What Is Outsourced Sales?

    Introduction to Outsourced Sales

    Outsourced sales is the act of partnering with an external services provider to partially or holistically manage your sales program. For example, an outsourced sales provider may only handle part of the process, such as top-of-the-funnel demand generation, or they could holistically replace your sales team and manage the entire sales funnel, from lead to close. In recent years, outsourcing the sales function has become an increasingly larger part of an organization’s plan to scale quickly and effectively while reducing costs. According to Statista, in 2019, the global market size of outsourced services grew to $92.5 billion, which is an 8% increase compared to the previous year. While sales outsourcing is only a portion of the broader business process outsourcing market, we should expect it to grow at a similar or faster rate.

    A productive sales program is integral to sustained success and growth, and companies are willing to invest a hefty sum of money to make sure this department is productive. Most companies spend 10-20 percent of their revenue on sales with some high-growth technology businesses spending up to 45 percent of their revenues on sales. With the amount of capital that’s allocated for this function, you need to understand your options to ensure you are making the right decision for your business.

    When evaluating your sales options within your company, you typically have two options: keeping it in-house or choosing an outsourced sales provider. If you’re considering the in-house route, the two most common pitfalls organizations face with this option are costs and inability to scale. Onboarding, hiring, and training new sales reps is expensive, and if you don’t pick the right rep, then you’re potentially sinking a lot of money into a poor investment. Additionally, there are fundamental flaws in the typical entry-level sales program. For example, most organizations hire entry-level or junior candidates to fill a sales development role. Just as that individual is becoming competent within this role, they are promoted to an Account Executive or team management role. This process creates a vicious feedback loop that leaves holes in top of the funnel demand generation each time a promotion from a productive demand generator to a pipeline management role occurs. An outsourced sales partner should be able to instantly add productive sales capacity to your team and will bring perspective and experience from within your industry and many others to the table. Conversely, hiring an entry-level BDR or plucking someone more senior from a competitor will bring limited experience and perspective, which means it will take them much longer to ramp. You should no longer have to worry about the hiring and onboarding process of new reps.

    These are a few main benefits to consider when deciding between in-house vs. outsourced sales for your company. However, there are many more things to consider when looking into whether outsourcing sales is right for you or not. In this article, you will discover everything you need to know about outsourced sales in order to make an informed decision about the direction you should take your sales program.

    Am I a Good Fit for Outsourced Sales?

    The initial thought that needs to be addressed throughout the evaluation process is to determine if you’re even a good fit for outsourced sales in the first place. In order to decide if you are a good fit for outsourcing part, if not all, of your sales program, you should conduct an evaluation of your current process. Before bringing in any outside partners, you need to know what you have in place and how you’re using your current infrastructure. When conducting this evaluation, you should focus on three things: people, processes, and platforms.

    People

    When evaluating your internal team, you should understand who is involved at each stage of your sales funnel. Additionally, you should have clear goals laid out for your reps and have the understanding of how your reps are pacing to your goals. Ultimately, you should be asking yourself the question: do I have the team in place with the proper skill sets to get the job done?

    Processes

    Understanding your sales funnel is crucial to the success of your business. Without this knowledge, you will not be able to align your funnel to your business goals. Creating a clearly defined sales funnel ensures that you will be able to track the progress of your leads easily and understand where you have breakdowns in the process. Diving deeper, you should evaluate all processes that relate to the different aspects of your sales funnel. For example, what processes are used to generate top-of-the-funnel demand? Are they effective? More importantly, are they cost-efficient?

    Platforms

    Lastly, you need to understand what infrastructure you have in place to enable your team to succeed. What CRM do you use? What sales enablement platform do you use? How does your website look and compare to others within your space? These are just a few of the questions that you should consider when evaluating your tech stack.

    Once the evaluation is complete, you should then pay attention to these four factors in order to determine if you need to improve your sales function:

    Many companies are unable to answer most of the above questions, realize one of the four factors is dragging down their business, or have no idea where to even begin to evaluate their current programs. If this is the case for you, then you should consider outsourcing sales to gain insight into your people, improve your processes, and organize your platforms.

    How Much of the Sales Funnel Can I Outsource?

    When organizations turn to outsourced sales, they typically think about appointment setting. However, there is so much more you can do when it comes to outsourcing part, if not all, of your sales function. You can outsource as much or as little of the sales funnel as you would like, depending on where you need the most help so long as you have a plan in place.

