Sales Pipeline

A sales pipeline is a representation of every potential deal in progress, organised by stage from first contact to the final outcome. Typical stages are lead, qualified, demo or proposal, negotiation, and closed won or closed lost.

Why it matters

The pipeline shows what is likely to be sold and when, so managers can forecast revenue, find stalled deals and see where prospects drop out. Metrics drawn from it include stage-to-stage conversion rates, average deal size, sales cycle length and pipeline coverage, which compares open deal value with the target. Most teams manage it inside a CRM as a board of cards moving across columns.

Example

Stage          Deals   Value    Win rate
Qualified       40     200,000   25%
Proposal        15     120,000   40%
Negotiation      6      60,000   65%
Weighted forecast = 50,000 + 48,000 + 39,000 = 137,000

Common mistakes

• Leaving dead deals in place, which inflates the forecast.
• Using stage definitions that differ between salespeople.
• Treating the total value as expected revenue without weighting by probability.
• Mixing it up with a marketing funnel, which covers earlier, anonymous stages.

Related

• CRM
• Marketing funnel
• Lead generation
• Conversion rate

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