The sales cycle is the process that companies undergo when selling a product to a customer. It encompasses all activities associated with closing sale. Many companies have different steps and activities in their sales cycle, depending on how they define it.
Finding a clear cut definition of sales cycle that spans across the sales industry is tricky. This is because many variations of the definition exist. Some people define it as the time it takes from starting from nothing to closing a deal. Others define it as the time it takes to bring a qualified prospect to close.
Regardless of the definition, however, businesses should keep track of the length of their sales cycle to ensure that their selling process is efficient.
Why is the sales cycle important?
Keeping track of the sales cycle gives a business insight into the efficiency of their sales operations. The length of this process can be tracked, analyzed, and compared to the standard length across the industry. If a company’s cycle is shorter than the average of its industry, it could mean that the company’s sales department is more effective than that of its competitors’.
Having a fast sales cycle is generally better for businesses because the longer it takes to make a sale, the higher the chance of the sale falling through.