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The third Key Performance Indicator (KPI) discussed is the proposal conversion rate, which measures efficiency as a percentage of proposals submitted that successfully convert into business. For example, if the conversion rate is 30%, this serves as a baseline to analyze improvements. To increase this rate to 40% or 50%, businesses must evaluate and enhance either the quality of their proposals or the quality of their prospects. This assessment is crucial for creating a clearer path to success with each proposal and ultimately raising the conversion rate.