Pipeline coverage is the ratio of the total open pipeline value to your sales target for a period. A 3x coverage means you have three times your target in open opportunities. It accounts for the fact that not every deal closes, so you need more pipeline than quota to hit the number.

Pipeline coverage is the early warning system for missing your number. If you need $1M and have only $1.5M in the pipeline at a 25% close rate, you are already short and do not know it yet. Calculate the required coverage from your real close rate, then watch it weekly. It predicts the miss months before it happens.

Example:

 Quarterly target is $1,000,000, and open pipeline is $3,000,000. Coverage is 3x. If your historical close rate is 33%, that 3x is exactly enough.

What is a good pipeline coverage ratio?

 Often cited as 3x to 4x, but your close rate sets the right number. A 25% close rate requires 4x coverage to hit the target on average.

How do I calculate required pipeline coverage?

 Divide 1 by your historical close rate. A 33% close rate needs roughly 3x coverage; a 20% close rate needs 5x.