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Sales Funnel Metrics

 

Disciplines > Sales > Sales articles > Sales Funnel Metrics

Funnel value | Arrival rate | Conversion rate | Flow rate | See also

 

There are several measurements you can use to determine the success and health of your funnel. These are typically measured over a fixed period, such as weekly, monthly or quarterly. This can then be used to show how well the funnel is doing and prompt corrective action.

Funnel value

Funnel value is the potential value of all the deals in the funnel. This represents future sales and can be used to plot estimated income over time.

Not all deal in the funnel will get signed and the funnel value can be made more realistic by weighting individual deals with the probability of completion. If you are not sure, then deals near the start of the funnel may be given a weaker weighting than those nearing closure.

Arrival rate

Arrival rate is the number of deals being qualified into the funnel in a given period. This can be expressed both in terms of numbers and potential value. These can be used to estimate sales effort and cash flow.

Conversion rate

Conversion rate is the ratio of deals that are closed to deal that enter the funnel, and gives a measure of the success of both the qualifying-in process and the sales process. 100% conversion rate means all deals which are qualified in get converted into sales, which of course is ideal but unlikely.

Flow rate

The flow rate measures the time that deals are sitting in the funnel. This can be measured as both an average and also a spread, for example with the maximum and minimum in-funnel time.

Within this you often find that there are several 'stuck deals'. These may be separated out and dealt with separately to prevent them skewing the rest of the data.

See also

Five qualifications

Sales Books

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