Definition – What is a Sales Cycle?

Have you ever wondered how long you should wait before following up with a potential customer? Following up too soon might make you seem pushy or unprepared. However, if you wait too long then you might miss the opportunity for a sale altogether.

Many people who are in sales have faced this dilemma at some point which is why the sales cycle exists.

80% of sales require 5 follow-up calls after the meeting. 44% of sales reps give up after 1 follow-up.

— Brian Williams

A sales cycle refers to the series of events that takes place from the moment a salesperson first engages with a prospect up until the moment when the sale is made. Most businesses want to shorten the sales cycle as much as possible but this can only be done once they fully understand each step of the process first.

The 7 Stages of a Sales Cycle

Having a well-managed sales cycle is important for the health of your business. It will give you a clear idea of where you are at each stage of the process and what challenges you will have to deal with along the way.

Regardless of the product you are selling, every sale will follow a basic format. Rarely will a sale occur that does not involve these seven steps.

It is important to master each of these stages and learn which areas you are weak in.

• Prospect

The first step is simply to find new prospects. This is a critical step because without prospects you will have no one to sell your product to.

Sometimes your company will give you a list of leads to work with but often you will be responsible for finding them yourself. A good way to begin prospecting is to determine who the ideal prospect for your business is. Figuring this out will make it easier for you to find ways to approach this person.

• Initiate contact

The way you initiate contact will largely depend on the industry you are in. The first contact will usually happen when you call or email your prospect to set up an appointment.

It is a good idea to start by offering support or useful information on the first contact.

• Identify the customer’s needs

When you meet with your prospect you will need to come prepared with the right questions and resources. That way you can discover what it is your prospect truly needs and whether or not they are a good fit for your company.

This will help you figure out whether or not they are willing to try out your product before you spend a lot of time trying to pitch them.

• Present an offer

Your offer should serve as a solution to meet your prospect’s needs. You should use the information you have already gathered when you are presenting an offer to your prospect.

It’s important to keep in mind that you are representing your company. So you aren’t just selling your product, you are selling yourself and you want to make a good impression.

• Manage objections

Your ability to manage any objections, such as price, will largely determine whether or not you are able to close the sale. Remember that objections are actually a positive sign because it shows that your prospect is considering your offer.

• Close the sale

Once you have made your offer and answered your prospect’s questions it is time to close the deal and ask for the sale. This is actually the most frequently skipped stage which is ironic considering it is the most important. Mastering this difficult stage takes both time and experience.

• Ask for referrals

Set up a follow-up process so you can make sure your customers continue to be happy with your services. Not only will this lead to future sales but it will bring in referrals for new leads.

Why Do You Need a Sales Cycle?

A sales cycle gives you a template for what action you should be taking at each point in the sale. Every prospect should be approached differently because they are all in different stages of the sales cycle. When you understand where each prospect is in the sales cycle you can refine your message for that particular person.

Your sales cycle will also offer insight into how efficient your business’s sales operations are. The length of your sales process can be tracked and compared to the industry average.

For instance, let’s say that your company’s sales cycle is shorter than the industry average. This could mean that your company’s sales department is performing more efficiently than most of your competitors.

This article in the Harvard Business Review shows that companies with a formal sales process generated 28 percent higher revenue growth. These companies had a clearly defined sales process, spent at least three hours a month managing their pipeline, and they trained their sales managers on how to manage their pipeline as well.

Using a CRM to Measure the Sales Cycle

Now you understand what the sales cycle is and what each stage involves. But you may be wondering how you are supposed to manage all of this and how to teach your employees to implement it.

One solution to this problem is a Customer Relationship Management (CRM) system.

A CRM is software that allows you to manage your interactions with your prospects and customers. It also gives your employees a template to follow throughout the sales cycle and offers management a high level of oversight.

You can monitor how your salespeople are performing, which stages are losing the most customers, and how different prospects are converting.

