Ramp-up time is the period of time it takes new sales employees to become fully productive after they start working for your business. Included in this is their onboarding period, which gives them time to finish product training, learn about your sales process, become proficient with your sales tools, and receive first mentoring from managers or other team members.
For better forecasting based on rep capacity, sales management needs to understand how long it takes to ramp up new recruits. Additionally, it aids in the planning of your future employment requirements, allowing you to add new employees before your team reaches capacity.
By carefully examining the length of your sales cycle, you may determine your sales ramp time in the easiest way possible. Consider, for one, that the average contract closes in between three and six months. This indicates that it will take a new rep at least three months to ramp up to their maximum output. And it can take even longer if a seller is new to the sector or working in sales.
Sales Ramp Up Time = Average Length of Sales Cycle + 90 Days
Best Practice: Your onboarding procedure should include buffer time.
Provide new reps and your sales enablement team buffer time to reach peak productivity. Try to provide yourself a window of time that is equal to your sales cycle plus an additional 90 days. Time for your company's standard onboarding and training procedures, which each employee must complete, should also be taken into account.
Result: The ramp time would be six months (3-month sales cycle + 90-day buffer = 6-month ramp).
The most popular way for calculating sales ramp time is the quota attainment method. It functions well for businesses without an average sales cycle or those that do not directly sell products. The quota attainment technique offers an overall evaluation of the sales ramp-up period while keeping in mind that not every sales representative will begin with the same accounts and territories.
Sales Ramp Time = Average Length of Time to Meet 100% of Quota
Best Practice: Equalize the Rep's earning opportunities
Your new sales representatives don't all start at the same level. Some will take over already accounts and hit quota more quickly. At the same time, some reps might regularly reach a sizable portion of their quota but never achieve a 100+ percent mark.
Some businesses create a draw against commission in their sales compensation plan that is equal to a percentage of anticipated commissions after training to make up for this discrepancy.
The method of experience and training level is straightforward. The length of the typical sales cycle is increased by the typical amount of time spent training new sales representatives. To account for any prior sales experience, you should additionally include a time allotment
Sales Ramp Time = Training Period + Length of Sales Cycle + Level of Experience
For a new hire with prior, pertinent experience, for instance, an additional two weeks were added. On the other hand, a new rep without any prior experience would be given a further two months.
Best Practice: Adapt training to experience
Make sure you hire the right people, then train them specifically. This will enable more experienced vendors to ramp up more quickly and provide those with less experience enough time to do so.
- Develop and distribute a ramp-up plan for new hires: Create a document that details your new recruit ramp-up strategy. If your procedure is uniform, you can utilize templates for this; but, if you determine the ramp-up time depending on experience, you'll need to customize it for each rep.
- Plan your sales onboarding: Successful ramp-up prepares reps for long-term success by giving them a thorough understanding of your organization and how it functions. The first stage of a prolonged ramp-up phase for new hires is sales onboarding.
- Provide effective sales training and coaching: New sales recruits frequently go through initial training to learn about the product, market, sales process, and ideal customer profile when they join a company. The Training Industry reports that highly efficient sales training can reduce ramp-up time by as much as seven weeks. Effective training should be tailored to each rep's needs, with personalized mentoring and plenty of resources for self-directed learning.
- Monitor and review progress: It might be challenging to determine your reps' knowledge levels and how prepared they are to begin having genuine sales conversations as they progress through the onboarding process. Tracking onboarding session completion rates and administering knowledge tests along the route are helpful.