Pipeline —
Definition of B2B Marketing and Sales Terminology
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Pipeline

Usually referred to as the “Sales Pipeline Report,” the Pipeline presents sales opportunities in tabular form (think Excel spreadsheet), sorted by sales stage and the value of the deal and the month it is projected to close. The value of each sales opportunity is then multiplied by a percentage representing the average close-percentage for deals that reach a particular sales process stage.

For example, let’s assume you have 3 sales opportunities projected to close in December. The first is currently at stage 1 and if it closes, you will sell $50,000 in merchandise. The second and third opportunities are at stages 2 and 3 and represent sales of $100,000 and $10,000, respectively. Based on historic averages, when opportunities are at stage 1, you close them 10% of the time. Your success rate for stages 2 and 3 are 30% and 50%. Multiplying these numbers ($50,000 x 10% + $100,000 x 30% + $10,000 x 50% = $40,000) gives you the forecasted revenue for your territory in December.

Notice that a $50,000 opportunity at stage 1 is worth the same as a $10,000 opportunity at stage 3. This is an important point. Often, sales people spend so much time chasing larger deals that never go very far they forget about the smaller opportunities that have reached the later stages. Ignoring these smaller opportunities is obviously a mistake.

Marketing Strategies: TREK Methodology, B2B Sales Rep Pipeline Software