Sales Outsourcing

Sections published in Independent Business – June 2006 Hertfordshire Edition

This article briefly explores the question of whether companies should outsource their sales function and/or look outside their organisation for support with sales.

There is definitely a lack of flexible and shared-cost sales expertise for small and medium sized businesses. If we need an accountant, solicitor, or IT specialist we are generally spoilt for choice, and can engage them usually on either an hourly or retention basis. With sales resource there is generally only the option to employ a sales person full-time or use a telemarketing/telesales operation.

Sales outsourcing is still relatively new but it is catching on as a flexible, pay-as-you-need, service. After all, if you feel comfortable outsourcing your finance function why wouldn’t you feel the same about outsourcing sales. The issues for both come down to “perceived control” and of course “trust”.

As many of you know, hiring sales people is not enough, they need to be managed and their activity and results properly monitored. (Some people can work independently and get on with it, others cannot, and you may not always find an individual who can sell and also be independent). If you’ve managed a large diverse sales team then you’re in a better position to do this than for example an already very busy Managing Director.

So why would you look outside your organisation or hire someone part-time? External perspectives on your business are valued, and introducing tried and tested methodologies can work for most business types, after all where would “management consultancy” be if this wasn’t true. However, there are a number of additional reasons why using an external sales consultant or “interim” makes sense:

  •           Broader industry/sector experience and executive network
  •           Independence and objectivity
  •           External perspective on your sales and marketing proposition
  •           Sales process methodologies
  •           Understanding of sales key performance metrics
  •           Been there, got the t-shirt in the sales discipline
  •           Clearer focus, enthusiasm and motivation – vested interest in performing well
  •           More senior sales expertise than you could afford full-time
  •           Cost – no fixed costs
  •           Flexibility – on a need basis

Generally sales people stick to one industry or sector and have a specialism and network that reflects this. Many sales management consultants have deliberately worked across industries and sectors to build up a more varied and layered experience which provides “out of the box” thinking and means they can work for different sorts of businesses. Independence and objectivity enable the consultant to make apolitical decisions and see things more clearly without historical factors or being caught in a silo. They can also be more critical about your sales and marketing proposition to customers and help you differentiate from competitors (what makes you different, what are you offering, why would I buy from your company?).

Sales process follows a defined set of stages within the qualification and close of a sale and can be implemented in any business with minimal tweaking. If you are not selling effectively it usually means there is a gap or breakdown in the sales process within your company. Do you have the right sales structures in place, do your sales people have the tools to be most effective, what customer relationship management system is used, how accurately do they forecast business coming in, how are they incentivised and motivated?

In many businesses the sales people are hired by the Managing Director and he or she does not know what sales people should do, how they should approach the sale or the customer, what are appropriate activity levels, what are the benchmarks, after all he or she just want them to “sell”. Often the sales people moved into a sales position from another area of the business and have had no formal sales training. By introducing key performance metrics and even formal sales reporting the Managing Director will be able to “performance manage” the sales function.

We all know we get a bit stale when we do the same thing day in day out. Also sales people do “burn out” and usually have 2-3 years of success before their sales dwindle. A fresh approach is needed and someone who works in your business for a fixed or ongoing part-time basis brings enthusiasm to the role and a clear focus. Consultants don’t take lunch breaks! Their attitude is very different from that of a full-time member of staff. If they don’t perform well you won’t ask them back and you won’t recommend them to other companies.

Many companies would prefer to have a great sales person 2 days a week than a mediocre one 5 days a week, and if we could afford them full-time all the better. However, the likelihood is that we might find it hard to handle that much business, and therefore a part-time “heavy hitter” works well.

So how much is it going to cost, and won’t it be more expensive than hiring someone full-time? The daily rate will certainly be more expensive than the cost of employing someone at first glance if you annualise it. However, did you factor in the following; pay as you need, no bonus to pay, no pension costs, no car costs, no training costs, no health cover, no computer, no mobile phone, no expense account, no recruitment or redundancy costs, no office space, no employer’s National Insurance (12.8%), and you don’t need to pay them for 30 days paid holiday and 10 days of average sick pay per year. You’ve probably worked it out for yourself!

Matt Jefferson is Managing Director of Jefferson Sales based in Hertfordshire and can be contacted by phone on 020 7096 2005. He is a Fellow of the Institute of Sales and Marketing Management.

By providing an objective and independent view of your sales proposition and strategy for growth, sales processes and management systems, sales peoples’ ability and performance, business development and customer acquisition strategies, Jefferson Sales are able to see things clearly and ensure that you get the results you need.

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