Inside Sales is an essential Lead Generation channel that most companies require. Once you have concluded that, the question lingering would be; whether you need to build one in-house or have an external/outsourced partner to support you?
Although it might seem like a regular day to day decision to be made, but setting up an Inside Sales team will have long term strategic implications. Inside Sales is like an engine; when you opt to build it yourself, you will have to start from scratch and then drive it until it can be set on auto pilot. On the other hand, if you were to outsource the engine it becomes the partner’s onus to get the engine up and running for you. The only thing required from you while outsourcing an Inside Sales team will be providing them with a direction.
Every business, be it a start-up or an established one, wants quality leads to be added to their sales funnel. The more the leads the greater the probability of conversion to opportunity and closure. And, with the increase in sales cycle of B2B businesses from 2 months to 2 years, it has become more eminent to have a consistent flow of leads.
By the end of this blog, you will realize why it is a good idea to outsource an Inside Sales Team!
Why we say it is time to outsource an inside sales team:
1. Maybe an in-house inside sales team is not your cup of tea.
Many businesses, that we interact with have tried setting up an in-house team but failed, the main reason being operational difficulties (mentioned in the subsequent points).
Setting up a team can take anywhere from 6 months to 1 year minimum, so you need to have the patience and investment (look at it as a long term investment) for this to succeed. From what we have noticed, one of the biggest reason for failure is that none of the decision makers had any prior experience neither did they get themselves involved deeply into the process. Hence, they had to trust on the senior resources who joined and did not know what exactly to expect from the whole team, let’s say the KPI’s. Time went by and things started going haywire, too many things were tried resulting in loss of patience, slowly questioning the ROI and finally it got scrapped. Even if we leave out the investment loss, time loss has no substitute.
Did you know that 20% of companies in an effort to transform and\or reorganize their sales processes opt to outsource their sales teams? Thus, it is only wise to leave it to the experts, and may be even learn a few things by working closely with them.
2. You don’t have the luxury of time.
Businesses today need to be agile, as mentioned earlier setting up an inside sales team from scratch can consume a lot of time. This in return delays your overall Go-To Market strategy. Let’s say you are planning to take your service/product to a new market or you are about to launch a new product or service in an existing market.
Time is money, every day lost is probably an opportunity lost. By outsourcing you’re inside sales you can kick-off the entire operation in a span of 1 month with maximum give and take involved, as the partner would already have people, process, technology and resources in place. It just boils down to adapting to your requirement. You can easily compare the difference.
In a recent research by Sourcing Line Computer Economic survey, was brought to notice that, 9% of companies outsourced sales services with the purpose of speeding up time involved in penetrating a market; so as to not lose out on any opportunities.
If you are a VC funded startup, you would probably know that the VC’s are famous for bringing out their swords to make sure certain targets are achieved within a defined period. To tackle the Term Sheet conditions and to be able to receive the next round of funding scheduled in the pipeline, time is money in true sense!
3. Tackle Operational Difficulties
Insides Sales like any another department is a mix of Process, People, Technology, Analytics and Decisions (P2TAD) which brings along its own set of operational difficulties.
The biggest problem noticed is mostly of people management. Getting the right sales resume with the right people are the hardest to authenticate. Hiring a sales person is a leap of faith, it gets a lot more difficult if you have no prior experience in hiring one.
Adding to that, there is always the problem of attrition which is a great deal in inside sales due to the work pressure. About 48% of sales departments have to deal with this issue. Attrition during the initial stages can be a big hindrance causing further delays.
Moreover, scaling up and scaling down a sales team has its own problems. Then you have the process setup and monitoring hurdles, a great deal of personal time needs to be dedicated which seems impossible to be tackled all at once.
Of course any company must first carry out a due diligence on the outsourcing partner; to know whether they understand your product or service thoroughly. Whether their ability to position your product or service is right? Do they have a team full of experts? And more.
4. Outsource so you can Focus On Your Core Business.
Let’s be honest here, Inside Sales is a greasy job! Or rather, a greasy yet essential job! So, to get it done by someone is a lot easier than doing it yourself. Outsourcing an inside sales team gives you more time and opportunity to focus on your core business.
You can be busy on developing new products or adding updates or providing attention to your customers, while the outsourced inside sales team takes care of bringing you quality leads. Generating quality leads and building your sales pipeline is the responsibility of the partner. Opportunity discussions and closure are what you need to put your energy into.
Focus on core competencies and outsource the rest, outsourcing emancipates your staff and lets them focus on the strengths thereby allowing you to derive maximum benefits of their talent.
As a business owner/Stakeholder you may want to have everything in your control but that will be almost impossible to achieve. Sourcing Line Computer Economic survey established that, 15% of companies outsource to accelerate projects and tap into outside management expertise.
5. Outsourcing can bring Agility
In today’s fast paced environment it is a mandate for businesses to have the flexibility and ability to plan, implement and change marketing strategies with the shortest turnaround time and risks involved.
Outsourcing gives businesses the flexibility to implement go-to-market strategies at a much faster pace, take better calculated risks as operational overheads are better accounted for.
Suppose you want to launch your product or service in a new demography or multiple demographics and time zones. Management setting up, expanding your existing inside sales team, or lead generation brings its own troubles. Setting up a new office, new hires, training etc. and the time taken to process a go-to market is challenging. Also, you may not be able to gauge the break-even point, and work out the additional costs involved.
Instead, if this were an outsourced team of well-established inside sales professionals, expanding to two more demographics could be put to action within no time since they will have back-ups, bandwidth and the expertise to deliver.
6. Outsourcing Is Cost Effective
Every Business wants to keep a check on its cost per lead or cost per sale. The lower the better. The actual cost curve varies from business to business. Setting up or upgrading your in-house inside sales team has both tangible and intangible costs which directly shoots up your cost per lead and might take 2 years or more to stabilize or become justifiable to the management.
A very well put statement by Akira Hirai states;
You could pay your staff their regular wages for nine hours to struggle through a project outside their skill set, or pay a specialist for three hours. Why finance a learning curve when a pro could complete the project in a fraction of the time?
Sourcing Line Computer Economic survey shows, money is the highest factor with 44% of companies outsourcing to reduce costs. However while comparing costs, make sure to compare the overall cost involved in lead generation operation and you will see how cost effective outsourcing eventually is.
Let’s take an example; to setup a standard inside sales practice, you would need the following:
- 3 Inside Sales Reps: Typically Hire 5 inside Sales (1 Manager) resources in progress to be prepared for attrition (the composition of seniority/experience will vary from business to business)
- You will also need a Marketing team of 2 people minimum for list building and marketing campaign execution.
- You will need access to the following tools:
- CRM
- Third Party Databases, LinkedIn Premium Accounts
- Email Marketing/Marketing Automation Tools
- IT Infrastructure
- In case you do not have prior experience in inside sales you would need to have an external consultant engaged for at least 6 months.
- Then you have the overall management costs.
When you sum up all the above costs involved, you will realize that it is not only money but also time and effort you will end up spending. Typically it would take 3-6 months for businesses to setup the whole team and process. The expected time for lead generation to kick off would be ideally from the 4th month provided everything is going as per plan.
To conclude I would like to add, productive outsourcing should always simplify your workload. When you are too busy getting your startup rolling, smart outsourcing can save effort, money and time and lets you push your energies into the most gratifying parts of your business. Although, leaving the reins in their hands is never wise, therefore work closely with them for the benefit of your business.
