I saw this question raised recently in a sales forum and it seems that the answer should be obvious. But to many salespeople that’s not the case. Now that CRM and SFA systems are getting more common it’s becoming more important to enter start dates and to try to get them right. The real problem is that unless you have a consistent, realistic estimation of when the sales opportunity begins, you can’t do any reliable analytics on how long it takes to sell something. Getting the whole team to abide by the same definition is very difficult.

Back to the forum. The question was:
“What do you consider the start of the sales cycle? For instance, we have a Sales Development Team and Account Executive Team. Our Sales Development Team will outbound call/email out to a pool of ~10,000 potential prospects (cold) and schedule demos for our Account Executive team. Would you consider the sales cycle to have started at first contact? when the demo is scheduled? or when the Account Executive holds the demo?”

In this case, a call from inside sales is the first “touch point” to the customer. The sales rep probes to find possible fits of products to the prospect’s business issues, and if there are, the “lead” is passed on to an account rep who tries to develop a sale.

It’s best to think of the customer’s buying process. Buying and selling are interactional activities – one depends on the other. The natural flow of activity in the sales transaction, from start to finish, follows a parallel cycle in the buying process.

In the situation above, the inside rep should establish where the customer is in the buying cycle. Are they already in the process of buying? Perhaps they are not. If the first contact establishes that the prospect is actually in a buying cycle, then the sales cycle has begun. A sales opportunity gets logged, the account rep gets advised and the next step is planned.

The prospect contact may not have a current plan to buy but could be intrigued enough by the inside rep’s proposition that a buying process could be started. But it is likely that another qualifying call will be needed for confirmation. This lead is hot and the sales rep is actually on the way to creating a buying cycle with the customer.

There may be no intention that a buying process has started, in which case there is no sales cycle. Put the contact into a category that gets chased by marketing in the future. This is called a long-term, and the CRM system will remind you when it should be followed up again.