Monitor Your Sales Pipeline
In most flooring businesses, there is a lag between seeing a fall-off in measures and the corresponding and inevitable drop in invoiced sales. In a residential business, the lag might be a month or two before we see gaps appearing in our laying schedule, but considerably longer in a commercial business where we have big projects ahead of us. On the other hand, residential sales can pick up relatively quickly, while commercial projects have a much longer lead time, resulting in comparatively longer periods when our layer book might be thin.
Gaps in our installation diary are no small thing. The less product we are installing, the less we are invoicing. What makes it worse is that unused installation time is lost forever, bringing with it the chance contractors might look for work elsewhere.
Unfortunately, in most businesses, the amount of work in the pipeline is a gut feeling; very few retailers know what a healthy pipeline is for their business, much less the value of their pipeline on any given day.
A quick test: How many samples have been issued in the last month, and how does that compare with previous months? How many quotes do you have out awaiting decisions? What is the value of those quotes? What is the number and value of confirmed sales awaiting installation?
To make them relevant, you need to understand what each of these numbers should be for your business to achieve your sales targets.
We also need a plan for when we see our pipeline emptying out. Great customer service is always important, but there are times we need to lift our game to ensure every opportunity is maximised. If shop traffic has fallen off, engaging with those who come into our store becomes more important than ever. The goal is to find the product the customer needs, get the measure, get a quote out promptly, and follow up to secure the sale.
We should have good follow-up processes in place now; starting to follow up when things are slow is not the best time to start that discipline. Regardless of our current follow-up process, our salespeople need to lift their follow-up game when the pipeline is thin.
A response to an emptying pipeline is often to spend money on advertising. In my experience, advertising doesn’t quickly turn the situation around. The better solution is to reach out to everyone we have quoted with an offer that will get them across the line. You might talk with your suppliers about some short-term discounts you can pass on to help close a sale without sacrificing too much GP.
Understanding and monitoring your sales pipeline is a good use of your time as a business owner. Depending on your business management system, some of the information you need won’t easily be available. If you would like to see how RFMS can quickly, easily, and accurately provide you with the information you need for this aspect of your business, we would be happy to show you and answer your questions.