Establish the number properly
Before diagnosing, know the actual figure. Close rate is customers divided by qualified enquiries — not by every call, since wrong numbers and suppliers are not enquiries.
Calculate it monthly for the last year. Then you know whether you are looking at a genuine decline, a seasonal pattern, or a normal fluctuation that felt like a decline.
Cause one: the enquiries changed
The most common explanation, and the least discussed. If a new channel is bringing less-qualified people, close rate falls with no change in how you sell.
Check close rate by source. If organic converts at 40% and a new campaign converts at 8%, the sales process is not the problem — the traffic is. The fix is targeting, not selling.
This also happens organically: ranking for a broader term brings browsers instead of buyers.
Cause two: response time slipped
Speed of first response is the single strongest predictor of whether an enquiry converts. A business that replied within an hour and now takes a day will lose work without changing anything else.
Measure the real figure — time from enquiry received to first meaningful contact, not to an automated acknowledgement. Then check whether it moved at the same time the close rate did.
Cause three: the market moved
Competitors change what they offer, and you find out late:
- Someone now publishes prices and you do not
- A competitor offers evening or weekend appointments
- Someone offers a guarantee or a warranty you do not match
- Prices moved and yours are now visibly high or suspiciously low
Do the exercise properly: search what your customers search, request quotes from two competitors, and see what the experience is like. It is uncomfortable and it is the fastest way to find out.
Cause four: the process degraded
Sales processes decay quietly, especially under pressure:
- Quotes going out slower, or less clearly
- Nobody following up
- A new person handling enquiries without the same knowledge
- Questions being answered curtly because everyone is busy
Listen to recorded calls if you have them, and read the last twenty quotes you sent. Both usually reveal something.
Find where in the sequence it fails
Map the steps: enquiry, contact, qualification, quote, follow-up, close. Then count how many enquiries reach each step.
The drop-off point tells you what to fix. Losing people between enquiry and contact is an operational problem; losing them between quote and close is a pricing or persuasion problem. These need completely different responses, and businesses frequently work on the wrong one.
Ask the ones who said no
Call ten people who did not proceed and ask what happened. Most will tell you. It is the highest-quality information available and almost nobody collects it.
Be genuinely curious rather than making a second attempt at selling — the aim is the answer, not the job.
Fix in order of cheapness
- Response time
- Following up existing quotes
- Making quotes clearer
- Answering the questions that stall people, on the website
- Reviewing pricing
- Changing traffic sources
The first two cost nothing and account for most recoveries.
Frequently asked questions
How should close rate be calculated?
Customers divided by qualified enquiries, not by every call — wrong numbers and suppliers are not enquiries. Calculate it monthly for a year so you can tell a decline from a seasonal pattern.
What is the most common cause?
The enquiries changed. Check close rate by source: if organic converts at 40% and a new campaign at 8%, the sales process is fine and the targeting is the problem.
How much does response time matter?
It is the single strongest predictor of whether an enquiry converts. Measure time from enquiry to first meaningful contact — not an automated acknowledgement — and check whether it moved when the close rate did.
How do I find where the process fails?
Map enquiry, contact, qualification, quote, follow-up, close, and count how many reach each step. Losing people before contact is operational; losing them after the quote is pricing or persuasion. They need opposite fixes.
What should I fix first?
Response time and following up existing quotes. Both cost nothing and account for most recoveries, before you touch pricing or traffic sources.