Sales outsourcing enables small SaaS startups and large corporations alike to delegate part of their sales processes to a third-party agency. The right sales outsourcing firm will serve as a seamless extension of your current sales team (or in some cases) will serve as your entire sales team. From market research to lead generation and outbound calling, outsourced sales teams can manage all aspects of your sales needs.
SaaS organizations, especially those in their infancy, are keen to hire outside sales consultants to mitigate costs and risks while still investing in high growth sales potential. According to a report by NNC services, outsourcing sales functions such as lead-generation can deliver 43% better results than an in-house team. In this article, we’re diving into the top 5 reasons SaaS organizations of all sizes are outsourcing sales.
1. Internal SaaS Sales Teams Have a High Churn Rate
Unfortunately, at 67%, SaaS in-house sales departments have one of the highest voluntary churn rates. A recent Forbes article states that the high churn rate is partially due to the high cost of an in-house sales team. Small startups may not have the financial bandwidth to meet competitive salary requirements, leading to poor employee satisfaction and retention. Not to mention, the Great Resignation — the post-COVID movement where roughly 33 million Americans have quit their jobs since the spring of 2021 — continues to cause an upheaval in employee retention rates across the board.
Additionally, SaaS companies excel at the product/service they offer and that’s where their expertise lies. However, many SaaS organizations are ill-prepared to manage a sales team effectively or are able to hire qualified leaders to do so in-house due to high costs. Thus, with little to no standardized sales training and coaching, the sales team will likely be running on chaos and disorganization. The lack of proper sales training can lead to low employee engagement and even lower sales revenue.
Sales outsourcing is a surefire way to either eliminate the need for an in-house sales team or to hire outsourced sales coaches to:
- Train your reps on best practices
- Benchmark your sales team
- Understand what your sales reps are capable of doing
- Identify opportunities for improvement
- Work to improve employee retention
2. Sales Outsourcing Reduces Costs
Testing out new markets and scaling a sales team is stressful, time-consuming, and costly. According to Bain and Company, SaaS organizations are typically spending approximately 15% to 20% of their revenue on general and administrative expenses including:
- Employee salaries
- Rent and utilities
- Insurance payments
Sales outsourcing firms are cost-effective and can:
- Eliminate salary requirements
- Mitigate hiring and training costs
- Eradicate the need for extra office space
3. With Sales Outsourcing, You Can Step into New Markets Quicker
Opening and testing new markets or products is an expensive and often high-risk task for SaaS organizations to undertake. An outsourced sales team can build a sales process from scratch quickly and efficiently to help your organization reach new markets based on adequate market research. Essentially, sales outsourcing provides a unique opportunity to explore new frontiers while displacing the risk and investment.
Leveraging an outside expert sales team to do the heavy lifting enables you to try out various strategies on new audiences without fear of:
- An unclear vision from leadership
- Sudden staff changes
- Lack of coordination
- Cultural differences leading to failed market entry
- Lawsuits, patent rights, and data privacy regulations
Discover best practices for building a new market entry strategy and gain a deeper understanding of how hiring an outside sales consultant can help you step into a new market with little risk in our white paper, Winning Strategies for New Market Entry.
4. Increased Scalability and Flexibility
Sales outsourcing increases your ability to scale without having to train and onboard new sales reps yourself. As your company grows, the outsourced sales team can seamlessly grow with you. For example, if you find yourself caught in favorable market conditions, utilizing an outside sales team to apply a temporary rapid scale is a great way to seize a fleeting opportunity.
Additionally, many emerging SaaS organizations rely heavily on the founder for sales execution. However, this process is unsustainable as the founder needs to focus on more pressing issues such as… the business. To scale effectively, you need to shift gears to bridge the gap between a founder-driven, individual approach to selling, and a repeatable, scalable sales process. This is a huge challenge, especially in start-ups where founders are the heart and soul of their ventures. Here’s where sales outsourcing comes in handy.
An outsourced sales expert will:
- Assess your needs and perform a gap analysis on the strengths and weaknesses of the company, as well as the tools that are required to scale.
- Provide recommendations for how to reconfigure the sales organization based on assessment results.
- Leverage their knowledge and experience to pattern-match sales techniques to other successful organizations.
Learn how to effectively scale your sales by downloading our white paper, How to Scale Sales Beyond a Founder: Best Practices for Achieving the Next Level of Growth.
5. Your Staff is Freed-Up to Focus on Your Core Operations
On average, in-house sales reps spend just about 23% of their time actively selling. The rest of their time is spent on low-value administrative tasks like creating sales reports, writing proposals, and other paperwork. In organizations where the Great Resignation heavily impacted staffing, the amount of time sales reps are able to actually sell is limited. With fewer sales reps, the sales team is spread too thin and is not able to prioritize their current buyers and prospects. Yet, with sales outsourcing, your core sales team is able to spend their time:
- Actually selling to prospects
- Delighting current customers
- Innovating new ideas and ways of selling
- Reaching new goals
Meanwhile, the outsourced sales team is able to focus primarily on activities such as:
- Lead generation
- Uncovering new territories and markets
- Market testing new products
Generating sales qualified leads
SaaS organizations are among some of the most innovative and transformative organizations in the world. In order to gain a competitive advantage, SaaS organizations, regardless of size, need to consider sales outsourcing as a viable solution to maximizing their sales initiatives without overwhelming their current staff.
Interested in hiring an outside sales firm? Let us help you go to market with a high-level sales strategy and a team to support it — contact us.