One of the keys to gym sales success is pipeline management.
A sales pipeline (or funnel) will have a certain number of leads entering that will product or result in a predictable number of sales flowing out the other end.
Pipeline management is dependent on knowing 3 things.
1. Your historical conversion rate
2. Your number of active leads (MTD)
3. Your sales target
By knowing these 3 elements you will have the ability to see into the future with a high degree of accuracy.
Another important element is time to sale (in other words, on average how long does it take leads to join)
For simplicity, we will leave this out of the equation as we can get a strong indication from the above metrics.
Let's look at this example.
If your gym has a historical conversion rate of 53% and you have generated 139 leads for the month (By the 18th of the month).
On average you are generating 7.72 leads per day and on track to generate approx 240 leads for the month (7.72 x 31 days).
Based on our historical conversion rate of 53% we can estimate we are on track to acquire 127 new members for the month.
If our target is 130 new members for the month we know we are going to be close to hitting our target.
This simple calculation can help us monitor if we are on track for the month.
BUT - Won't some leads not make a decision until the following month? Yes, but this averages out as leads from the previous month will spill into the current month. It doesn't have to be "centimetre perfect", we just need an approximate measure.
Let's look at another example.
If your conversion rate is 63% and you have generates 72 leads for the month and its the 22nd of the month and if your sales target is 90 new members.
Your projected number of leads for the month is 101.45 and your projected sales for the month is approx 64.
In this scenario, I can see we are behind our schedule and we need to have a big last week of the month.
In this case, I could make sure our frontline team or dedicated salesperson (if you have one) spend more time on follow up to try and bridge the gap.
The important thing in sales management is to keep your finger on the pulse. You should be looking at your leads generated for the month daily or at worst case weekly as this allows you to correct things if they go off course before it's too late.
In gyms, often proactive team activity and behaviours can erode slowly over time so keeping your finger on the pulse is critical.
A professional manager will never be hit with a nasty surprise of missing their sales target because they are constantly monitoring their sales pipeline.
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