Businesses around the world continually look to streamline their operations, with the ultimate goal of saving money on overhead costs. Cost-effective strategies can improve profitability, and nowhere is this more important than in sales. Outsourced sales operations are being adopted by companies of every size and type, allowing them to reach new audiences, reduce risk, and generate leads.
With this cost-saving opportunity, an outsourced sales team can transform sales operations, leading to improved revenue streams and new customers by leveraging the power of a dedicated, full-time staff.
In this guide, we’ll explore the concept of sales outsourcing, including outsourced telemarketing services, Then, and how this practice can save money, improve efficiency, and stimulate business growth.
How Outsourced Sales Companies Help
In simple terms, sales outsourcing or “outsourced sales” is turning over the sales process operations (or a part of them) to an outside agency or individual. There are many outsourcing service providers, each with their own unique way of conducting these operations. Such providers have extensive training and protocols, and many employ advanced technologies to track customer engagements, providing detailed data to the clients they are working for.
Can Third-Party Resources Really Improve Sales Processes?
When one thinks of using a third-party sales team to improve the operation, many companies tend to misunderstand the value inherent in this type of arrangement. Trying to revamp the sales model without farming out to a third party can often lead to trouble. Examples of potential pitfalls companies may experience when trying to save money on costs include:
- Utilizing indirect providers and services, such as product/service resellers or so-called “solution partners”.
- Handing over sales to employees not qualified or experienced enough to handle the unique tasks. Imagine what would happen if your product engineers also handled sales functions , including reaching out to potential customers – doing so could be a recipe for disaster.
- Trying to create new opportunities by adding commission-only professionals or agents to the mix. In a loose sense, the above examples are forms of outsourced sales, but the reality is that these three examples are situations a smart company will avoid whenever possible. Effective providers have the experience, the tools, and the tactics needed to handle the most critical aspects of operating a business: Engaging with potential customers.
Challenges in Sales
Many small business operations struggle with the challenges of reaching new customers. The process of sales – attracting new customers and converting contacts into transactions – is already challenging enough. Small companies can face significant hurdles in this department. These hurdles may stem from a lack of experience on the sales team, especially in lead generation and marketing techniques, or may require expenditures a company and its staff are unprepared for.
Advancing Technologies and Sales Verticals
Advances and shifts in technology can also create complications in the sales and marketing arena. New technologies and ever-changing practices become available on a constant basis, and these new features may force a company to adapt its selling approaches quickly. For example, changes in communications tools or evolution of customer preferences may necessitate a revised sales practice to leverage successfully, and many companies do not have the flexibility or experience needed to do so. Social media marketing is an illustration of shifting consumer preferences; using social media platforms effectively has been difficult for many business operations unfamiliar with the tools and techniques needed to succeed in this arena.
In-House Sales Team Costs
Costs represent significant challenges companies face in selling. Overhead costs are always a concern, regardless of the size of the business in question. Having a rep or two in the office is not cheap. Doing more with less has become the mantra in the modern business world, and this has dramatically altered the sales process.
Unfortunately, without careful evaluation and overview of practices, costs can run out of control. The direct costs associated with in-house sales efforts, particularly the cost per lead generated, can harm a company’s profitability, especially as these costs increase over time through inefficiency. It is clear that a solution is needed to rein in costs and to improve efficiency. That solution is the outsourcing of inside sales.
Which Companies Can Benefit from Sales Outsourcing?
It can be argued that any business can benefit from sales outsourcing. This system tends to help improve efficiency, reduce costs, and leverages sales expertise and sales development. Still, there are certain business categories that receive greater value from the outsourced model than others. These include:
- Emerging growth and start-up companies
- Technology firms
- Medical device
- B2B business ventures
- Financial Services etc.
Each of these business types do not typically have a focus on sales. For smaller ventures, a lack of experienced sales staff or staff focused on daily operations can sometimes get in the way of business growth. Taking on sales initiatives can prove overwhelming. For these companies, outsource sales makes a lot of sense and can help produce the desired results at a fraction of the costs of an in-house sales team.
Lead Generation: The Key to Success in Outsourced Sales
The generation of leads is a critical component and end-goal of any sales team. Locating and targeting potential new customers is always the goal for businesses that wish to enjoy continued growth. The process of lead generation, unfortunately, can be expensive in terms of funding as well as in time, and that is where outsourced sales partners can provide distinct benefits.
3 ways outsourced sales initiatives can help lead generation
According to HubSpot, 85% of top B2B marketers say that lead generation is the most important goal. Over 60% of all business owners indicate that generating traffic and leads is the biggest challenge they face in their work operations. How can sales outsourcing produce the leads needed for companies to thrive in competitive marketplaces? There are three factors that influence lead generation:
- Outsourced sales providers are adept at cold-calling and appointment booking initiatives.
- Sales providers typically have proven strategies for producing leads, and these strategies have been honed to produce the best possible results time and again. The best service providers and sales partner will share their results and histories with potential clients.
- Many companies simply do not have the resources to establish an in-house team. Outsourcing sales takes the headaches out of the equation, providing the expertise needed to identify and reach new customer bases in the most efficient manner possible.
