You’ve just been introduced to someone who was not only very happy to meet you because you have the chops to take on a hot project that’s on his/her radar screen, but in addition has the authority to green-light your hire. Oh, happy day!
You’re thrilled to do the card exchange as your newest prospect requires you to make contact so that the two of you can talk specifics. You can almost taste the billable hours, but exactly how excited should you be? Statistical probability can help you put a dollar value on your happiness quotient.
I found this intriguing formula which uses historical data from sales outcomes and statistical probability data, enabling you to calculate the expected value of your upcoming prospect. As has without doubt been reflected in your own experience, there exists a randomness to networking and Solopreneur consulting contracts. Inside your effort to bring much-desired predictability and financial security for your life, the Solopreneuer’s objective is always to control variables, positively impact outcomes, win projects and generate revenue.
Let’s say you’re talking to a potential client in regards to a project that you estimate will be worth $10,000.00. The operative word is estimate. $10K is definitely the potential value, but it’s not the actual value until and except if you or someone else is awarded the project. If no one wins the project, then it’s worth zero.
The project’s worth is impacted by the possibilities of an excellent close. These formula enables you to calculate the possibility worth of the prospect and also the project through the various stages from the sales process.
Both the steps inside the sales process as well as the values assigned at each step in the process are based on historical data provided by a big corporate sales force. To refine the accuracy, identify the steps in your usual sales process and record your profits success rates at every stage of your own sales process.
I. Identify the steps inside your sales process:
* Invitation to fulfill and discuss the project
* Initial appointment / discussion of needs and benefits
* Verbal proposal / assessment of needs and benefits
* Invitation to submit written proposal
II. Determine the odds of an effective outcome at every step:
* Invitation to go over project 2% success
* Initial appointment / discussion of needs 8% success
* Verbal proposal/ assessment of needs and benefits 25% success
* Invitation to submit written proposal 65% success
III. Calculate the dollar value at every point in the sale for a proposed $10K project
* Invitation to discuss project $ 200.00
* Initial appointment / discussion of needs $ 800.00
* Verbal proposal / assessment of needs and benefits $2,500.00
* Invitation to submit written proposal $6,500.00
Exactly what do the statistics mean? In case you are invited to fulfill with the prospect, there is a 2% possibility of winning the agreement at this point. If because first appointment the prospect launches a conversation in regards to what would or could be needed with regards to project work, you bump approximately an 8% chance of winning the contract. The dollar values let you know how much the sales process is “worth” at every step that leads up to signing the agreement, if you can to do so.
If inside the conversation, or in a follow-up conversation or email, there is a discussion of project specifics, including its purpose, needs and benefits, as well as the talk centers around the suitability of the rohnfp and expertise to complete the job, then there is a 25% probability that you will be awarded the project. Should you be invited to submit a written proposal, your chance of signing the contract advances to 65%.
The key to customizing the effects probability formula for your company is keeping detailed records of sales presentations from which to compile your statistics. Here is an additional reason to document your company transactions in order that reliable data is going to be there to steer your company planning.