Before you start the relationship building process with prospects, you need to identify which of your prospects are hot and which ones are not. Using BANT (Budget, Authority, Need and Time) criteria, you can better qualify what leads you should go after. Originally developed by IBM, BANT criteria can help you determine if there’s a budget, who holds the authority regarding the purchasing decision, their business needs, and the timeframe for the implementation. A sales rep needs to fill in three of those four criteria in order for a lead to be a sales opportunity. If sales reps can do this, they won’t be potentially wasting time with a lead that might have a need but no budget, or one that has a budget but the timing isn’t right.

Determining if a prospect has room for your solution in their budget is a critical step to closing a sale. The budget qualifying process usually falls into three categories: the prospect has available room in their budget; the decision maker doesn’t have room, but will find the money; it’s not currently budgeted, but may be next year. The budget is usually the most difficult part of BANT to discover, but it’s also the most integral part to the BANT equation. In order for sales reps to accurately develop their sales forecast, they must uncover the prospects that have money budgeted for their solution. It’s even more important now because of how companies’ budgets have been dramatically reduced, coupled with their capital spending plans. Fortunately for IT sales reps, there appears to be good news on the horizon. Comments from EMC’s CEO and CFO and data from CIO.com survey identifies that companies will start increasing their budgets and spending for IT infrastructures in 2010.

Sales intelligence resources can also assist you in determining the components of a prospect’s budget; what their capital spending plans are (time) and uncover their current business drivers (need). Sales steps should start the relationship building process by asking questions to better understand their problems and opportunities. By doing this, they can make a bridge to the budget discussion without forcefully asking if they have money to spend. You don’t want to be kicking tires with a prospect that has a need, but doesn’t have a budget. Identifying who owns the budget and if they currently have money for your solution will accelerate your sales cycle. If authority, need and time all meet the necessary criteria, getting your solution budgeted should be the priority for the decision-maker. Identifying the budget can be difficult, but once done, you’ll have discovered what prospects are hot, and you will be in a better position to forecast your sales.

Sales Forecasting Template

SalesQuest has created a FREE Sales Forecasting Template and Worksheet that will help you qualify your leads better and keep your sales pipeline full.

Download the FREE Sales Forecasting Template and Worksheet

- Mark Kilens
mark . kilens@salesquest.com
978.749.9999 ext. 118

©2012 Sales Intelligence Blog. All Rights Reserved.

Unfortunately, a harsh reality in sales is that, on average, 30% of leads in your pipeline will not convert to close. While sales forecasts are certainly not always correct, because sales can be a very unpredictable line of business, they can be extremely helpful in bringing more deals to close.

Sales forecasts can be helpful for time management for sales reps, as they can highlight which accounts they should spend their valuable time selling to, and which accounts are not highly likely to buy. Then, over time, these forecasts provide historical data on close rates for a variety of types of leads. The more forecasting you do, the more accurate you can become with your predictions if you assess the actual closing rates against your previously forecasted numbers.

The debate of over whether sales forecasting is worth spending time on is a heated issue within organizations and even the blogosphere—and both sides of the argument are valid. It is true that most forecasts are not going to be completely accurate, but it is also true that forecasting accuracy CAN be improved, and also that they can be helpful when they are not 100% correct.

The real issue is how much you depend on your forecast, and even more importantly, what you depend on it for. The worst thing you can do is to treat your forecast as a prediction of the future; depending on not-yet-closed sales to operate your business is, obviously, extremely dangerous, like using a credit card that you might not be able to pay off. In this respect, yes, sales forecasting may not be a good idea.

On the other hand, using this data to analyze patterns in your sales cycle and improve upon the process is a worthwhile endeavor. Sales forecasting templates are a good way to keep this information functional, consolidated and ready to analyze, especially if your CRM system does not already have a sales forecasting functionality. The more you can compare forecasted numbers with actual numbers, the more value you will get out of your future forecasts, and the more accurate they will become.

With a template, you may begin to see patterns in what types of leads are coming to close, which of your products are selling better, and ultimately be able to see how much time you are investing into these deals that is either profitable or a complete waste. Taking the time to fill out a template on a daily or weekly basis forces you to think about where you should be spending your time, and how long it might take you to close the sale, so that you can allocate your efforts appropriately and efficiently.

- Carolyn Sebasky
carolyn . sebasky@salesquest.com
978.749.9999 ext. 107

©2012 Sales Intelligence Blog. All Rights Reserved.