Inside Sales vs Outsourced Sales: What Is Right for Your Organization?

Many business owners would argue that members of the sales team are the most critical hires for any B2B company’s success. First, there is a need to prospect, focusing on reaching and qualifying new leads through processes like cold calling. Then, those qualified leads need to be nurtured through the sales process. Both steps are highly visible and trackable to the entire organization, so having the right sales team and process in place is vital for the overall health of the business.

There are two main approaches to establish your sales team, process, and build your sales pipeline: keeping your sales team in-house or partnering with a lead generation company to outsource some (or all) of the sales function. Both models have their benefits and drawbacks, so it is important to do your research to ensure you make an informed decision. To get started, let us define and break down what differentiates these models and examine how each can impact ROI.

Inside Sales – Your sales team is employed directly and kept in-house to perform their sales tasks. Your sales strategy, execution, reporting, team management, and quotas are all managed by internal stakeholders.

Outsourced Sales – you leverage an Outsourced Sales Partner’s team of dedicated sales personnel to work on behalf or as an extension of your organization. Outsourced Sales Partners offer various services and can scale involvement in managing your sales cycle and lead funnel. You decide which of their services will help meet your goals and objectives, such as determining who will own the sales strategy.

Now that we are clear on the basic definitions of Inside and Outsourced Sales, let us look at each model’s primary considerations to determine which approach might be the best option for your organization.

Inside Sales for:

Experienced sales leaders and professionals – If your organization has leaders with sales experience, building an internal sales team is a great option. Keeping everything in-house gives you total oversight and allows you or your trusted staff to hand-pick, hire, train, and coach additional sales team members. Not to mention, some leads prefer knowing they are chatting with a direct employee of your company. 

Long sales cycles – If your organization sells highly technical or detailed products with long sales cycles, inside sales could be a better fit for your situation. In a long sales cycle, it is ideal to give leads and customers one point of contact who has extensive product knowledge. In this scenario, you probably would have heard all of the objections that cold calls could stir up, and dug deep into market and buyer persona research [1], ensuring that you are prepared to nurture customer relationships. 

One product or very little change in products – If your product information generally remains constant and no new products are introduced, using an internal team might be the best fit for you. For example, if the product is a piece of software that is purpose-built, has few options, and only receives updates to improve current functionality, an inside sales model could give you the stability and predictability you might desire. 

Outsource Sales for:

Inexperienced sales organizations– If your company is an Owner or even two software developers or product managers, that are attempting to build an internal sales team, outsourcing the sales function might be the best option to consider. Lack of experience and time to focus on the sales function, means the process will not result in the best choices for an internal sales team to succeed. Not to mention the possibility of high turnover, and lack of experience on the team. The average Sales Development Representative (SDR) hire comes with less than 12 months experience and an average tenure of under 15 months (including onboarding). [2]

Remember that outsourcing does not have to be a permanent solution. If you are new to lead generation or testing a campaign, a team of experts supporting your process is exactly what you may need. Outsourcing sales is an effective way to build a successful model to execute and manage their company’s sales function.

Focus on your strengths – If you think there is always an opportunity where leads or customers need to know about your organization and the problems you can help solve for them, perhaps outsourcing lead generation is the right model for you. Get a foot in the door by using an Outsourced Sales Partner to weed out contacts that will not go anywhere, set appointments, and deliver the type of sales-ready leads that you should be focusing on with accurate names of decision-makers to stay in contact with. Meaning you and your internal team can be more productive and spend your time closing the sale, not prospecting. 

New products introduced or product offering changes frequently – If your organization is operating in a volatile or shifting marketplace and you do not want to hire and fire SDRs as needs change, an outsourced partner offers the flexibility and sociability you might need. They can establish contact with prospects in your sales cycle’s awareness stage and share information on the new product. Ultimately, they can maximize the number of dials to your target audience because they have the pre-existing infrastructure.

Especially from a business standpoint, costs are an important consideration. Now, let us examine basic expenses for an inside sales model versus outsourcing. 

Inside Sales:

If you develop an inside sales team, job sites like Glassdoor and Indeed suggest that the average national SDR salary ranges from $48 to $62K. [3] Now factor in training, benefits, hardware, subscriptions to databases, lead databases, and software licensing, which is often 25% of an employee’s salary. [4] If you include allocating management’s time for hiring, team budget, and company resources, one sales team member’s annual costs can jump to over $100K very quickly. [5]

Outsourced Sales: 

If you decide to use an Outsourced Sales Partner, you can select the right company that best fits your sales objectives and budget.

Outsourced Sales Partners’ pricing structures vary, but you’re likely to see a significant savings over an inside hire without those expenses that come with direct employment. Hiring an outsourced sales company comes with already trained sales professionals, the necessary software licenses, and adaptable CRM experience that can easily integrate with any business organization. Outsourced Sales Partners will have their own internal management and quality assurance team to make sure that they are meeting your organization’s needs.

The previously mentioned scenarios are not the only situations that would make inside or outside sales the right move for you to make. When deciding on a sales model, there are important aspects to consider, including familiarity with the product or service, your business model, budget, and your company’s experience with cold calling. Ultimately, your organization has unique needs and goals, which should all be taken into account when deciding on your sales model. 

If you want to learn more about the benefits of outsourcing your sales, read our whitepaper The 5 Benefits of Outsourcing Sales.

SOURCES:

[1] https://ebq.com/outsourced-inside-sales-team

[2] https://blog.hubspot.com/sales/sales-outsourcing

[3] https://blog.hubspot.com/sales/sales-outsourcing

[4] https://www.saleshacker.com/in-house-vs-outsourced-sdrs/

[5] https://blog.hubspot.com/sales/sales-outsourcing