This article in Forbes shows that companies with a fully utilized CRM system boosted their sales by 29 percent. Here are some other benefits to using a CRM system:

• Evaluate your sales cycle

A CRM will guide you through each step of the sales cycle and track your progress. This will help you identify any trends in the sales cycle and spot potential problems before they occur.

• Measure performance

You can track how each employee is performing and identify any areas where improvement is needed. For instance, if an employee frequently loses the sale during a certain stage, the CRM will show you this.

• Predict your incoming revenue

Since your CRM will track where each sale is in the cycle, you have a better idea of your chances for success and future revenue.

Most business owners understand that a faster sales cycle is preferable because the longer a sale drags on the higher the likelihood that it will fall apart.

By understanding the different stages of the sales cycle you will close more sales and manage your employees more effectively.

A CRM can be a helpful tool to help you identify what is and is not working in your sales cycle. There are many times when “trusting your gut” is a good idea but when it comes to managing your company’s future revenue it probably isn’t the best strategy.

Tallyfy offers a simple workflow and business process management tool to help you track your progress and problems. Our app will trigger workflows from your CRM for a smoother, more seamless process. You can gain insights on existing bottlenecks so you can continuously improve your processes. Visit our features page for more information or schedule a chat.

Related Questions:

What is the definition of a sales cycle?

The sales cycle is the customer’s path from first touch to purchase. After spending time obsessing over workflows in Tallyfy, I believe it should be more like an orchestrated dance than a stiff funnel.

Every interaction is an opportunity for trust to build or break. What’s interesting is how industries develop their own choreography, some graceful and effective, many much more baroque. This is where the magic happens to simplify this dance.

How long is a sales cycle?

Sales cycles are great unpredictable beasts! I’ve seen B2B software deals close in 10 days (rare unicorns) and others linger for 14 months.

Your product complexity and price point and the decision structure of the customer all play into it. The real trick isn’t so much making it shorter — that is of course important — but making it predictable enough for your team to be able to forecast accurately.

In general, predictability trumps speed.

What are the 7 stages of the sales cycle process?

The classic 7-stage sales cycle reminds me of a video game where each level unlocks the next: Prospecting (finding potential fits), Initial Contact (breaking the ice), Needs Assessment (uncovering pain points), Presentation (demonstrating value), Handling Objections (addressing concerns), Closing (sealing the deal), and Follow-up (nurturing the relationship). What’s captivating is how automation enhances—rather than replaces—human touch at each stage.

How do you calculate sales cycle?

Calculating your sales cycle is delightfully simple — for each deal, you subtract the first contact date from the close date, and average them.

The most enjoyable part, which is where my inner data nerd comes out to play, is slicing by deal size, product type, or lead source to find hidden patterns. One I recently worked with discovered their “60-day average” was actually two independent cycles: 20 days on reorders and 90 for new business.

This insight transformed everything!

What is the difference between sales cycle and sales process?

The sales cycle mirrors the customer’s buying journey, while the sales process is an internal playbook for your sales team. This distinction is not merely semantic — it’s transformative.

The most effective teams I’ve worked with at Tallyfy design their processes around the natural buying cycle of the customer, rather than forcing customers into a system that works best for their own operations.

When those two things align just right, selling becomes less about forcing and more about guiding.

How can I speed up my sales cycle?

Do you want to shorten your sales cycle? Be unrelentingly ruthless about qualification.

I’ve seen companies burn months on leads who were never going to buy. Create self-serve resources for the most common questions, automate your follow ups (but in a personal way!), and — this saved me so much time — be upfront about pricing on the front end.

Sometimes the fastest route isn’t doing things faster but cutting out steps altogether. Less really can be more.

How to improve your sales cycle?

The first step in improving your sales cycle is to map it end to end in a workflow software tool. Identify where deals routinely get stuck—those bottlenecks​ are diamonds in the rough opportunities for improvement.

Our team found that prospects got trapped in evaluation, because our demo process was overly complex. We made it easier and closed 24% more.

Often, the better enhancements are the ones in which we remove the friction instead of having to add more activities, touches, touchpoints, et cetera.

