How to Identify Your Biggest Sales Bottleneck

Research & Sources / Sales & Revenue Growth

A group of friends goes hiking. Some are fast, some are slow. However quick the front walkers are, the whole group arrives when the slowest hiker arrives. If you want the group to be faster, buying better shoes for the fastest walker will not help. You need to help the slowest one. Every sales process has a slowest hiker.

One stage limits everything

A sales process is a chain of steps: attracting interest, first contact, qualifying, the first real conversation, the proposal, the decision, the signature. Each step lets only a share of buyers through to the next one.

Somewhere in that chain is the step where the most buyers are lost, or where they wait the longest. That is your bottleneck. Improving any other step makes little difference until the bottleneck is fixed.

The usual mistake

When sales are disappointing, most companies try to get more leads. More marketing, more events, more advertising. But if the bottleneck is later, for example most proposals are never signed, more leads just mean more proposals that are never signed. You pay more and get almost the same result.

How to find your bottleneck

1. Draw your stages. Write down the steps a typical buyer goes through, defined by what the buyer does.

2. Count the last six months. How many buyers reached each stage? For example: 200 enquiries, 80 first calls, 40 qualified opportunities, 25 proposals, 6 signed.

3. Look at the drop between stages. In this example, the biggest drop is from proposal to signature: only about one in four. That is the slowest hiker.

4. Look at time too. Sometimes the bottleneck is not where people drop out, but where they wait. If proposals take three weeks to write, that is a bottleneck even if they are usually accepted.

Research by Jordan and Kelly found that companies with a defined process and regular pipeline reviews grew faster.¹ Counting stages is the simplest form of that discipline.

Common bottlenecks and first fixes

• Enquiry to first call: often a speed problem. Companies that respond within an hour reach decision makers far more often.²
• First call to qualified opportunity: often a targeting problem. Are you attracting the right buyers?
• Opportunity to proposal: often a discovery problem. Do you really understand the buyer’s need before proposing?
• Proposal to signature: often a follow-up, pricing or decision-maker problem.

Fix one thing, then look again

Once you improve the bottleneck, another stage becomes the slowest hiker. That is normal. Sales improvement is a series of small, focused fixes, not one big project.

What this means for you this week

• Count your last six months stage by stage.
• Find the biggest drop and the longest wait.
• Choose one fix for that stage and try it for a month.
• Pause any spending that only feeds the stages before the bottleneck.

Help the slowest hiker, and the whole group arrives sooner.

Sources

1. Jordan, J. & Kelly, R. (2015). Companies with a Formal Sales Process Generate More Revenue. Harvard Business Review, January 2015. hbr.orgA defined sales process, regular pipeline reviews and clear stage rules go together with faster revenue growth.
2. Oldroyd, J. B., McElheran, K. & Elkington, D. (2011). The Short Life of Online Sales Leads. Harvard Business Review, March 2011. hbr.orgCompanies that respond to an enquiry within an hour are far more likely to reach a decision maker than those that wait longer; many never respond at all.