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Seven stages of sales.

The Artisans Group, Olympia, Wash., tracks job leads through seven stages to sharpen its sales and marketing focus. "We've learned that our highest closing ratio comes from professional referrals," such as subcontractors and suppliers, says Chris McDonald, vice president of sales and marketing. His company closes on 15% to 20% of leads that make it to stage 2 or beyond. "I once heard that if you close more than 20% of your leads, you should raise your prices," he says. "By this measure, we've found our pricing niche."

Stage 1: Initial call. If The Artisans Group simply does not do the type of work the caller seeks, the receptionist has the authority to "kill" the lead and, if possible, refer the caller to other companies. About 10% to 15% of inquiries die here.

Stage 2: A lead is born. Having made it past the first line of defense, the lead is now considered legitimate. The "project developer"--a title created by the company to acknowledge that salespeople do much more than selling--calls the prospect within 24 hours, escalating the qualification process by asking about goals, budget, and timeline. About 30% of leads die at this stage.

Stage 3: Site visit. A prospect who reaches this stage is considered a potential match. The project developer visits the prospect's home, where he verifies what was said on the phone, evaluates the project's physical and financial feasibility, and provides a ballpark estimate. Approximately 15% more leads drop off here.

Stage 4: "Darn good" estimate, The project developer crunches some numbers based on his general understanding of the prospect's wishes. In about 25% of cases, the lead dies here, usually for financial reasons. Just two stages remain to convert the remaining leads into actual projects.

Stage 5: Design phase, The company believes the project is doable and presents the prospect with a design agreement (or "feasibility study agreement"). This stage can last from a week to six months depending on the scope of the project. Just 5% of leads drop off at this point. Smaller projects skip this stage and go straight to stage 6.

Stage 6: Decision time. The prospect is given a detailed proposal and all the information necessary to make a final decision. The Artisans Group has built a substantial relationship and calls this the "very likely to sell" stage. But another 4% to 6% of leads die at this stage, usually due to competition or a final price objection. For all others ...

Stage 7: Sold!

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Title Annotation:Your Business: Sales+Marketing
Author:Thayer, Leah
Publication:Remodeling
Date:Jul 1, 2005
Words:415
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