Sales cycle is one of the most important key performance indicators for an integration business. Knowing your sales cycle maximizes cash flow, enables more accurate purchasing, and boosts overall performance through better use of labor resources. This new Special Report from Data by D-Tools takes a look at some key milestones in a typical sales cycle, including:
- Time from the first client meeting to the creation of the Proposal/Quote
- Time from the issuance of the Proposal/Quote to Signed Contract
- Time from Signed Contract to Order/Purchase Order
- Time from first client contact to completion of the project
- Purchase Order timing for various product categories
There are several key variables that can affect the sales cycle, including the size of the project, types of equipment and even the method of purchasing the gear. The ultimate effect from each of those factors is that they can alter the sales cycle, which fundamentally affects cash flow. That’s why it is vital to have a grasp on the average sales cycles for various-sized projects, as well as for different categories of equipment.
In terms of first contact with the customer to the issuance of the proposal, there are varying schools of thought on exactly how quickly an integration company should turn around a proposal to a prospective client following the sales presentation or walkthrough. Some integrators aim for a quick turnaround, getting the proposal to the customer within 48 hours. Other dealers want to make sure the client recognizes some additional time and effort went into the proposal development, so they do not practice quick turnarounds.
Looking at the time from the presentation of the proposal to the signed contract, D-Tools Cloud data shows an average of 35 days. That data is drawn from a random sample of 10 distributors and 20 manufacturers across a wide gamut of product categories. Within that same sample group, the average time from getting the signed contract to creating Purchase Orders for the components is 47 days.
Those are just some of the key metrics contained in the report.
Download the 2024 Sales Cycle Special Report for free here.
