Why Salespeople Should Know Their Win Rate

As someone who has spent the last 15 years exploring, learning and training and consulting on the sales funnel, I often get asked ‘how important is it to know your win rate’?

It’s very important. When you know your win rate you’re able to know how big your sales funnel should be to hit your quota.

For example if you have a 1M quota and you have a 50% win rate, you should have $2M of funnel value. We call funnel value TVR, or Total Viable Revenue.

But if you have a 33% win rate then your funnel TVR should be $3m.

And if your win rate is 25% your funnel TVR should be $4M.

Those are some big variations in funnel value, aren’t they? Not knowing your win rate could mean you could easily miss judge this by a mile.

Unfortunately I have a feeling that few salespeople and their sales organizations really know their win rate.

It’s easy to calculate. Create a list of all of the sales opportunities you try to win. Then list the ones you do win. The number of sales you win divided by the number you try to win is your win rate.  For example if you win 3 but try to win 10 then your win rate is 30%.

This next part is really important. When you calculate your funnel value you don’t want to add up the dollar value of all sales opportunities at all stages. Instead you want to add up only the deals at the mid to late stages where the customer has committed to making a change. That means they commit to either replacing what they’re using with something else, commit to add to what they’re using, or commit to using a different approach altogether.

When you think of your sales funnel right now, you can probably think of deals that haven’t gotten that far in the customer decision process yet, can’t you? These deals might still be very much worth your time to keep working on, just don’t count them as funnel value TVR.

If your sales funnel doesn’t have enough of these mid to late ‘commit funding’ opportunities, it’s too small, and now you’re under pressure to have a higher win rate to still make your quota.  That’s not a strategy I would encourage.

If you liked this tip and want to learn more I encourage you to contact me at the information on the screen. I’d really enjoy hearing from you.

I wish you the best success, and good selling.

Mark Sellers


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