What is a sales cycle? Definition, stages, and importance

A well-established sales cycle is the cornerstone of a successful sales practice. For sales reps, it provides a strong framework for next steps, lead prioritization, and a more cohesive deal-closing process. At the same time, sales leaders and managers use sales cycles to evaluate their team's efforts and modify the sales process for better performance.

However, creating and managing a successful sales cycle can be difficult for already busy sales teams — especially if they aren't leveraging the right tools. Here, we’ll take a deep dive into the typical stages of a sales cycle, best practices from the sales experts at Outreach, and how proper sales cycle management backed by powerful software can improve your team’s overall sales efficiency.

What is a sales cycle?

A sales cycle is a clearly defined set of steps sales reps use to close deals. Sales cycle management refers to the processes and tools that sales leaders, managers, and reps use to track each stage within the sales cycle. When managed correctly, it provides teams with insights, trends, and areas for improvement. But more than just a series of steps, the sales cycle should be about aligning with your customer’s needs and ensuring a good fit at every stage.

An organization's sales cycle directly impacts sales velocity, a key metric that indicates how quickly deals move through the pipeline to generate revenue. A well-structured plan drives faster sales velocity and ensures that each sales cycle stage meets customer expectations, leading to more successful outcomes.

Why is the sales cycle important?

The sales cycle is vital to individual reps, sales departments, the teams with which they interact, and the broader business. Developing a clear sales cycle is an essential job of a sales manager. By setting expectations around deal stages, they can more easily assess the health of the deals in their team's pipeline and help deals move forward as needed. 

Without a well-defined sales cycle, each rep must rely on their best judgment when deciding which activities to execute. That makes it difficult for leaders to understand the efficacy of specific activities and the sales cycle as a whole. With those insights, teams can make meaningful improvements to optimize the sales cycle and shorten the time to close deals.

Sales cycle stages vs sales cycle steps

Before we go further, it's important to distinguish between two key concepts: sales cycle stages and sales cycle steps. While often used interchangeably, these terms actually refer to different aspects of the sales process.

Sales cycle stages represent the broader phases that a deal goes through from initial contact to closure. These stages are strategic, high-level, and typically consistent across an organization. Each stage has specific activities and exit criteria, making them valuable for sales forecasting and pipeline management.

On the other hand, sales cycle steps are the tactical, day-to-day activities that salespeople perform to move a deal forward. These steps are more granular and process-oriented, often varying between different salespeople or deals. They might include actions like making an initial phone call, sending a follow-up email, or giving a product demonstration. While stages provide a bird's-eye view of the sales process, steps offer a detailed roadmap of the actions required to turn leads into customers.

The 7 steps of the sales cycle

While each sales organization is unique and should tailor its sales cycle stages to its own specific needs and objectives, there are some common steps that most businesses follow:

1. Prospecting for leads

Before your sales reps can begin selling your products or services, they must identify and reach out to potential leads who fit the profile of an ideal buyer. This is vital for two reasons: It gets your business in front of prospective buyers, and it demonstrates that your team is both proactive and engaging. Since 71% of buyers say they want to hear from sellers early in the buying process, prospecting is a necessary part of any successful sales cycle.

Prospecting (also referred to as lead generation) can include a variety of activities, depending on your business, the products or services you sell, and the industry in which your company operates. Research into your competitors' techniques and the overall buyer landscape can help you determine if your team should prospect via cold calling, outbound emailing, LinkedIn messaging, or other promotional activities. As you get started, don’t be afraid to try out a few different prospecting techniques to identify which ones yield the best results for your team.

2. Contacting and connecting with leads

Once you've identified potential leads, you can start to make genuine connections using emails, phone calls, and even letters. It's best to personalize these interactions, as 31% of sellers say that sending one-to-one, customized messages is extremely effective. What's more, sellers have an average of 14 days to engage a buyer before it's too late, and the most successful reps reach out to buyers nine times across various channels within that window.

It should be mentioned, though, that this is not the stage at which salespeople should give a full sales pitch to their leads. This step is about creating a genuine connection with leads to open the door for a full pitch later on.

3. Qualifying through research

Not every prospect is fully qualified to buy your product or service. They might not actually be ready to make a purchase, have the proper budget, or have the authority to make purchasing decisions within their organization. Your product or service might not even be the right fit for the problems they're looking to solve, in which case a purchase could negatively impact your customer service and attrition rates down the line. That's why it’s essential to qualify leads through specific criteria and research early and often through every stage of the sales cycle.

Your qualification questions should uncover and verify details like:

• Whether or not the prospect’s budget is aligned with the cost of your offerings
• If your offering solves for the prospect’s pain point(s)
• If the person you’re in contact with is authorized to make purchases, or if they’ll need additional stakeholder buy-in
• Whether or not they are truly ready to buy

Without a qualification process, sellers risk wasting their time chasing buyers who won't — or shouldn't ever — end up making a purchase.

4. Presenting the solution (the sales pitch)

Presenting an effective sales pitch requires a great deal of preparation, as each client might respond differently based on myriad factors. Many companies have a standard sales pitch that reps adapt for each individual client to properly address their unique questions and concerns. 

