How To Calculate Pipeline Velocity in Excel or Sheets

Introduction

Calculating pipeline velocity is a crucial metric for sales teams to track their progress and identify areas for improvement. It measures the rate at which deals move through the sales pipeline, from initial contact to closed won. A high pipeline velocity indicates that the sales team is efficient at moving deals through the pipeline and closing deals quickly.

Why it's important

There are several reasons why calculating pipeline velocity is important:

• It helps you track your progress: By tracking your pipeline velocity over time, you can see if you are making progress towards your sales goals.

• It identifies bottlenecks: If your pipeline velocity is slow, it can help you identify bottlenecks in your sales process that are slowing down deals.

• It improves forecasting: Accurate pipeline velocity can help you make more accurate sales forecasts.

• It motivates your sales team: Tracking pipeline velocity can help motivate your sales team to close more deals.

How to calculate pipeline velocity in Excel or Sheets

There are two main ways to calculate pipeline velocity in Excel or Sheets:

• Method 1: This method uses the following formula:

Pipeline velocity = (Total value of deals closed won in a period) / (Average time spent in the pipeline)

• Method 2: This method uses the following formula:

Pipeline velocity = (Number of deals closed won in a period) / (Average sales cycle length)

Using the formulas

To use the first formula, you will need to track the total value of deals closed won in a period, as well as the average time spent in the pipeline. The average time spent in the pipeline can be calculated by dividing the total time spent in the pipeline by the number of deals in the pipeline.

To use the second formula, you will need to track the number of deals closed won in a period, as well as the average sales cycle length. The average sales cycle length can be calculated by dividing the total sales cycle length by the number of deals in the pipeline.

Tips for improving your pipeline velocity

Here are a few tips for improving your pipeline velocity:

• Qualify your leads: Make sure you are only qualifying leads that are a good fit for your product or service.

• Shorten your sales cycle: Look for ways to shorten your sales cycle, such as using a CRM system to automate tasks.

• Improve your sales process: Identify and remove any bottlenecks in your sales process.

• Train your sales team: Make sure your sales team is well-trained on your sales process.

Calculating pipeline velocity is a simple but effective way to track your sales progress and identify areas for improvement.