Definition
The ratio of total open pipeline value to the remaining revenue target for the period.
Formula
Total open pipeline value / Remaining revenue target
How to measure
Sum the value of all open opportunities expected to close in the period and divide by the revenue quota still needed.
Why track it
A coverage ratio below roughly 3x is a common early warning that a sales team will miss its target for the period.
Example
A team with a $1 million remaining quota and $2.5 million in open pipeline has a 2.5x coverage ratio, below the typical 3x benchmark.
FAQ
- What is Pipeline Coverage Ratio?
- The ratio of total open pipeline value to the remaining revenue target for the period.
- How do you calculate Pipeline Coverage Ratio?
- Total open pipeline value / Remaining revenue target
- Why track Pipeline Coverage Ratio?
- A coverage ratio below roughly 3x is a common early warning that a sales team will miss its target for the period.