How to handle lost sales

It is a fact of life that you will lose some of the sales you go after.  No company will win every sale it goes after.  In some situations, you may lose more sales than you win.  Even if you do, it is still possible to have a successful and profitable business.  If you find yourself in this situation, it makes sense to look at improving your conversion rates.  There may be some changes you can introduce to your sales process which helps you qualify prospects far better and keep those qualified prospects interested in your products/services.  In some markets you will simply be confronted by many powerful competitors and you will survive by picking up small orders left by your competitors.

Once again, this is not an ideal position to be in but you can turn it to your advantage and build a successful business on these smaller orders.  The secret is to apply rigorous qualification criteria so that you rarely meet these more powerful competitors head-to-head.

Losing a good percentage of the sales you chase can become dispiriting and demotivating.  It requires you to develop a “thick skin” so you can bounce back after each setback.

If you can come to terms with losing so many sales, it is good practise to have a process which gives you the opportunity to do better in future sales campaigns.  For every sales situation you fail to win, I recommend you look at two elements.  The first is to identify what lessons you can learn from each loss.  The second is to position your business to receive future sales opportunities from this prospect.

Let’s look at these in turn.

Learning Lessons.  You will have invested considerable time and effort trying to win a sale and will, naturally, be disappointed to learn you had failed to win the order.  If you simply walk away, all this investment is wasted.  You should get into the mindset of extracting something of value from every lost sale.

This could be feedback from the prospect on how you might improve your product/service or how to improve your sales process.  You will learn most of your lessons by talking to your prospect after the sale has been lost.  Many small business owners simply walk away from a lost sale and move onto another prospect.  They are leaving behind nuggets of information which will help them improve their future sales performance.

What could you have done better? What did the prospect like about your proposal? What did they think could have been improved?  What features were missing in your product that your prospect felt were important in their evaluation?  Why were these features important?

Aim to gain something in return for all the effort you have put into each failed sales campaign.  The process of continual learning will ultimately help you achieve more success in the future.

At the same time, you are building your relationship with this prospect and showing an interest in improving your product/service which could benefit the prospect.  Just by doing this, you immediately stand out from your competition.  Not every purchase decision made by your prospects will be the right one.  Occasionally, the chosen supplier will fail to meet its obligations.  This leaves the buyer in an awkward position – does it continue with a struggling supplier in the hope things improve over time or switch to a different supplier?

If they decide to take the second option, how you handled yourself when told you had failed to win the original sale will determine whether or not you are considered for this opportunity.

Positioning for the future.  The loss of a sale doesn’t mean you will never sell to this prospect.  There will be future opportunities and you will want to be given the chance to quote for future orders.  Immediately after losing a sale is the best time to position your company for the future.

Three things might happen which will change the landscape of each lost prospect.

(a)  The chosen supplier might mess up and the prospect will be in desperate need for an alternative, reliable supplier (as described above).

(b)  The person making the decision might leave (or be moved) and be replaced by someone who will reconsider your credentials.

(c)  The expected benefits of the original purchase may not materialise and the prospect will look around for an alternative supplier.

For all scenarios, your ability to engage meaningfully with the prospect in the future will depend on how you handled yourself when you lost the original sale.


  1. Talk regularly with prospects after you have lost a sale.  Develop closer relationships with prospects and learn why you lost the sale.  Immediately position yourself to be considered for any future opportunities.
  2. After losing a sale, monitor the performance of the chosen supplier.  Opportunities will arise if buyers don’t realise the expected benefits and you might gain some useful intelligence regarding your competitor.
Posted in Sales / Business Growth