    Demand Generation

    Starting at the top of the funnel, many companies use an outsourced sales provider to generate demand for their organization. Using outbound channels, such as teleprospecting, email, calling, and social media (LinkedIn), providers will source contacts and set meetings for your team to work. Quality of meetings can vary significantly from provider to provider, so be sure to be specific about your demand generation needs.

    Lead Qualification

    Moving down the funnel, providers can also implement a qualification process on behalf of your organization. This typically involves some sort of initial introductory discovery call to understand more about the lead’s interest in your company. The goal of this call is to determine that leads have the right profile and a basic fit for your product, service, or solution, and begin to qualify against your preferred sales qualification process (ie. BANT, Meddic, etc.)

    Pipeline Management

    If you need more bottom-of-the-funnel help with your sales program, pipeline management enables you to implement a strategy for becoming pipeline productive. Providers use some sort of qualification tactic (e.g. BANT qualification) to determine actual opportunities to build up your pipeline, and then work to convert that pipeline to customers.

    Closing

    Lastly, few outsourced sales companies offer “closers” for your business. These are essentially outsourced Account Executives that are capable of closing on behalf of your business. This strategy will enable you to create a system for becoming financially productive with your sales program through outsourcing. 

    Metrics

    When considering your sales funnel, it’s imperative to keep your funnel metrics top of mind. Every good B2B sales funnel should pay close attention to the following metrics:

    • Sales Accepted Leads (SALs) - The number of meetings that you book with leads who match your buyer persona
    • Cost Per SAL - The total cost that it takes to create 1 SAL
    • Sales Qualified Leads (SQLs) - The number of meetings that are held with leads who match your buyer persona, and your company has a solution that can solve the lead’s problem
    • Cost Per SQL - The total cost that it takes to create 1 SQL
    • Opportunities - The lead is qualified against BANT, Meddic, or some other qualification framework
    • Cost Per Opportunity - The total cost that it takes to create 1 opportunity
    • Closed Won Deals - The lead has signed their contract and is now a customer
    • Customer Acquisition Cost (CAC) - The total cost that it takes to create 1 customer

    These metrics are the standard when it comes to measuring your sales funnel. Some metrics, such as cost per meeting, are great in some situations; however, the metric fails to distinguish the quality of the lead. Using the above metrics, you will be able to implement a detailed, organized sales funnel for your team.

    What Are the Different Types of Outsourced Sales Providers?

    There are many different types of outsourced sales providers ranging from staffing agencies to full-service agencies. In this section, you will learn about the five main types of vendors and how each could benefit your business.

    Full-Service Agencies

    Full-service agencies are exactly what they say. If there’s an aspect of the sales process that you can think of, this type of agency can handle it. They can execute each part of the funnel, from demand generation to closing. They can create sales playbooks based on your ideal customer profile. Or, they can work alongside your company to help you scale your sales program. 

    Furthermore, full-service agencies can handle both inbound and outbound leads and are not restricted to unproductive channels. In other words, they will continue to test and work until they find a productive channel for your business. There are not too many providers that can do this well, so make sure you evaluate your options thoroughly and carefully. If you need a robust solution or to overhaul your sales programs, then you should look into a full-service provider.

    Rent-a-Rep Agencies

    Rent-a-rep agencies supply your organization with sales execution professionals who become essentially a part of your team. Vendors supply you with individuals who work solely on selling your product in whatever capacity you need them. The main benefit of this type of company is that it’s a mid-cost service that your business can take advantage of if your business has a repeatable and thoroughly documented sales process. 

    Sales Team Staffing Companies

    Sales team staffing companies are a way for you to quickly source sales reps but without the recruiting costs and headaches that go along with maintaining your own sales force. In this model, you’re usually required to train and manage the “staffed” sales rep as if they were an FTE at your company.

    Appointment Setting Companies

    Appointment setting companies provide demand generation services for your organization. They book meetings for your team and pass those leads over to you. If you need help with your top of the funnel, then appointment setting is likely the direction you would need. However, when evaluating appointment setting companies, you need to be careful. There are many different appointment-setting agencies out there, so be sure you do your research and find one that fits your needs.

