Outsourced Sales: Reasons Not to Use In-House Reps
No matter what size company you’re operating, there are two options when it comes to hiring a sales team: outsourcing or in-house. What’s the difference? Simply put, in-house means appointing a person (or people) to work within the company. Normally with in-house hiring, the sales team is located in the same office as their colleagues.
On the other hand, outsourcing places the responsibility of sales with another company. Typically, outsourcing means having a team that works on behalf of the employer from another location. Outsourcing companies work with a number of clients to provide sales, as well as other services like accounting, HR, and customer support.
You may be wondering why companies choose to outsource sales and if it’s a wise step for you. While outsourcing has had somewhat of a negative reputation in the past, in recent years it has experienced a transformation and is becoming a more popular choice for businesses to facilitate growth and easily scale. Whether you’re looking to save money, significantly expand your sales reach, gain more qualified leads, or eliminate time-consuming processes, there are many perks to outsourcing.
Here are the main reasons not to use in-house reps and use outsourced sales instead:
Being smart with money is integral for any venture, and one of the hardest issues companies face is scaling without overspending on resources. Consequently, 90% of startups fail in their first year.
Sales departments recruit new employees more regularly than other areas of business - facing a turnover rate of roughly 20%. Such a fast change of employees is problematic for finances, training, moral, and your reps having a deeper understanding of the product being sold.
One effective way to bypass the issue is to use an outsourced sales team, as they skip past the additional costs and enable you to focus on your sales goals. Things like training, finder's fees, and background checks are all handled by the outsourced company, so you now don't have to plan for unexpected bills or have to prepare for people leaving suddenly.
Additionally, outsourcing companies are often located in regions where the costs of labor, real estate and other factors are lower, so they're able to sell their services at a lower cost than what an internal team would be.
Lengthy Hiring Processes
Going down the in-house sales route requires not only money, but time, and a significant chunk of it. Whether you’re searching for one sales rep or a team of ten, checking resumes and references, plus conducting interviews, can be a distraction from the real focus of the company. In fact, according to LinkedIn, 30% of companies fill a vacancy in 30 days; the remaining 70% take between one to two months to fully process a new hire. Particularly among small companies where employee count is low, tasks like hiring sales personnel uses precious resources and has the potential to compromise on the quality of a candidate for the sake of filling a position.
Outsourcing then, is a quick fix to the hiring problem. Companies that provide outsourced sales reps are responsible for the entire hiring process, and typically have their own proven methods for finding the right people. As a result, outsourced reps come quality-assured, not to mention, training and personal development programs are provided by the outsourcing company, so reps consistently perform well.
Ultimately, sales experts have a better eye for recruiting other sales experts as opposed to a small HR team taking on the task.
Harder to Track Progress
Attempting to monitor the progression of a business is tricky. Keeping on top of details, and regularly tracking key metrics is vital. To ensure good business health, you need to watch the vitals. Using in-house reps leaves more room for error - employees forget to document calls, emails, and general updates, or perhaps the fear of micromanaging means the documentation is there but is incomplete.
Contrarily, outsourcing promises frequent, clear, unbiased reports about sales performance. These reports should include KPIs that have been agreed upon before the outsourced sales reps begin work. They should make comparisons between weekly productivity, and be as granular as possible so even the most subtle of trends can be recognized.
While many businesses hope to be in-depth with their progress tracking, it’s another task that is time-consuming and easy to overlook. Outsourcing ensures companies know exactly how many potential clients have been touched, how many leads collected, the status of those leads, the number of sales, and can offer feedback about different industries’ response to the company product.
Think of outsourcing as a type of audit - the outsourced sales reps are a fresh set of eyes to judge what works and what doesn’t work. They can pinpoint ideal client personas, as well as develop a tone of voice around your brand. They also can be more experimental in their approach - a risk could result in higher commission earned that week.
Often a quality undermined by companies is having the correct equipment to empower sales. Teams need more than headsets and a computer or phone - in this day and age, daily sales take place on a mass scale, and personal data is more valuable than ever. Among such a hyper-competitive landscape, several tools have been developed to help sales reps, however, the majority of them are not cheap and are not justifiable for all budgets.
Rather than settle for outdated technology that just covers the scope of your needs, outsourced centers can provide things like a cloud-based CRM, online chat bots, and software subscriptions to services like HubSpot, Apollo, Seamless, FrontSpin and Pipedrive. Outsourcing also comes with tools for analytics and reporting, conference calling, employee productivity trackers, project management, and legal/compliance.
These are just a few of the reasons not to use in-house sales reps. The advantages of outsourcing combined with the low costs make it a viable option for many companies. That said, it’s important to note that outsourcing is most effective when careful considerations have been made prior to committing. Do thorough research around what outsourcing company is best suited to your business, ask for testimonials about their services and always be upfront about your expectations. Follow these basic steps and you’ll have a recipe for sales success.
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