Sometimes it can feel like your sales cycle is dragging on so long that it will eventually suck the life right out of your business. Anybody who’s ever needed to close a deal to make payroll knows exactly what I’m talking about.
The speed of your sales cycle is one of the most important factors in determining your ‘sales velocity’, which is one of the best measures of how fast your business will grow, how much cash flow you can generate, and how well you can afford to self-fund your business versus getting funds from outside investors.
The formula for sales velocity is:
All of these factors should be continuously improved, but in my experience, the length of sales cycle doesn’t get nearly enough attention from most entrepreneurs.
Focusing on speeding up your sales cycle is one of the most important things an entrepreneur can do, particularly when your business is smaller and more resource-constrained.
And the way to do it is by removing as much sales resistance as possible.
So what is sales resistance and how do you remove it? Let’s see!
Sales resistance: what’s slowing you down?
Sales resistance is simply anything in your sales process that’s causing it to slow down. The cause can be any of a wide variety of factors, including:
- The structure of your deal
- Poor site design
- Nasty contract terms
- Difficult pricing or payment plans
- The lack of decision-making authority of the person your speaking with
- The language you use and the response it gets from your prospect
- Making decisions by committee
- Not having a guarantee
- Not having good testimonials
There are all kinds of factors here, and it’s your job to hunt them down and knock them out so you can accelerate that sales process.
Think about your sales process and what points of resistance you meet along the way. In my experience, it’s pretty easy to identify a few different places in any sales process where deals just seem to drag.
If you are selling online, it’s quite easy to see where things are getting hung up by looking at metrics in your analytics and comparing each step of your sales cycle to well-established benchmarks. Is your email opt in only converting at 8%? Then you know you have a serious point of resistance there – I’d expect you to be able to get that 25% fast with some focused effort.
If you have a person-to-person sales process including phone calls and office visits over time, it’s critical that you track how long deals get stuck in each step of your sales process so you can see trends and diagnose problems. It’s not as easy as the data available in an online sales process, but it’s definitely doable with diligent management of your CRM.
Identify your three biggest ‘stuck points’, even if it’s just a best-guess at this point.
Get creative and test
The next step is to simply brainstorm ways to remove resistance and speed up your ‘stuck points’, and then start testing your ideas.
You may be thinking, “But surely there are specific ‘levers’ you can and should pull first to speed things up as easily and quickly as possible, right?”
Yes, there are. Here are the ways to remove resistance that I believe are most universal and effective:
- Increase the clarity of your sales and marketing messaging – clarity about what you do, who you do it for, and the benefits they’ll get from buying from you is the #1 factor slowing down most sales processes.
- Improve any factors that create trust – sales is a transfer of trust. If I don’t trust you, I’m not going to buy from you. Factors that increase trust should be increased, and those that decrease trust should be removed or eliminated.
- Clearly define, control and measure your sales process – as the saying goes, what gets measured gets managed and improved.
- Use content market to get prospects ‘sales ready’ before entering your sales funnel – a prospect that is very aware of your brand, your products, and your value proposition is going to be a much more likely to buy more quickly on average. Content Marketing is a perfect, high-leverage, and very scalable way to get more of these ideal prospects in your funnel without much additional effort.
- Remove steps – sometimes it’s simply a matter of removing the number of steps in your process. This has been proven to be very effective in ecommerce – simply taking away excess steps can dramatically improve conversion. I’ve found the same to be true in person-to-person B2B sales processes as well.
- Pursue a different model entirely – sometimes the best thing you can do is throw out what’s currently been working to give yourself room to do something entirely different – that’s how breakthrough models get created. Dell Computers is a perfect example of business that completely and dramatically changed the computer-buying sales cycle by pursuing a different model. I have another example for you below.
Every one of these factors can be systematically tested, which is the next step.
Once you’ve generated some specific ideas, rank them based on their potential impact and ease of execution, determine how you’ll test and measure them and start testing.
We follow the process outlined here:
This process creates a continuous loop of learning and improving. Work it regularly and you can’t help but improve the speed of your sales cycle!
Breakthrough sales cycle improvement: Paint Nite
As I mentioned earlier, Dell Computers is an incredible example of how improving sales cycle speed can dramatically improve the fortunes of a company. Here’s a powerful example: Paint Nite.
Paint Nite is one of the fastest-growing companies on the 2016 Inc. 5000 list. They are a local marketing business, and they’re filling bars and restaurants be promoting events.
This is, of course, interesting to me, because I’ve been in the local marketing industry for a long time. When I see a business that’s number two in terms of growth in the industry, I have to look at it and ask, “What the heck are these guys doing?”
Well, they are practicing a concept that I actually shared on our Facebook page and podcast that’s a ‘breakthrough model’ when it comes to selling in any small business:
They are making a sale without making a sale.
That’s the ultimate way to remove sales resistance!
So, what do I mean by ‘making a sale without making a sale?
I simply mean that instead of selling to the bars and restaurants (who are benefiting from the marketing power of these events), they’re selling tickets to the events directly to the end consumer.
So yes, of course they are still making a sale to someone. But what Paint Nite learned is that selling ‘event marketing services’ to bars and restaurants is a painful, slow process, but selling a fun night of entertainment to consumers is actually quite easy.
They are two totally different sales processes, with totally different sales velocities.
So Paint Nite makes the sale to the consumer instead of selling to the restaurant — because selling entertainment to consumers is much easier than selling marketing services to businesses.
It’s kind of puzzling and unfortunate, but it’s just reality. That’s just human nature.
Paint Nite then delivers a room full of happy customers to the bar or restaurant, and a fun night of painting and wine for the consumer. For many of them, it’s their first time in that bar or restaurant, so the bar and restaurant are thrilled to be introduced to new people, and the people are having a great time.
The restaurants and bars soon learn the power of Paint Nite to impact their business, and start competing to get Paint Nite events at their location instead of that of their competitors. Paint Nite has totally turned the tables – no more sales resistance!
That’s a win-win with a fast sales cycle, and Paint Nite is exploding in growth because of it!
Let’s break it down:
- New customers are filling up the bar or restaurant in its downtime (downtime for a restaurant is a killer of their profitability).
- Marketing is done, and the restaurant doesn’t have to agree to pay for anything up front. They don’t have to sign up for marketing services, you’re not charging them $1,500 a month to throw events for them, and they aren’t paying money for an ad.
- Paint Nite is selling tickets to the customers. They’re taking the risk, and benefiting from the upside because they know they can do the marketing required to fill the events pretty easily.
- Restaurants and bars soon start to competing to get Paint Nite events at their location!
Making a sale without making a sale – a win for everybody! Again, that’s a powerful example of removing sales resistance, in this case by making a powerful shift in their model.
Which is why they’ve gone from zero to 50 million dollars plus in revenue very quickly.
Apply this to your business & then get creative
How can you remove sales resistance?
Every business has sales resistance, and every business can grow faster if it gets removed.
Get creative, because it’s a game changer for increasing your growth, your cash flow, and your ability to self-fund.
Let me know what you come up with!