Why Is the Sales Cycle Important?

The sales cycle is the lifeblood of business predictability. Without it, you are effectively blind on revenue projections and resource planning.

The reason I care deeply about this at Tallyfy, is because visualising the cycle helps to turn random, chaotic sales approaches, into systematic, measurable processes. It takes the conversation away from the general “Why aren’t we closing more?” to the actionable “What stage precisely requires optimization?

How to Create Your Sales Cycle Process?

Don’t impose your ideal, instead observe reality to create an ideal sales process. Assemble what your best customers did before they purchased. A great way to do this is to interview your stars about how it works.

Then create a lightweight process that mimics this natural flow. The mistake I often see? Designing too stiff processes that sales teams simply ignore.

Your process should feel like a butler, not a boss—helping, not horrifying.

How to Measure Your Sales Cycle?

To effectively measure your sales cycle, track three metrics: average length, stage conversion rates, and velocity (how quickly deals move through each phase).

But averages can be deceptive! I discovered our “typical” 45-day cycle actually masked two distinct patterns—20-day cycles for small deals and 85-day cycles for enterprise.

Separating these revealed entirely different optimization needs than the misleading average suggested.

What to do to shorten the Sales Cycle?

So, if you want to shorten your sales cycle, be obsessive about removing friction. Motivate deals while your team sleeps with workflow automation software Anticipate and address objections before they are raised.

And here’s a bit of counterintuitive advice: sometimes a slowdown in the early stages due to better qualification actually speeds up overall cycles by weeding out time-wasters who would never end up buying anyway.

What does Tallyfy believe about sales cycles?

At Tallyfy, we believe that sales cycles are really just workflow issues masquerading as deals. Most CRMs are designed to record what was done rather than what needed to be done next in sequence.

We believe that predictably successful sales comes from well-designed workflows rather than from individual heroics. We love getting rid of those “What’s the status?” over manual check-ins — and every sales manager’s nightmare — with automated, real-time visibility into the progress of every deal.

How does the sales cycle relate to the real-world?

Nothing illustrates the reality of sales cycles like hearing from people who’ve transformed theirs:

“We were all very surprised at how quickly our clients became comfortable with using Tallyfy.” – Michelle Murray, Managing Director / CPA at Segue Partners

“This is the key to business growth. I don’t have to spend a lot of time training freelancers. There’s a ton of applications for it in sales and other such processes, but I’m especially excited for the ability to hand-off tedious workflows that I don’t want to have to explain to someone else again and again.” – Kyle Lawrence, Development Manager at Design & Develop

These real-world experiences show how proper workflow management directly impacts sales effectiveness. See more customer stories at /customers/

How can a sales manual software help optimize the sales cycle?

A perfectly templated sales manual software not only documents your process but activates it. Our static sales playbooks gather digital dust because our interactive ones catapult reps through every step of the process.

Everything clicks into place when your best practices on paper direct your team’s next exact actions. Your manual cycles time swiftly fall and diminish, whereas continuity goes through the roof.

Glossary of Terms

Sales Cycle

The complete sequence of steps that a company takes to sell its product or service to a customer, from initial contact through closing the deal. This process typically includes prospecting, initial contact, needs assessment, proposal, negotiation, and closing.

Sales Cycle Length

The average amount of time it takes to complete a sale from the first point of contact to closing the deal. This metric helps organizations understand and optimize their sales process efficiency.

Sales Pipeline

A visual representation of where potential customers are in the sales cycle, showing all sales opportunities and their stages, helping teams track progress and forecast revenue.

Sales Qualification

The process within the sales cycle of determining whether a prospect has the budget, authority, need, and timeline to make a purchase, helping sales teams focus their efforts on the most promising opportunities.

Sales Velocity

A measure of how quickly leads move through the sales cycle, calculated by considering the number of opportunities, average deal value, win rate, and length of the sales cycle. This metric helps teams understand how quickly they’re generating revenue.