What is a Closing Rate?

Definition The closing rate, also known as the win rate or close ratio, is a sales performance metric that measures the percentage of deals a salesperson or a company successfully closes out of the total number of opportunities they pursued. It is a critical Key Performance Indicator (KPI) for evaluating the effectiveness of a sales process, team, or individual. The closing rate is typically calculated as: Closing Rate=( Total Number of Deals in the Pipeline Number of Deals Won ​ )×100 Examples Individual Sales Rep: An Account Executive had 50 qualified opportunities in their pipeline last quarter and successfully closed 10 of them. Their closing rate is (10 / 50) * 100 = 20%. Marketing Campaign: A webinar generated 100 qualified leads, which resulted in 15 new customers. The closing rate for that specific campaign is 15%. Company-Wide: A company created 400 new sales opportunities in a fiscal year and converted 80 of them into paying customers. The company’s overall closing rate is 20%. Advantages/Benefits Performance Measurement: Provides a clear, objective benchmark to evaluate the effectiveness of individual salespeople, sales teams, and different sales strategies. Accurate Forecasting: Knowing the average closing rate allows for more precise revenue forecasting based on the current number of open opportunities in the pipeline. Process Optimization: A low or declining closing rate can signal problems in the sales process, such as poor lead qualification, ineffective demos, or pricing issues. Training and Development: Helps sales managers identify which reps are struggling to close deals and may need additional coaching or training. Related terms Sales Pipeline Conversion Rate Sales Velocity KPI (Key Performance Indicator) Win/Loss Analysis Sales Quota