Since 58% of sales meetings are not valuable to buyers, nailing down the pitch stage can become a key differentiator for your sales team. 

Prioritize a customer-centric approach during this crucial stage. This will help you:

• Communicate the value: Explain precisely how your product or service will benefit the customer.
• Foster collaboration: Work closely with the buyer by developing mutual action plans that demonstrate your commitment to their needs.
• Showcase expertise: Demonstrate your deep understanding of the buyer's market and industry challenges.

5. Handling objections

More often than not, potential clients will raise objections, which your reps will need to answer effectively in order to positively influence buyer decisions. This stage is sometimes frustrating, challenging, and overwhelming for salespeople, who must promptly convince the buyer that their doubts are unwarranted. It’s especially tricky for teams that still rely on a desk full of sticky notes or battle cards (e.g., a list of prompts or talking points to reference), as they're often messy, disorganized, and don't offer the in-depth support they need to handle objections. 

To manage performance and coach at scale, many sales managers rely on conversation intelligence software that listens to rep conversations and intelligently suggests content like competitive differentiators, product features, pricing, integration, and more in real-time so reps can knowledgeably answer prospect questions during live meetings.

6. Closing the sale

The time between the sales pitch and closing can vary greatly, especially in B2B sales. The average time to close depends on factors like company size, industry, and the number of decision-makers involved. After the initial demo, reps often schedule follow-up meetings to discuss product details, expected benefits, and return on investment. They may also need to present to a larger group of buyers. Throughout this process, remember to maintain regular communication through phone calls and emails to address questions and keep buyers engaged.

The amount of time between the sales pitch and closing can take months, depending on the customer's company size, industry, and decision-makers. Based on survey data from Outreach’s Sales 2024 report, the median sales cycle lasts around 120 days — and is even longer for businesses selling into larger enterprise accounts.

At this stage, there are two possible outcomes: the customer may negotiate your terms, such as price, scope of work, or delivery timeline. If negotiations are successful, you'll move toward closing the deal. However, if the customer is unwilling to compromise, it may be necessary to walk away. Your sales team should be skilled at negotiating confidently while also knowing when to cut their losses and avoid wasting time with a deal that won't materialize.

7. Following up and generating referrals

Even after you close the deal, your efforts shouldn't stop there. It’s crucial to follow up with your established customers in order to retain their business. And since increasing customer retention rates by just 5% increases profits by 25% to 95%, you likely can't afford to ignore this stage.

Create a sales cycle that includes a thorough follow-up process, where reps consistently and proactively check in with existing customers to answer questions, reevaluate their needs, and educate them on new or updated products. That way, your customers will know your business is a trusted partner on which they can rely for valuable solutions. A proper account planning strategy can help you better understand how well your offerings are meeting their needs and make any necessary adjustments.

Including referral requests in your follow-up process is also a great idea, which will help generate more business from your existing satisfied customers. Word-of-mouth recommendations are powerful drivers of new business. To help boost the odds of getting these types of referrals, ensure you're always providing excellent customer service and encouraging your clients to be vocal about their experiences with their peers. Even better? Try implementing a referral program where existing customers receive discounts on future purchases when they successfully recommend your business to a new client.

Sales cycle management: tools & techniques

When it comes to managing the sales cycle, there are a variety of tools and technologies that can provide valuable support for sales teams. These solutions often feature robust integrations, intelligent automation, and advanced performance tracking to enhance productivity and results. Some key areas where these tools can be beneficial include:

Prospect and manage accounts

Sales teams need a way to build quality pipeline by ensuring the right message reaches the right prospect at the right time. These tools leverage integrations and automation to improve sales productivity by helping sales reps grow, organize, and manage their book of business, uncovering every sales opportunity.

Manage and guide deals 

Effective sales tools can seamlessly integrate with other systems to help reps align with buyers and sell with confidence. By providing real-time data insights and deal tracking, these solutions guide every customer interaction to improve deal health and minimize risks to closing deals.

Coach and improve

The best sales tech stacks empower revenue teams to drive rigor and scale what works. Robust performance tracking, data-driven coaching, and sales training ensure teams continuously optimize their processes with automated best practice workflows.

Forecast and plan

Accurate sales and revenue forecasting, along with informed, achievable revenue planning, are critical for sales success. Advanced tools leverage data-driven insights, integrations, and automation to predict outcomes and build plans that set teams up for success.

Retain and expand

Finally, sales technologies can help turn customers into advocates through seamless onboarding, proactive engagement, and coordinated plays powered by integrations and automation. Effective customer lifecycle management drives adoption, mitigates churn, and expands accounts..

By leveraging the right mix of sales tools and technologies, teams can streamline their workflows, make data-driven decisions, and ultimately drive more revenue. The key is finding solutions that address the specific needs and pain points of your sales organization through robust integrations, intelligent automation, and advanced performance tracking.

How to shorten your sales cycle 

According to data from Outreach, the average sales cycle length is growing year over year. In 2023, the average sales cycle lasted around 117 days — up 20% from 2020. 

