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How to Qualify Each Sales Opportunity

How to Qualify Each Sales Opportunity

Today more than ever, we need to pay attention to how our sales team and we spend our time. The cost of sales and the lost opportunity costs are significant for most organisations.

With a tightening market, we all need to get as much bang for our buck as possible. Our clients are controlling their costs by reducing spend, pushing expenditure out to a later date, and/or cancelling projects.

That means your revenue may become harder to forecast and your cash flow may become tighter. Your business also needs to control costs and maintain a healthy return on investment from each of your sales channels. Qualifying each opportunity is one way to ensure your direct and indirect sales teams are using their travel and accommodation budget, marketing budget, their time, and the time of other people in your business (technical resources, management effort, etc.) to best effects.

If you can answer all six of the following questions you have what we call a qualified sales opportunity:
  1. Do they have a defined project or activity?
  2. Who is the project sponsor and who are the key stakeholders?
  3. What budget are you working to?
  4. What is the timeline and schedule?
  5. Why does the business need this now?
  6. Where does this fit as a priority for the business overall?

These six questions are extremely powerful and provide an easy way for you to gain a detailed understanding of each sales opportunity.

In today’s market, you need to answer all six of these questions to have a qualified opportunity.

Pay particular attention to question four, “Why does the business need this now?" and six, “Where does this fit as a priority for the business overall?.”
If the honest answer to these questions is “No". There is ever chance the project will be delayed or cancelled...
If your client hasn’t got answers for all the questions, does it mean you walk away?

Not necessarily, just be aware that the sales cycle is likely to take much longer. Therefore, it is more than likely a business development activity rather than a sales opportunity. Of course, the best way to ask these questions is face-to-face!