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

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

by Brooks Fenno, CMC

Unless your practice is so strong that you can't even imagine taking on any new business, you're probably like many actuaries and finance consultants who are continually seeking effective ways to keep adding both new projects and new customers. Sure, you can promote your business through word-of-mouth referrals, perhaps even advertise here and there, or use search engines to find your Web site. But at some point you need to do more. you need to get out and sell.

The concept of selling means different things to different people: it's fun for some, a dread for others, but certainly a necessity for any service business. To be effective, try breaking down your "sales service process" analytically and view it as a series of sequential elements. When pieced back together, these steps will produce a finished and integrated process capable of propelling revenue opportunities forward, culminating in frequent successful sales.

In combined form, these elements form what marketing/selling experts call a "pipeline." At the beginning of the selling spectrum is the "suspect," at the end is the "order." Your pipeline connects the two, also offering two ancillary benefits:

1. An ability to forecast your forthcoming revenue stream. This becomes possible because you can now observe and quantify your number of prospects, presentations and proposals currently in play. Knowing this potentially advances your selling process right up to the order, i.e., the sale, by keeping things moving along.
2. An ability to spot weak links in the chain. If your pipeline is running a danger of breaking, you'll now be able to work on it before it does. And what will typically be your most common weak link? Quite simply, an insufficient number of "hot" prospects, one of the most crucial selling elements in the entire pipeline.

Specifically, there are six sequential pipeline elements in all. They are:

1. The "suspect." A profiled buyer, defined as a firm or individual that could possibly have a need for your services.
2. The "prospect." A suspect upgraded to a potential buyer who definitely has a need for your services.
3. The "hot prospect." This prospect has actually expressed a clear interest in buying. Whatever the actual expressed reason, a prospect always becomes "hot" due to the very act of expressing one or more such reasons.
4. A proposal submission. A hot prospect, i.e., strong potential buyer, should be willing to sign an agreement at this point, and even put down a token fee or deposit so that you can go ahead and construct a customized proposal. A token amount might only be $100 to $200, just enough of a litmus test to affirm the buyer's commitment to your offering but not so much as to jeopardize the buyer's request for a proposal. The proposal itself should contain a statement of the prospect's situation, a proposed solution, a price and terms section and a benefits summary.
5. The order. With the signing of a contract (or with a purchase order submission), the deal becomes official. You should decide here if you will also offer a guarantee or warrantee for your services.
6. Program implementation. The order is of course of no value to the buyer in and of itself. You now take "ownership" of delivering your services.

In the end, what's key is linking these six elements into a productive chain, so that the result will be a continuous flow of revenues. The activities required that comprise each link of this pipeline order-chain may vary depending on your precise type of services, but an illustrative set of ratios might look something like this:

• 50 suspects LEADS TO
• 10 prospects LEADS TO
• 5 hot prospects LEADS TO
• 3 proposal submissions LEADS TO
• 1 order/sale.

The pipeline process can also be shortened in that a "lead" may originate through some marketing or promotional source, perhaps an article you have published or a speaking engagement you have delivered. Depending on the potency of the lead emanating from this source, you might classify it as a "prospect" or even a "hot prospect." If either is possible, this lead has jumped ahead a few of the elements in your pipeline.

By routinely monitoring your numbers at each point in the pipeline, you can note weak links in the selling spectrum, fix them where necessary, and begin predicting growth in terms of new business. In this way, your service pipeline reaps rewards on a continual basis both now and in the future.

Brooks Fenno, CMC, principal of SALESMARK, is a longstanding Massachusetts-based management consultant with expertise in diversification into new products and new markets. To learn more, visit his Web site or call 617.536.0197.