reduce time to close
- Reduced cost of sale, increased profitability
- Increase in # of manageable oppertunities per sales rep per year
- Improved loyalty
Let’s say that the average time to close the sale of a particular product for a particular channel partner is 120 days, which you would like to improve (decrease). Or alternatively, that you want to improve (decrease) time to close for a particular deal size range.
Determine the product for which you want to improve (decrease) time to close. Step 1 (alternative): Determine the deal size for which you want to improve (decrease) time to close (say, between $75K and $125K).
Determine the partners or group of partners which you want to include in your time-to-close incentive program – for example, all Gold partners, Silver partners in Europe, or partners of a particular size (say, between $10 million and $50 million in revenue).
Pick a baseline time period. You need a time period as a baseline for measuring time-to-close performance improvement – for example, last quarter (vs. this quarter), same quarter last year (vs. this quarter), or last year (vs. this year).
Determine how many points to award a partner for decreasing their time to close w.r.t. the baseline – for example, 10 points for each day less than the baseline.
Calculate the baseline time to close for each partner as the average for all closed opportunities in the baseline period: (A) Opportunity closed date – Opportunity registered date.
Set up your outcome rule. For every new opportunity that closes, calculate the time to close for each new closed opportunity: Opportunity closed date – Opportunity registered date. If B < A, allocate 10 points times A – B (10 points for each new opportunity that closes faster than the baseline).
Decreased time to close – Sometimes the key to boosting revenue production is to reduce the time channel partners are taking to close deals. Equipping and incentivizing them with the right tools to become more sales-efficient can pay big dividends (as well as engendering their loyalty).