Companies have traditionally looked to external sales teams to be the people reaching out to customers in business development or account management roles with the intent of closing deals. These traditional methods of selling can be expensive loaded with direct and indirect costs corroding company profits. They incur costs of not only salaries but motor vehicles and running costs. Often there are travel allowances for interstate travel and these can escalate the cost of sales significantly.
Those teams are backed up with a customer service centre to answer questions and provide guidance of stock, deliveries and all other relevant trading questions with the customers. Often there is overlap between the role of sales and the role of customer service, call adding to the cost of sale.
The focus for companies is on lowering the cost of acquisition of customers, being an essential goal for all businesses. Those savings go directly to the bottom line revenue. The emergence of inside sales being a revenue stream is becoming a greater priority to companies. An inside sales team was once a minority and clouded under customer service models and never deemed a profit centre.
Fortunately for many companies, with the shift in buyer behaviour, many of your customers will now actively purchase larger size products and services from inside sales than ever before. With consumer buyer behaviour increasing to a higher level of online and telephone purchases, this has crept its way into business to business creating a valuable income stream to companies.
Unshackling the past sales practices
When you mention inside sales, people immediately jump to either a customer service person answering inbound calls or telemarketing doing cold calls. In today’s market, neither are inside sales.
Today, sales are sales no matter where they are located. Whether they are handled remotely and require a sales process similar to field salespeople. It routinely involves a high number of contacts by phone and email.
Contrary to telemarketers who are almost always scripted, inside B2B sales professionals are highly skilled and knowledgeable. They perform the same tasks as say a sales representative. They can be managing both inbound and outbound sales, conducting lead generation calls and following through on lead management over the entire sales cycle.
Telemarketers focus on low dollar sales values with one touch to make the sale. Inside sales have multiple contacts touches to build the value and create demand for the product or service as like their counterparts in field sales.
With the advances in communication technology and changing buyer perceptions, inside salespeople can give presentations, conduct demonstrations and perform most of the functions traditionally handled by field salespeople. They can be working remotely and still productive. The trend toward remote sales becoming greater in modern business. The sales organization structure is changing and with the rise of online transparency and tools, the inside sales team can be effectively managed remotely.*
With time pressure a problem for most potential customers, often buyers are more willingly now to engage with inside salespeople than field sellers.
Customers can purchase quickly and efficiently through a few telephone calls and emails rather than face to face meetings taking an hour or more each visit. For companies, this means more sales made per day. The inside sales team is more on-demand for the buyer’s convenience.
From a cost point of view, inside salespeople now demand commission that is line with field sales and you certainly want to be rewarding their efforts. Your inside salespeople understand their value and look for compensation plans that reward their efforts in making outbound calls. The cost savings come from typically lower base salaries, no vehicle costs, no mobile phones and to the great relief of the finance department, no expense account.
Should your company invest in Inside Sales Team?
Not all sales models fit all companies. It is essential to understand that sales models are driven by customers and not by calculations on a spreadsheet. Before transitioning in part or whole to an inside sales team, there are some factors that determine the suitability of investing in inside sales.
- Sales Complexity: Not all companies can prosper from inside sales. It is ideally suited to less complex products that people are familiar with purchasing. They have most likely purchased similar products in the past from your company or competitors, and are confident moving forward in a buying process for your products and services.
- Business Maturity: Early-stage businesses require a stronger presence in the market and benefit from a combination of marketing and field sales to drive the brand and explore more substantial sales opportunities to gain traction against competitors. Inside sales typically do not have the impact required to achieve this. However, a mature business with a loyal customer base will see customers purchase large contracts, rolling them over for another term, with minimal prompting from inside sales.
- Growth Demand: Driving growth often requires a combination of both inside and field sales. The buyer’s behaviour will determine what degree of emphasis is placed on inside sales and field sales. Some buyers prefer the sales process to commence with inside sales exploring the value of opportunities and potential to fulfil customer needs. The buyer then feels the need to interact live with someone to have firsthand experience with the product before purchasing. The field salespeople being able to create higher-value sales with their onsite presence.
- Sales Goals: Sales goals have increased for inside sales. In the past sales goals were often well short of a million dollars whereas today, they are often in the seven figures each year. The opportunity for a high return on investment
- Buyer Preference: A survey of your customers will determine their receptiveness to inside sales. In a recent study by Sales Benchmark Index, 70% of your customers don’t even want an in-person meeting. Key decision-makers are quite receptive to doing business remotely.
- Decision-Makers: Number of decision-makers required to purchase your product/service has a significant influence on sales models. Complex sales can have an average of five decision-makers creating a barrier to closing sales for most inside salespeople. Where a transaction has only one or two decision-makers, inside sales is well-positioned to navigate the sales process and achieve a positive outcome.
If you consider each of these impact points you will be able to ascertain if investing in inside sales is right for you. To discuss recruiting B2B sales professionals and implementation of inside sales and achieving the right balance in your sales model to minimise sales costs, please do not hesitate to contact us.
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