Sales pipeline management

Do you have a sales pipeline? Is it working well for you?

What is a sales pipeline?

If you aren’t familiar with the term, a sales pipeline is the series of steps it takes for you to make a sale.

It’s called a pipeline (or funnel) because each step weeds out more people until you get to the final stage of the sale, where you’ve either won or lost the bid. If you track this, you will know when and how you lost a sale and can start to focus on improving that step.

Our sales pipeline has these steps:

1. Lead: Something we’ve heard of or someone we’ve met or have been referred to. We haven’t actually talked to them yet.
2. Intro: We’ve had a conversation with the potential client, or someone we know has introduced us, so the sales process is in full swing.
3. Talk money: We make sure to talk ballpark estimates in the first or second meeting; never move to the next stage without checking this off.
4. Proposal sent: We’ve sent over the numbers, and we’re waiting to hear what the client says.
5. Negotiation: The client has looked at the proposal, and we’re coming to terms.
6. Hold: If a client isn’t ready yet, but the project isn’t totally dead, the project goes in this column. The hold list is a great place to start when you need to drum up more business.

Setting up a sales pipeline

There are lots of options for setting up a sales pipeline ranging from free to very expensive (think SalesForce). The ones we’ve used are:

• Trello: Great if there are only a few of you. Create a board, add a list for each stage, then move your cards around manually through the list.
• Airtable/Notion/Clay Similar to Trello, but you can hook up a lot more information and set filters and views to get pretty close to specific sales-pipeline apps like the next two. We’re currently using Notion but we’re exploring Clay.
• Capsule CRM: We used this on and off for a few years. It’s an excellent option for managing your sales process. CRM stands for Customer Relationship Manager.
• Copper: It syncs with Gmail and has a lot of powerful features. We used it when we were booking a lot of business after a merger and acquisition, and it helped us stay organized and on top of things. For us, it was overkill with an expensive price tag.

Know where you lose a sale

Knowing where in the process you lost a sale is one of the best things a pipeline can do for you. Always track at what stage and why you lost a deal. Sophisticated apps like Copper allow you to track loss reasoning. We have set these as our options:

• Price
• Capabilities
• Client chose competitor
• 🚩 Red flags (this not something you usually see in a CRM, but we use it for when a client just doesn’t feel right to us)

Loss reasoning can help you fine-tune where you are spending too much time or what business practices you need to improve.

Years ago, we found that we were losing almost 50% of our sales in the proposal stage, which meant we were spending a lot of time writing proposals that weren’t going anywhere.

We added one crucial step — talk money — to our pipeline, and now we close about 90% of the projects that make it through this step. This means talking about a ballpark estimate before you write any proposals and getting the client to agree to that range. We’ve all been there: You think it’s a $50,000 project, and the client has $5,000. Find out early and save yourself time and heartache.

Proposal process

We break out the proposal process from the sales pipeline and focus on that separately. Bidding is the point at which you make or break a project. Overshoot and the client will think you are whack and not give you the project; underbid and you end up eating it or making your client mad when you ask for more money.

You have to get this right. The steps and elements of our proposal process are:

• New business tracking: In Notion.
• Storing files: A list of where we keep all potential client materials.
• Meeting notes/requests: A template for recording everything we know about the job. One person takes the lead, and then other members of the team add their notes and input to the master doc so we have one record.
• Confidential bid list: A list of what various deliverables cost (a logo, a brand guide, personas if the client supplies research, personas if we also do the UX research, etc.). We keep this updated, track against it, and make sure everyone is keeping it current.
• Comps: We keep a list of comparable projects we’ve worked on. If we are bidding a website, we can look at our comps that range from $15,000-250,000 and compare the potential project to one we’ve already done to know if we are in the right bid range.
• Overview of work: (Sometimes called a Statement of Work or SOW, pronounced as each letter, not as a big pig.) The overview is a numbered list that outlines everything we will do.
• Bid sheet: We use a Google Sheet to list tasks for this project (based on the overview of work), estimate time, and add all the numbers up. We also include our project management fees (5% of the total project) and other costs (like photography or language translations) so we have a complete picture.

Once we have all of this, we fill out a proposal template and send it off.

Contract review

The final thing you should spend some time on is reviewing each of your contracts and making sure all the factors of working with the client are defined clearly. Our contracts include a long term sheet with a lot of legal language. We want everything explained upfront before we get into business with someone.

Types of contracts

We offer the following types of contracts:

• Ongoing reserved hourly: (preferred) This is work for hire, and the client owns everything we produce. Well suited for ongoing work or deep UX and digital product projects where deliverables can shift.
• Proposal of estimate: Our answer to a fixed bid request. We always strive to hit the number. These include copyright transfer but are not work for hire.
• Managed hosting: For clients who want us to manage and host their websites so we can take care of security, updates, backups, and all of that.
• Jump start: 10–20 hours to kick off a client relationship and start working together with a lower commitment from both sides.
• Pro bono: Work done for free for nonprofits, friends, etc.

Three important clauses for design contracts

You don’t usually see these clauses in off-the-shelf contracts, but we’ve been in business for a long time and have a great lawyer to make sure we’re protected. The official language is much more legal, but this is the plain-English version of three of our clauses:

• Team: We once built a site that was highly dependent on the photography we received. The client’s photographer was a friend of theirs and did not deliver work we could use. In a case like this, this clause allows you to call in your best photographers (or other consultants) on the project.
• Promotion, Confidentiality: This states that we may use the client’s project in our portfolio. Occasionally you will meet clients that want you to keep the work you have done secret. Your ability to get work is only as good as your last project—never negotiate away the ability to show off your work without being compensated. If you do agree to keep it private, you should get a hush fee. For us, it’s 25% of the overall project, and we have charged it many times. We do negotiate that clients can approve any materials that are shown publicly (they have 15 days to say yes or request redactions, or it’s automatic approval). We don’t want to give away secrets, but we do want to stay in business.
• Location: We perform services remotely, but if the client wants us to work at a client-designated location, we will charge additional fees. Our offices are set up for maximum comfort and efficiency. We’ve worked on-site for clients a few times, and if we have to commute, set up in a different location, and play by someone else’s rules, we want to be compensated.

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