Benefits of Outsourcing Sales & Marketing
Sales and marketing outsourcing can improve both lead generation and execution for businesses. Highly-trained professionals use the latest tools and technologies to improve efficiency. An outside sales team is just that: a team of people working for a company that manages these practices all day, every day. With that kind of focus and that blend of training, tools, and results-driven performance, handing over sales to a third-party provider begins to make a lot of sense and can make a significant improvement in achieving your sales and marketing goals.
The first cost-saving advantage lies in this capability; while sales units in a given business may need to experiment with techniques or strategies as a marketing campaign begins and before the desired goals are achieved, an outsourced provider is ready to produce results right away. This slashes overhead costs, particularly when ramping up a new initiative for a company.
Tracking & Tools
Leading service providers also use rigorous tracking and reporting tools as a means of providing detailed information to their clients. This is a tremendous advantage in terms of direct costs such as cost per lead. In-house teams sometimes suffer from an inability to pinpoint leaks in the sales funnel, or may not be able to understand why certain leads are lost at different points of the campaign.
The outsourced team, such as an outbound telemarketing team, collects and analyzes data to improve customer touches and generate leads efficiently. A related advantage is the safety net of responsibility: in order to succeed, an outsourced sales provider must produce results, and that means bringing in new customers and closing deals. To achieve these results, the provider takes on a significant portion of the risks involved in outsourcing sales and marketing and is thus responsible for delivering results.
Other Advantages of Third-Party Sales
There are many more advantages companies can enjoy when choosing to farm out sales to a third-party provider. To summarize the many advantages of outsourced marketing and sales practices, the benefits include:
- Time and Cost Savings – outsourcing teams are equipped with the tools and knowledge to get campaigns up and running quickly, ultimately saving money over in-house operations.
- Reduced Risk – by outsourcing some or all of its sales, it is also outsourcing some of the responsibility to a third-party provider. This can be an effective risk management strategy, especially for smaller businesses in competitive market sectors.
- Improved Performance – outsourced telemarketing professionals and teams have the experience, the focus, and the training to deliver results.
- Market Expertise – there are many third-party providers that have unique insights into specific markets, giving them an advantage for specialty sales. These insights can spur new ideas and new ways of connecting with customers in a given market niche.
- Safe Business Growth – many smaller firms do not have the budget or the resources for a dedicated in-house sales and marketing team. By engaging with an outside provider, they can gain the advantages of a dedicated team without the overhead and training costs associated with creating their own department. This can help the business grow safely, without unnecessary risks or expenses.
Should I Outsource Sales or Not? Potential Drawbacks
In any sales venture, there are advantages and drawbacks to be aware of. The same applies to the concept of outsourced sales and marketing. It is important to note that the advantages of outsourcing greatly outweigh the potential drawbacks, but business owners need to understand that certain pitfalls may negatively impact business prospects.
(Most) outsourced sales teams are not a full-time resource
The first drawback is that *most* outsourced sales resources are not dedicated. Larger, more established businesses typically have their own sales departments and processes that have been refined over time. It may not make sense for these companies to use sales outsourcing models but still may provide benefits. Smaller companies, particularly startups, do not have this drawback and are not typically equipped with experienced sales professionals.
Sales outsourcing service providers, then, provide great value for these ventures and can help advance their marketing effort. Another drawback lies in the methodologies used. In-house sales teams may have developed marketing tactics and strategies over time, and these strategies produce the desired results. An outsourced sales team may apply different tactics, and sometimes these do not mesh well with the methodologies the company already has in place. To help overcome this potential drawback, it can be beneficial for the two entities to meet and to learn each other’s sales and marketing methods to ensure continuity.
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Choosing the Right Outsourced Sales Services
Now that we understand sales outsourcing and have explored a few of the many advantages of adopting this model, the question becomes: How does one choose a provider?
Different companies have different needs and varying goals. Some companies may find a benefit from outbound telemarketing options, while others need a full suite of inside sales services. Many companies can benefit from a dedicated customer service department tied to the sales operation, such as a call center.
Identifying Sales & Marketing Needs
The first step in evaluating a service provider is to take a close look at the specific services the outsourced sales companies offer to their clients. Some may offer customized sales solutions, while others may incorporate a range of services into one package including email marketing strategies. Make sure that whichever provider you choose for your company’s growth has the services you need to make the sales development as efficient and as effective as possible.
Some outsourced companies specialize in specific fields, such as healthcare, technology, agriculture, or defense contracting. These providers can be invaluable in taking sales to an entirely new level and have industry knowledge that is critical in connecting with customers. If your company occupies a unique niche in your market, it is a good idea to seek out specialty providers to help do the work for you, if available.
Capabilities are the most important consideration, yet too many companies focus solely on the costs associated with outsourcing sales work. While settling on the lowest-cost provider sounds like it makes sense, the reality is that budget-oriented service providers rarely have the technology, the experience, or the mastery to achieve the desired results. Remember: it is more important to partner with a provider that can deliver the work product.
Create A Partnership
Finally, understand that in order to achieve the results you want from your sales services provider, it is important that the provider is able to create an active partnership built for the long-term. Demand interaction from your provider, especially in terms of regular data collection and reporting practices. The stronger the business relationship, the more capable and successful the partnership between business external providers. Many will ensure customer success if the agreement is done properly.
Contact SalesFish today to speak to a sales expert.