Strategic Sales Approaches

Let’s be honest. Selling is perhaps the most important role for your company and is one of the toughest jobs. A healthy company needs revenue growth to thrive. And you need happy, satisfied customers to have a chance to get them to buy more. Plus, you need a sales leader, and his or her team, that can get you into new accounts as well.

It is no wonder that turnover among sales folks is as high as 35%. Sometimes turnover is due to missing ambitious sales targets. Other times your best sales leaders get recruited away for more pay or a promotion.

Decisions and Choices

Basically, there are two primary sales approaches to consider. One is to hire and build your own direct sales team. The other approach is to outsource selling by hiring a brokerage firm. There are pros and cons to each option.

Direct Sales

Many smaller businesses prefer to create and staff their own dedicated sales team. Yes, it can be costly, as you must consider compensation (base pay and commissions), travel and meetings, samples, sales technology (like customer relationship management systems), and training. And, since it is so important to your success, it takes a chunk of your time to get set up and then evaluate for results.

Pros

You have a team that exclusively focuses on your products and services—no distractions, no excuses. The odds of your dedicated sales team getting to intimately know your customers and building win/win relationships are pretty good, as their careers depend on it. And getting revenue wins is a big deal!

Once you have an experienced and talented sales leader in place, you can negotiate revenue goals and expenses. After all, you both will have to live with those agreements.

You will both be aligned on what success looks like and can dialogue regularly on how it is going, with the chance for rapid course corrections to address variances to budget.

Your sales team will get feedback from your customers that can help you improve your products and value proposition.

Cons

Even with a good team in place, you will find that you spend a lot of time with your sales team. That time takes you away from other key aspects of running your company.

The return on investment for a dedicated sales team may be challenging early on. This may test your patience and ability to fund it fully.

If sales is not your core competency or it is an area of personal weakness, it may be hard to truly judge the talent and performance of your team. And those people-related decisions are important. Yes, you hope to hire a top-notch head of sales whom you can trust. But sometimes, even with the best of intentions, you will find that you may need to change some sales personnel. And that takes time to hire replacements and get them up to speed.

Sales Brokerage Firms

The other approach is to hire an experienced broker to handle sales for you. You basically outsource the sales function to a respected broker to represent you and your products. This option is a legitimate way to go-to-market, especially for younger companies.

Pros

Brokers are “hired guns” who have solid connections and relationships with the customers that you want to sell to. That is what they do and that is what they get paid to do. And they are good at selling—which frees up valuable time for you.

Since they are actively selling every day, their level of insights into competitive dynamics and what it takes to succeed is quite good. This can be a source of feedback that you can put to work.

Brokers tend to be a lower cost approach, as they can spread their overhead expenses across multiple clients. Yes, you will negotiate commissions (which typically range between 5-7% of sales) and the specific elements of your sales plan (distribution incentives, trade deals and discounts, pricing and billing, etc.). But you would be putting together your sales plan in either case.

Cons

Brokers represent a number of companies. As a result, you will be competing for their attention and focus. Yes, their pay is directly tied to their success in selling your products. But other clients may offer a more lucrative compensation scheme or have a new product launch that may represent some upside for them. The bigger the broker, the more likely it is that they represent lots of clients.

Brokers may not share the same core values as you do. Those values make you distinctive and you may have invested time and money to establish them. The more differentiated your product is, the more likely this may be a concern for you. That said, if values are important to the sale of your product, you can equip your brokers with the story and tools to properly represent you and your company.

Lastly, brokers often require exclusivity, particularly for a given geography or channel of trade. This is likely not contentious unless it makes you uncomfortable to give up that level of control. Having exclusivity is another motivation for your broker to work hard for you.

Selecting your sales strategy is one of the most important decisions you will make. Your confidence in both the approach and the sales leaders will help you sleep better at night. And make no mistake, you will inevitably be intimately involved in how well it works. Making a change from one approach to the other is possible. However, it is a bit disruptive, with some transition time to consider.

Want some help?

At Forge, we thrive on helping clients get to the next level and charting a course for your success. We are here to be your partner, your trusted advisor, your devil’s advocate. And we will always bring the conversation back to strategy. How do we best get you onto the best path—one that has the greatest potential to get results.

Importantly, we are pragmatic, focused, nimble, smart, and energetic. We get assignments done well, and quickly.

Take the first step to a more successful business today.

1.    Hit “LET’S TALK” to schedule a free 30-minute discussion. No pressure – we promise.
2.    We’ll provide real-world case studies showing the process in action.
3.    If we’re a fit, we finalize the details and get started!

Leave a Comment

Your email address will not be published. Required fields are marked *