Sales Pipeline Stages and Management: The Ultimate Guide

Sales Pipeline Stages and Management: The Ultimate Guide

A thorough and effective sales pipeline streamlines your sales process and allows your sales team to visualize where all potential customers live in the buying process.

Keeping your pipeline healthy and controlled will boost sales velocity and revenue outcomes.

Think about it — if it takes three weeks for any given deal to make it through your sales pipeline instead of four, then by the end of any given period, you’ll have closed 33% more deals. The key is building out a successful pipeline and consistently managing it.

Although every company has its own process that works best for them, in this article we will cover the basics of what a sales pipeline is, the fundamental steps required, and how you can best manage your pipeline. 

What Is a Sales Pipeline?

A sales pipeline is the sequence of steps that sales reps lead a prospect through from the beginning to the end of a sale — the pipeline helps to visualize where prospects are in the sales process. A sales pipeline helps your sales team identify which stages need more attention so your team can focus on improving those stages to increase sales velocity.

Your pipeline also helps forecast results and revenue by viewing which stages the prospects are currently in and how many will make it through the pipeline by a given time. 

chart-barAccelerate your pipelineTools to take action & data to make decisions

Sales Pipeline vs. Sales Funnel

Two commonly confused sales terms are sales pipeline and sales funnel.

The sales funnel is a visual representation of the journey that customers go on with your business. This also helps businesses measure the conversion rates of each stage.

So although both terms represent the buyer’s journey, the sales pipeline is from the point of view of the sales rep: the sales team’s process of turning a prospect into a customer. Where the sales funnel is from the point of view of the buyer: the journey the prospect goes through with a business before becoming a customer.

Here’s a quick breakdown of the sales funnel stages:

  1. Top of the Funnel: this is where customers become aware of your business. They might be looking for a solution for a problem they have and come across your product or service while carrying out their research
  2. Middle of the Funnel: this is where prospects become leads. They like what they see but they aren’t yet ready to invest in you just yet
  3. Bottom of the Funnel: this is where leads are ready to become customers

Here’s a great visualization to help align your sales funnel with your pipeline stages:

sales funnel stages and sales pipeline stages

What Are the Main Stages of a Sales Pipeline?

Now, let’s look at the main stages of a sales pipeline.

The main stages:

  1. Prospecting
  2. Qualifying
  3. Demonstrate
  4. Proposal
  5. Closing

Sales Pipeline Stages Infographic

Sales Pipeline Stages

1. Prospecting

The pipeline begins with Prospecting (or Lead Generation).

Prospecting is the process of identifying potential customers that your product or service will benefit, and then systematically communicating with them. Lead Generation is the process of attracting and engaging prospects through marketing activities such as campaigns, events, and content marketing.

Tip: Here are 7 techniques with email templates to help you get to “yes” faster.

2. Qualifying

Before taking the prospect through the pipeline, make sure they’re a good fit. Through research and conversation — dig into their pain points, buyer persona, company size, budget, etc. This will also help establish who your high-value prospects are and prioritize deals based on the likelihood of them leading to a sale.

A sales technique for qualifying your leads is through BANT. This is a formula used to determine whether it’s the right time to sell to a prospect and helps to separate hot deals from time-wasters through a series of questions. 


3. Demonstrate

This is where you demonstrate the product or service to the prospect to make sure it resonates with them.

This will differ according to your product or service, but it’s important to demonstrate all the features and capabilities, emphasize the advantages of implementing your solution, handle any objections, and answer all questions.

4. Proposal

Once you’ve qualified the prospect and demonstrated your solution, your proposal will be much easier to personalize and tailor to the specific prospect.

Your proposal dives into the details of your solution such as price and length, all while staying personalized and directed towards their pain points and why your product or service will benefit them specifically.

Here are some fundamental elements to include in your proposal:

  • Executive summary
  • Personalization
  • Outcomes
  • Pricing
  • Next steps
  • CTA

5. Closing

Whether the prospect becomes a customer or you lose the deal, closing for both is important. If you’ve won the sale — follow up, get them the paperwork they need, provide onboarding steps if necessary, and make the transition as smooth as possible. If you have lost the sale — do your best to maintain a relationship for the future, ask for feedback, and reflect.

Tip: Once the sale is closed, salespeople can still follow up with the customer to make sure they’re happy. This helps with loyalty but also remaining in contact with the customer for future sales. Loyal customers can come back to the sales pipeline by repurchasing additional products or services such as upgrading their accounts. 

databaseClose deals fasterAlways know what is/isn't working to accelerate results

Sales Pipeline Management

1. Keep Your Sales Pipeline Healthy

Always keep track of your sales pipeline and monitor its growth and health. Your pipeline should always be growing or at least staying consistent with new deals leaving and entering simultaneously.

Another indicator of a healthy pipeline is to consistently have prospects at every stage. Make sure these opportunities maintain momentum — don’t let a good lead slip through the cracks!

2. Prioritize Top Deals

Monitoring the length of the deal to estimate the closing period can help with prioritization and sales activities. Certain deals move through your sales pipeline differently than others. And some deals you need to prioritize.

A tip is to have certain qualification criteria for each stage to determine the top priorities you need to work on first. If you’re consistently monitoring your pipeline, you’ll begin to understand patterns of length and likelihood of dropping depending on the kind of deal.

3. Drop Deals That Aren’t Progressing

Deals that aren’t moving and are stuck at a particular stage are in most cases not likely to make it through the pipeline. These are a waste of time — so make sure to clean up your sales pipeline regularly to avoid clutter.

When a prospect is at a standstill, either decide to remove them or focus on picking up momentum with this particular deal. A key indicator is if they’ve surpassed the average sales cycle length.

4. Monitor Pipeline Metrics

Monitoring your metrics is a key indicator of the growth and progress of your sales initiatives. Focus on metrics that indicate pipeline health such as the number of deals in your pipeline, the average lifetime of a deal, the average size of deals, and the percentage of deals that make it through the pipeline.

It’s also important to monitor your pipeline to identify opportunities or areas in the sales process that need improvement. Your sales pipeline can also indicate barriers and identify blockers that your sales manager needs to address.

5. Reflect and Improve

Which sales techniques are working and which are not? 

What stages are taking longer than others? 

It’s important to regularly review your pipeline and the progress of your sales team. Indicate barriers and what is slowing down the momentum, then work on and improve your sales techniques accordingly.

Yesware Best Practice:

Yesware syncs your email and calendar activity automatically so that you no longer need to manually input your messages into Salesforce CRM. With our activity dashboard — you can compile this data into informative reports to help forecast your sales and keep your pipeline activities accurate. These centralized dashboards help managers understand how sales activities are contributing to the pipeline and what to work on with the sales team.

Activity Dashboard in Yesware

Curious to try? Automate your sales process today (free trial).

Establish and Execute

Establish your pipeline, execute, measure, and reflect.

Your sales pipeline is essential for growth in not only your sales team but your business as a whole.

Establish what each stage of your pipeline entails and your team’s plan and techniques for each. Use the data and metrics your sales pipeline provides to improve your sales process.

From prospecting to closing — keep the stages in a sequence and maintain a process-oriented visual sales dashboard of your pipeline to avoid any opportunities from slipping through the cracks.

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