Explain Sales Cycle Stages

The sales cycle stages are the steps required to close a sale with a customer. The duration of the sales cycle is closely watched to see if a sales department is effectively using its time to close deals.

The stages in the sales cycle are as follows:

  • Understand the product. A salesperson must not only understand the features of a product, but also how it relates to a customer. This means understanding goods and services from the perspective of the customer, and being able to clearly state how they can provide a benefit to the customer.
  • Search for new customers. The salesperson needs to understand which target market will yield a high proportion of prospective new customers that will purchase a sufficient amount of profitable products to make the prospecting task effective. Once the best market is located, a cost-effective means must be used to contact all prospects, and then to winnow them down to a small set of qualified leads. If the salesperson is not judicious about how these tasks are handled, he or she could waste a great deal of time searching for new customers.
  • Assess customer needs. The salesperson’s goal is to learn about a customer’s situation. This calls for a large number of probing questions, and taking notes about all key items found. This information-gathering process not only results in great detail from which a presentation can be crafted, but also leaves a customer with the impression that the salesperson is really interested in his or her situation.
  • Conduct a presentation. Tailor a presentation to the specific benefits that a customer will experience. This means avoiding a discussion of “bells and whistles” and general lists of features, and instead using the salesperson’s knowledge of the customer’s needs to highlight what really matters to the customer.
  • Meet customer objections. A customer may have a number of reasons why the product is not a good fit. If so, the salesperson must be able to discuss offsetting reasons why the customer should make the purchase. Ideally, all objections should be fully addressed, so that there is no real reason why a customer would not make the purchase.
  • Close the deal. The salesperson must ask for the sale. If the next step in the process is left to the customer, then the sale will quite likely die, so the salesperson must push the process forward and actively complete the sale.
  • Follow up with customer. The salesperson should routinely contact customers to learn about their ongoing needs. Now that a relationship has been established, it is easier to delve into additional needs and explore opportunities for additional sales. It is much easier and more effective to follow up with existing customers than to prospect for new ones.


Depending on the nature of a sale, the preceding stages may need to be expanded upon or compressed into a smaller number of stages.

The problem with the sales cycle stages is that there is no focus on the underlying profitability of a sale. Instead, the focus is simply on completing a sale, irrespective of its profitability. This can lead to a situation where sales are rising while profits are falling.