, the more detailed the management of the account, the more important time management becomes. http://www.bizjournals.com/triad/stories/2001/08/13/smallb3.html

Objective CDescribe the advantages/disadvantages of

short sales cycles.DisadvantagesShort Sales Cycle is more compressed and fast-

paced travel, but has frequent presentations, and must be carefully orchestrated. Short Sales have quicker delivery systems, but more complex contacts you have to keep organized, more paperwork and correspondence.

http://www.bizjournals.com/triad/stories/2001/08/13/smallb3.html

In short, when you have an extremely long sales cycle, the more potentially volatile your lack of time management skills can be. http://www.bizjournals.com/triad/stories/2001/08/13/smallb3.html?page=2

Objective C Cont.Advantages: In a short sales cycle, you can get a lot of quick hits.

A person makes a decision right away and there are no barriers or issues to hold them back http://www.thepedestalgroup.com/sales-cycle/

By shortening the sales cycles, the sales people are therefore able to focus their time on serious prospects http://it.tmcnet.com/topics/it/articles/215980-short-sales-cycles-with-pitch-maestros-sales-tool.htm

A shorter sales cycle can generate revenues quickly, thereby ensuring that the startup does not go bankrupt. http://www.go4funding.com/Articles/Sales-Cycle.aspx

Objective DDiscuss the advantages/disadvantages of long

sales cycles.Disadvantages: Consider some hypothetical math: It takes you three

months to close a $50,000 deal. If you can manage to whittle that window down to a mere eight weeks, presto!--you've just padded your P&L by $100,000 per year. - http://findarticles.com/p/articles/mi_m0DTI/is_2_32/ai_112686143/?tag=mantle_skin;content(You make less money, in more time.)

If you spend more than 90 days on any sales effort, you're wasting time. There are specific times during which companies buy for the year. If you're trying to sell to them at the wrong time or after they've made the annual purchase, then you are wasting precious time. - http://findarticles.com/p/articles/mi_m0DTI/is_2_32/ai_112686143/?tag=mantle_skin;content

Objective D Cont. The longer the time between critical activity (sales) and

results (pay), the easier it is to lose sight of the direct relationship between time use and income. The result, is a loss of income, potential opportunities and perhaps, ultimately, even a job.http://www.bizjournals.com/triad/stories/2001/08/13/smallb3.html

The length of your sales cycle is another major component in time or self management. The longer the sales cycle for your product or service, the more complex contacts you have to keep organized, the more paperwork and correspondence, the more frequent the travel, the more detailed the management of the account, the more important time management becomes. http://www.bizjournals.com/triad/stories/2001/08/13/smallb3.html

But if your sales cycle is long, then there are lots of opportunities for me to change my mind, look at other people, or generally stretch it out even more.http://www.thepedestalgroup.com/sales-cycle/

Objective D Cont. Advantages: Longer sales cycle, gives time to get to know the customer, and

spend time educating them about the benefits and uses of the product. http://jobsearch.about.com/od/sales/qt/sales-interview-8.htm

Longer sales cycle, the pace can be adjusted depending on the individual client you are dealing with. Some clients like to have a lot of information about a product right up front, are knowledgeable, and have a lot of technical questions. http://jobsearch.about.com/od/sales/qt/sales-interview-8.htm

In a long sales cycle, messages need to be more informative and detail-driven.  Rarely is a product or service with a long sales cycle considered by itself – it is generally being reviewed next to its competitors.  With that in mind, the easier it is for the client to get information about the product or service the more likely they will favor it.  

A long sales cycle can be deadly if you don't have supplemental

early sales in your sales funnel to fill in. http://engineerscansell.com/the-long-long-sales-cycle/

Objective D - Long sale cycle Advantages: Disadvantages:-Longer time to

make decisions-Helps the sales

process reach perfection

-both Businesses are losing productivity

-both businesses are losing money the longer they take time to make a decision

-Longer sales usually happen because representatives make an error in advancing to the next sales step (miscommunication)

Objective EDescribe actions salespeople can take to

shorten the sales cycle.Start the sales process with a decision maker and

not a committee or recommender. Once you have the support of a decision maker, all other entities fall into line and the process moves faster. Understand the decision making process. Know how the decision will be made, who will be involved and what criteria will be evaluated. This information will help you streamline your sales strategies instead of jumping through meaningless hoops.  Your focus on the things that matter to your prospect will lead to shorter sales cycle.

Objective E Cont.STEPS TO A SHORTER SALES CYCLE(1.)Focus on the customer’s pain as well as the

customer’s desire for gain. This goes beyond cost justifications and ROIs (RETURN ON INVESTMENT). Every day of delay cause another one hundred dollars to fly out the window. Even your prospect will call for a shorter sales cycle once they appreciate how much a delayed decision is costing them.

(2.)Longer sales cycles-- often happen when a rep incorrectly assumes they are ready to move on to the next step in the sales process. When the rep is wrong, the rep is forced to backtrack.

(3.)A shorter sales cycle-- will not only increase your productivity because you’ll be in position to sell more in a shorter period of time.  A shorter sales cycle will also increase your productivity because you’ll improve your close rate. http://www.nationalsalescenter.com/2010/02/steps-to-a-shorter-sales-cycle/

Objective E Cont. Product and service performance is important to the sales

cycle. The better aligned your offerings are with customer expectations, the easier it is for customers to evaluate and make a buying decision. Be brutally honest about the performance of your offering as compared with competitive alternatives.

 The bigger the sale, the longer the sales cycle will be. The size of the deal will generally dictate the sales cycle time. Accelerate the sales cycle by helping your customer prioritize, investigate, assess alternatives and plan for success.

Timing is everything. Time your sales process to the customer’s decision process for the fastest sales process. If the timing is off, your sale will have to wait until the cycle comes around again…you missed the train and have to wait for the next one.

http://sellbetter.ca/content/view/55/110/ http://www.kickstartall.com/documents/KS_Articles/ShortenSalesCycle_Jul2010.html

Objective FDiscuss actions salespeople take that lengthen the

sales cycle.1. Buyer/Seller Relationship If the buyer and seller do not have a good communication,

they cannot have a buyer/seller relationship.2. Sales Call Planning

The most frequent mistake that salespeople make is the failure to have the right objectives for a sales call. Fixing this problem has an immediate effect on the performance of all salespeople.

3. Sales Questioning SkillsOnly 14% of salespeople have well-developed questioning skills. Without knowing the best sales questions to ask, at the right time, the sale does not move forward and salespeople miss opportunities to deliver the highest quality service to the customer.

Objective F Cont. 4. Sales Presentation Skills

When presentations aren't crisply focused on solutions to previously agreed upon needs, salespeople miss sales that should have been made.

5. Gaining CommitmentNo sales call is successful unless the customer commits to take some action that will move the sales process forward. It is shocking to learn that only 38% of salespeople actually ask for commitment. Even fewer are able to handle stalls or objections.

http://www.actionselling.com/selling-skills.asp Sales people and managers need to be patient.  Everyone is

under pressure to bring in revenue but panicking during the inevitable sales cycle will not improve results, in fact it will do quite the opposite.  Constant reworking of your message, or changing the target list, or changing the sales team will greatly lengthen the sales cycle -- not reduce it.

http//www.sales2.comindex.php/articals/sales