    Fractional Sales Companies

    Fractional sales companies provide your company with a senior sales executive to manage your team. In other words, fractional sales companies offer consulting services for your business. Typically, this type of outsourcing is preferred by companies that are relatively small and looking to grow or that are undergoing some sort of internal change.

    How Much Does an Outsourced Sales Vendor Cost?

    The cost of your outsourced sales vendor typically depends on the route that you choose. The two most common types of sales providers are full-service agencies and staffing companies. With this in mind, full-service vendors typically cost between $10,000-$50,000 per month, but can typically scale to suit your specific needs. As mentioned in the previous section, these types of services provide all of the services to help your sales team thrive.

    Additionally, rent-a-rep agencies can provide your team with a sales execution professional for $9,000-$10,000 per month. If you have a team of 5-10 reps, the flexibility you receive from this type of model combined with the cost savings could prove pivotal for your company, especially as you continue to scale and grow.

    Why Should I Consider Sales Outsourcing?

    Outsourcing your sales efforts offers myriad benefits for your organization. In this section, you will uncover why you should consider outsourcing sales as part of your sales program.

    Reduction in Hiring, Training, and Retaining Costs

    With an outsourced sales provider, you no longer have to worry about hiring and training costs associated with internal reps. Vendors are responsible for providing you with fully trained personnel. While you may be able to hire an entry-level rep for less than what your typically outsource sales contract will cost, you will incur significant hard and soft costs associated with retaining that employee. In addition to costs, there are significant risks and opportunity costs related to non-performance and other human capital concerns.

    Master and Define Your Sales Funnel

    Outsourced vendors offer a third-party eye to your current processes. As a result, these providers can help you define and ultimately master your sales funnel. Usually, they’ll have time-tested and proven processes that they can implement to help optimize your program.

    Reach New Markets

    If you’re interested in exploring and expanding into new markets, outsourced providers are a great way to begin testing. You don’t have to sacrifice any internal resources when trying something new. When utilizing an outsourced sales partner to expand into a new region or market you should be able to begin prospecting and penetrating instantly, whereas deciding to hire internally will take weeks or even months before you are even ready to begin prospecting.

    Access to Experienced, Trained Professionals

    Outsourced sales providers eat, sleep, and breathe sales. They have highly trained and experienced professionals that know how to execute an effective sales program. Additionally, qualified providers will draw from experience across many industries and use data-driven strategies to generate results for your organization.

    Additionally, when evaluating all of your outsourced sales vendor options, one potential factor that may come into play is the idea of offshore vs. onshore outsourcing. Providers that use offshore resources are likely cutting internal costs and may not be able to provide you with top-of-the-line sales talent. Vendors with onshore staff have likely made the necessary investment to ensure top talent and happy employees.

    Immediate Onboarding

    While onboarding new reps can take months, onboarding an outsourced sales vendor can take only a couple of weeks. These companies have processes in place to ensure efficient and immediate onboarding.

    Refocus Your Attention onto Core Competencies

    By outsourcing some, if not all, of the sales function, you can refocus your attention on what really matters to your business.

    How Do I Choose an Outsourced Sales Partner?

    Now that we’ve covered almost all things outsourced sales, there is one last question you still need to answer: how do I go about choosing a provider? When choosing your outsourced sales partner, you should understand these three key factors:

    The Success and Steps of Their Sales Process

    First and foremost, you need to understand if the vendor has had previous success within your industry. If they can demonstrate this, then you should take steps to understand how they execute their sales process. Not only will this help your internal team, but it will also help you understand what a successful sales program looks like for your industry.

    How Their Reps and Team As a Whole Are Treated

    You should take the time to understand what motivates each provider’s reps as well as the general work culture of the vendor. Happy and motivated reps are the best sales execution professionals.

    Their Hiring and Training Process

    Lastly, you should try to understand how each outsourced sales provider hires and trains its reps. You want to ensure that they have top talent in the field and are thoroughly trained for what you need.

    If you use these three factors when evaluating your outsourced sales vendors, then you will be sure to choose the right provider for you each time.

    Final Thoughts about Outsourcing Sales

    Sales is a crucial function within any organization. In most cases, it will make or break your company from being able to grow and scale properly. With the rise of outsourced sales in recent years, companies realize they no longer have to operate their sales programs within a vacuum. Organizations are partnering with providers that enable them to cut costs and grow their business based on their company-wide goals. As a result, outsourced sales will become an integral part of any company’s sales process.

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