What is Ramp Up Time in sales?
A sales ramp up time of a company refers to the amount of time a new salesperson takes to become fully productive from their onboarding day. This process includes initial product training, sales coaching, and any and all onboarding that is part of the new-hire process. Calculating ramp uptime is important for organizations to improve the onboarding process and plan the capacity needs of the team.
How to calculate Ramp Up time?
There are different ways of calculating ramp up time. Factors like industry, growth rate, company size, and training program all influence how an organization defines and calculates this equation to full productivity.
- Ramp by Length of Sales Cycle:
- Ramp by Time Needed to Achieve Quota:
- Ramp by Training and Experience Level:
Sales Ramp Up Time = Average Length of Sales Cycle + Training Period
This is the simplest method to calculate sales ramp up time. All you require is the length of the average sales cycle and a defined onboarding time of a new hire. For example, let’s say the average deal takes between 3-5 months to close. As a manager, you have concluded that a starting rep will need at least three months to be prepared and trained well enough to close a deal successfully. So accordingly, the ramp-up time would be 6 months. If a rep is new to the industry or in a sales role, it might take even longer for them to ramp up to full productivity.
Sales Ramp Time = Average Length of Time to Meet 100% of Quota
This is the most commonly used method to calculate ramp up time. This method works best for organizations where sales teams might not directly sell a certain product or don’t have an average sales cycle. The quota attainment method helps give a more general assessment of sales ramp time with the mindset that not all sales reps will start off with the same account set up and territories.
Sales Ramp Time = Training Period + Length of Sales Cycle + Level of Experience
Take the average amount of time given for training new sales reps in addition to the average sales cycle length, the same as we did in ramp up by the length of the sales cycle method. Also, add in an allotted amount of time to account for any former sales background. The training period will remain the same irrespective of the level of experience. For example, two weeks added for a new hire with previous, relevant experience. On the other hand, two months would be added for a new rep who has no prior experience.