What’s your business model? Is it a high volume, small deal size business? Or is it a low volume, large deal size business? It really has to be one or the other. It’s really hard to fall in the middle or do a bit of both. How many medium volume, medium deal size businesses do you know? How many that have a bit of both?

High volume businesses rely on great metrics, reliable conversion rates, and a constantly full pipeline so that the army of small deals makes a big total. Low volume businesses face a lumpy, more unpredictable sales chart but when the deals come in life is good, until the next big deal.

You could argue that the best business model is a blend of all three, so that you’ve got a pipeline of big deals, middle deals and small deals. Getting the blend right, however, is a tall order, especially when you bear in mind that different deal sizes are usually subject to different groupings of buyers, different sales processes and different sales cycle lengths. Hmmm, you need to be a pretty sophisticated and well practised sales organisation to make that work.

I’ve seen a number of organisations with a volume business model who haven’t done the maths to figure out how much sales and marketing they need to do to create enough leads, to create enough pipeline and so on. When they do, it makes for a pretty sobering meeting. Then there are the companies with a large deal business model who don’t know their sales cycle length and so don’t know how long they need to go between deals.

Whatever your business model, if people don’t have a genuine need for your product, or if you have to evangelise and educate in order to create the need, you have an uphill struggle.

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