Wednesday, January 7, 2009
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Increase Your Pipeline: Deploying the Cost Effective Sales TeamBy: Andrew Rowe
Based on my talks with local executives, indicators point toward our getting back to business. Many companies that were taking a wait and see stance on Sales are now beginning to once again invest in selling.
As we all know from the go-go days, deploying a new sales team takes significant investment, especially if the sale cycle is lengthy. When venture investment was pouring in, I saw scores of companies spend months building and investing in a sales infrastructure before a single call was made! Their new sales VP would first start his search for regional managers who would subsequently recruit field reps. And then, after the grand sales kick off, it was 6-9 months before the first sale! This just isn’t practical for most companies, regardless of the economic environment.
Over the years, however, I’ve seen an extremely cost effective model being implemented by guerilla companies not flush with cash. The concept leverages the best of both inside and outside sales departments. If you run the numbers, you will see that an inside team is a fraction of the cost of an outside team, especially when you factor in travel, entertainment and other field related expenses. Additionally, an inside lead generator can double – even triple – the effectiveness of an outside representative.
Consider this: If a rep needs to make 100 contacts to generate 5 appointments, then he is essentially wasting 95% of his calls. Okay, it’s not really wasting time, but if the sales reps were in front of qualified prospects instead of talking to unqualified suspects, then their productivity would be significantly increased. The most cost effective model I’ve seen has been to employ inside lead generation to support the outside sales efforts. Rather than hire 3 outside reps, consider hiring 2 outside reps and 1 inside lead development or inside sales rep to support them. The immediate benefits you will see include:
Reduced payroll
Reduced field costs
Centrally managed lead development process
Increased productivity of outside reps
More appointments into target accounts
Better coverage of marginal accounts in dispersed geographic areas
Cube Management provides sales acceleration services to emerging growth and mid-market companies in the technology, manufacturing, healthcare and business service sectors. The experts at Cube Management work across the entire spectrum of marketing, sales and business development to provide customized solutions that drive revenue and profit growth. Cube Management combines Strategy, Process & People to produce winning results.
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