{"id":40035,"date":"2022-10-13T13:54:20","date_gmt":"2022-10-13T11:54:20","guid":{"rendered":"https:\/\/stryfes.com\/impact-on-win-ratio\/"},"modified":"2023-02-06T14:14:20","modified_gmt":"2023-02-06T12:14:20","slug":"impact-on-win-ratio","status":"publish","type":"post","link":"https:\/\/stryfes.com\/en\/impact-on-win-ratio\/","title":{"rendered":"Impact on win ratio"},"content":{"rendered":"

How do you know if your proposals are good and if you are not missing opportunities<\/strong>? We are talking about the win ratio of proposals, also called the conversion ratio. You calculate this like this:<\/p>\n

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win ratio = all quotations approved by customer \/ all quotations issued in x time<\/p>\n<\/blockquote>\n

Determining a good win ratio cannot be done overnight. It depends on the sector and then also by service or product. Still, you want to know<\/strong> your win ratio relative to your market. A benchmark, in other words. These are the most critical parameters for your benchmark.<\/p>\n<\/div><\/div><\/div><\/div><\/div>

Number of competitors<\/h2><\/div>

In some markets, you have a lot of competition; in others, hardly any. The number of competitors matters. Your win ratio should be higher than the total market\/number of competitors in a market with few competitors. So if you have two direct competitors, there are three of you. If you have a win ratio lower than 33%, you have work to do. Because then you immediately lose market share in absolute terms.<\/p>\n

This component is less important if there are more than ten competitors. The customer compares only a few competitors.<\/p>\n<\/div>

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Market position<\/h2><\/div>

How important are you as a player in your industry? Are you relatively small, or are you a market leader<\/strong>? If the buyers understand the market, as in Telecom, they almost always invite the first two or three in the market. As an industry leader, you often have a significant edge. This also means that you are missing opportunities if you have a lower scoring rate than 50% as an industry leader.<\/p>\n

By contrast, 50% is hard to come by as a small party. If you score 30%, you are doing well.<\/p>\n<\/div><\/div><\/div><\/div><\/div>

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Awareness of product or service<\/h2><\/div>

A product or service that is not yet well known to the general public sells harder. The customer does not see it as a solution to his problem or as fulfilling his desire. You have to explain more<\/strong> then. In many sectors, people are not nearly as progressive as they think. Cold feet are the order of the day. So if you have a product or service that is not yet at the maturity stage, your proposal scoring rate is often below 40%.<\/p>\n<\/div>

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Homogeneity<\/h2><\/div>

You probably answer now that you are very different, and your services or products are not similar to the competitors. Step into a customer’s shoes and answer this question from their perspective. What do customers value? And how do your competitors deliver? Is it virtually the same<\/strong>, or are there significant differences? This so-called homogeneity is best seen from the customer’s perspective if you can easily compare your offering to the competition.<\/p>\n

For example, a white loaf of bread is a white loaf of bread. The customer will then mainly look at objective things such as price, ease of buying the product, and the number of slices. And additionally to subjective<\/strong> things like taste & feeling in the store. So this is a very homogenous product.<\/p>\n

The greater the differences, the better you can qualify whether a customer will choose you and the higher your win ratio should be.<\/p>\n<\/div><\/div><\/div><\/div><\/div>

The scope of the contract<\/h2><\/div>

The contract size is not about how big you think the contract is. It’s all about how great your client thinks the contract is. Is it a relatively<\/strong> minor purchase for him? Then he pays less attention to the purchase process. Outstanding proposals pick them right out. This is where your scoring rate should be higher than 50%.<\/p>\n

All of these are different percentages. How do you bring this together in a benchmark so you can determine whether your bids are doing well?<\/p>\n<\/div>

Conclusion<\/h2><\/div>

Several things influence your win ratio. Therefore, it is essential<\/strong> to look at this carefully. Things to consider are the Number of competitors; Position in the market; Familiarity with the product or service; Homogeneity, and Size of the contract for the customer.<\/p>\n

These things affect the potential win ratio. To understand<\/strong> your win ratio better, Stryfes recommends keeping a close eye on your own win ratio. By comparing these quarterly, you can easily see if the trend in your win ratio is improving.<\/p>\n<\/div>

Want to read more about good quotations? Here are a few articles:<\/p>\n