Why is it so hard for salespeople to make quota? They don’t understand “Deal Time.”

The title of this post leads you to believe that we are going to talk about time to close a deal or to make a deal. In this case I want you to think about time as a precious commodity that is fleeting and beats us every year: your finite amount of time to make quota. As the year begins with kickoff and planning, Q1 is over before we know it and Q2 is upon us. We quickly need to make up for the Q1 shortfall, which means we must double down on prospecting and get appointments that lead to follow-on investment by the customer.

Let’s define “Deal Time“ as the amount of:

Time you have to make quota – the time you waste working “no decision“ deals = Deal Time


How much time do we really waste?

If you are looking at 20 selling days per month times 12 months a year you only have a total of 240 days or 240*8 hours/ day which equals 1920 hours. Of the 1920 hours you have to make quota, let’s agree that 50% is taken up by administrative tasks, business planning, business reviews and activities like doctor’s visits and family commitments. That means that 1920/2= 960 hours that we have to actively sell in order to make our number.

Since 80% or 8 out of 10 of the deals you work on go into no-decision buckets, that wasted time means that you lose an additional (960*80% = 768 hours).  So in the end, your productive Deal Time is 960-768= 192 hours. This is a wakeup call for those of us in sales! When you know that you only have 192 hours, you better be aware of the finish line. What we find is that salespeople who understand this are consistently over quota and others are not. Those who are often over quota are expert qualifiers and have the “Deal Time “ clock running in their heads at all times.

Knowing this, you need to make an adjustment in your process to really maximize the time you have available and to quantify the deals in your pipeline to weed out no-decision deals quickly. Imagine if you could weed out just 2 of the 8 that are lost to no decision! You would add 18% more Deal Time to your 192 hours or 38 more hours to find another deal or close the others faster.

The difference between people who make quota and those who do not centers on time management. Those who understand how to qualify up front and trade their time for that of the prospect are much more effective. In order to maximize our deal time, we must create a sense of urgency on the part of the prospect that they are in it with you to win. We have to ensure they have some “skin in the game” and that they recognize the value of the resources you are providing. In this way, your prospect comes to recognize that you are committed to a successful outcome and closure of the deal so that they will be, as well.

Every time you decide to go on a sales call do this simple test if I have a $1M quota and 192 good hours to make my number every hour I spend with a client better return me $1M/192 hours=$5,208 /hour when the deal is closed.  This will be a major shift in your thinking.

Evaluate and optimize your time

Once you recognize the value of your time, you can begin to evaluate the value and ROI of each resource you are providing to the client. For example, what is the real value of a demo? Consider a recorded demo costing you and your customer 20-30 minutes; if the loaded cost between you is $100 / hour then the recorded demo cost you each $50 to deliver and qualify them. While the recorded demo may not be as good as an in-person version, it does allow you to test this activity as a component of “DEAL TIME” based upon their interest in watching it.

As a next step, they may ask for a custom demo and may even ask you to model their process in your tool. Before you agree to this get a requirements document written by them as to the specific items they want to see. Remember the idea around “DEAL TIME” is to bargain for more of their time to keep testing their commitment. Once you agree to do the demo, you recognize that it will take an account executive 3-4 hours of preparation and approximately one hour of your combined time to demonstrate it. If the account executive’s time is $100 /hour X 4 plus another hour of your time + the prospect’s time, that means 1 hour X $200 and you have now sunk in $600 of your company resources into this demo while the client only spent an hour to compile requirements and an hour to review the custom demo. At this point, you are unbalanced with a $600 investment on your end to their $200. If your deal is taking more of your time than theirs, don’t be shy to ask for more from them. 

While this kind of assessment may seem tedious, those who are effective time managers understand the importance of evaluating where their time is best spent. If your activities are dragging you away from deals that could close, you want to make sure you are not wasting your precious “DEAL TIME” on no-decision deals; the prospects who cancel meetings, don’t return your calls and block you from getting to power in the account. Spend your time prospecting and networking to find a good deal rather than wasting your time pushing boulders uphill.

How do you score your deal to determine if it's viable or not? Read our blog post on Negotiating Your Deal: Build a High Value Trades (HVT) Roadmap and download our tool.