To face this trend head-on, revenue teams don’t need to pile on more disconnected tools; they need a system that allows them to design, measure, and execute repeatable workflows to drive sales performance and accelerate the sales cycle. 

A unified platform gives teams the ability to put the customer at the center of their business, capture rich insights, and continuously optimize each interaction. This allows them to streamline workflows, improve team accountability, and make data-driven decisions — all of which contribute to faster sales cycles and better revenue outcomes.

Best practices for optimizing your sales cycle

A smooth sales cycle drives results. Follow these simple best practices to keep deals moving and your team on track.

Start with the customer in mind

To optimize your sales cycle, design every stage with the customer’s needs at the forefront. To optimize your sales cycle, design every stage with the customer’s needs at the forefront. For example, during the prospecting phase, use tools like LinkedIn to research your lead’s challenges. Tailor your outreach message to show how your solution directly solves their pain points. This ensures a more personalized approach that builds trust and moves deals forward faster.

Continual improvement

Your sales cycle should never be static. Regularly review metrics like deal velocity and close rates to identify areas that need attention. For instance, if deals are stalling in the qualification stage, adjust your criteria or speed up follow-up times. Consistently tweaking your process keeps you competitive and responsive to changing buyer behavior.

Coaching your team

Coaching is critical for keeping your sales team at the top of their game. Schedule regular call reviews using conversation intelligence tools to highlight what’s working and where improvements are needed. For example, focus on handling objections better or improving pitch delivery. Targeted coaching like this boosts your team’s confidence and effectiveness at every stage.

The psychological aspect of sales 

Mindset matters. Experienced reps know that rejection isn’t a personal failure — it’s part of the job and a learning opportunity. Sales is a field fraught with rejection and setbacks, which means that mental resilience is a key factor in a rep’s long-term success.

To build resilience and motivate your sales team, start by taking care of their mental health. Encourage them to practice mindfulness, find a healthy work-life balance, and know they've got resources to lean on when things get tough. To win consistently, organizations need to flex both their operational rigor and team culture.

Common pitfalls in the sales cycle and how to avoid them 

Even the best sales processes can run into trouble. Avoid these common pitfalls to keep your sales cycle running smoothly and deals moving forward.

Identifying bottlenecks 

Sales cycles can stall if bottlenecks aren’t addressed quickly. For example, if too many deals are stuck in the negotiation phase, introduce automated follow-up emails to keep communication flowing. Using deal management software to monitor these choke points ensures your team can react quickly and keep deals moving. 

Before deals begin to slow down, make sure you’re looping in the right buyers. Multi-threading — the practice of engaging multiple stakeholders with decision-making power across multiple departments — has the potential to increase win rates by 56%.

Inconsistent follow-up

Many deals fall through because of poor follow-up. To avoid this, set reminders and automate follow-up emails to ensure consistent communication. For example, create a follow-up cadence in your email prospecting strategy to check in with prospects every three to five days during critical decision periods.

Inconsistent or incomplete lead qualification

Over-qualifying is a pitfall, but so is under-qualifying. Without the right qualification process, your team may waste time on leads that aren’t a fit. Introduce a standardized qualification checklist, like using the BANT framework (Budget, Authority, Need, Timing) or MEDDPICC to quickly identify serious prospects in a consistent way.

Ready to level up your sales cycle?

A well-defined sales cycle is a key ingredient to a productive sales team, better customer interactions, and positive revenue outcomes. To get there, sales teams need a platform that allows them to build, measure, and improve the workflows they rely on every day. That platform is Outreach. 

From automating repetitive sales tasks to consistently delivering actionable insights to your sales leaders, Outreach empowers your sales team to perform at their highest potential. To see what the full platform has to offer, take a self-guided tour — no form or sales pitch required.

Additional FAQs about the sales cycle

What is the difference between a sales cycle and a sales funnel?

The term sales cycle is often confused with the sales process. While closely related, the two concepts are distinct. The sales cycle outlines the specific, predefined stages a team uses to execute a deal, while the sales process refers to how those stages are carried out — like the methodology or approach your team follows.

How long should a typical sales cycle last?

According to touchpoint data from the Outreach platform, the typical sales cycle for Outreach customers was 117 days in 2023. A 2024 survey of over 500 sales professionals found similar reports — the median reported sales cycle reported was 120 days. But the length of a typical sales cycle can vary quite a bit depending on the size of the target accounts.

For mid-market and commercial accounts, the median sales cycle increases to 150 days. Even more striking, for companies targeting mid-market and commercial accounts in the $250M to $1B range, the median sales cycle is a staggering 408 days — over a year.

So, while the overall average sales cycle is around four months, it can increase substantially for larger enterprise deals, sometimes exceeding a year. Sales teams need to plan accordingly and set appropriate expectations with stakeholders.

How does the sales cycle impact overall business growth?

A well-managed sales cycle is directly linked to business growth. Buyers who are qualified and engaged are more likely to work with you to move the deal forward — accelerating your overall sales velocity. In turn, those faster, more efficient sales cycles lead to better business outcomes, from revenue growth to customer retention to overall market share.