How To Calculate Sales Pipeline Coverage in Quickbooks Online | Arithmix

Calculating sales pipeline coverage is a crucial aspect of any business that wants to stay on top of its sales performance. It helps you understand how much of your potential revenue is in the pipeline and how much is likely to close in a given period. This information is essential for making informed decisions about sales strategies and resource allocation. In this article, we will discuss what sales pipeline coverage is, when it is valuable to calculate it, and how to calculate it.

What Is Sales Pipeline Coverage?

Sales pipeline coverage is a metric that measures the ratio of potential revenue in the sales pipeline to the revenue goal for a given period. It helps you understand how much of your potential revenue is in the pipeline and how much is likely to close in a given period. The sales pipeline is the series of stages that a potential customer goes through before becoming a paying customer. These stages typically include lead generation, qualification, proposal, negotiation, and closing. The sales pipeline coverage metric is calculated by dividing the potential revenue in the pipeline by the revenue goal for a given period.

For example, if your revenue goal for the quarter is $500,000, and your potential revenue in the pipeline is $1,000,000, your sales pipeline coverage would be 200%. This means that you have twice as much potential revenue in the pipeline as your revenue goal for the quarter.

When Is It Valuable To Calculate Sales Pipeline Coverage?

Calculating sales pipeline coverage is valuable for businesses of all sizes and industries. It helps you understand how much potential revenue is in the pipeline and how much is likely to close in a given period. This information is essential for making informed decisions about sales strategies and resource allocation. Here are some scenarios where calculating sales pipeline coverage is particularly valuable:

• When you want to forecast revenue for a given period
• When you want to identify potential bottlenecks in your sales process
• When you want to optimize your sales process to increase revenue
• When you want to allocate resources to the most promising sales opportunities

How to Calculate Sales Pipeline Coverage

Calculating sales pipeline coverage is a straightforward process that involves three steps:

1. Determine your revenue goal for the given period
2. Determine the potential revenue in your sales pipeline
3. Divide the potential revenue in your sales pipeline by your revenue goal for the given period

Here's an example:

Let's say your revenue goal for the quarter is $500,000. You have 50 potential deals in your sales pipeline, with an average deal size of $20,000. The total potential revenue in your pipeline is $1,000,000 ($20,000 x 50). To calculate your sales pipeline coverage, divide the potential revenue in your pipeline by your revenue goal for the quarter:

Sales pipeline coverage = $1,000,000 / $500,000 = 200%

So, in this example, you have twice as much potential revenue in your pipeline as your revenue goal for the quarter.

In conclusion, calculating sales pipeline coverage is a valuable metric for any business that wants to stay on top of its sales performance. It helps you understand how much potential revenue is in the pipeline and how much is likely to close in a given period. By following the steps outlined in this article, you can easily calculate your sales pipeline coverage and use this information to make informed decisions about sales strategies and resource allocation.

How Do You Calculate Sales Pipeline Coverage in Quickbooks Online

Quickbooks Online itself isn’t naturally geared towards letting you calculate complex metrics like Sales Pipeline Coverage. As an alternative, teams typically use products like Arithmix to import data from Quickbooks Online and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like Quickbooks Online, combine it with data from other systems, and create calculations like Sales Pipeline Coverage.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating Sales Pipeline Coverage in Arithmix

Calculating metrics like Sales Pipeline Coverage is simple in Arithmix. Once you've created your free account, you’ll be able to import your Quickbooks Online data, and use it to create natural language formulas for metrics like Sales Pipeline Coverage.

Arithmix is designed to give you the power to build any calculations you want on top of your Quickbooks Online data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.