Building A Small Business Sales Strategy With Limited Budgets

Anand Srinivasan

February 29, 2016

	Not rated
	Rate:

Small business owners often face the classical 'chicken and egg' problem while building a growth strategy. Growth is not possible unless you expand your resources, which one may not have without higher revenues/growth. This is a major reason why very few businesses manage to break the shackles and establish themselves as medium or large businesses. This does not however mean that it is not possible. Businesses with aggressive growth strategies often focus on profit centers like marketing and sales with lesser focus on cost centers like R&D.

For small businesses with very little cost-center expenditure, it is easier to plan an aggressive sales strategy without breaking the bank. With larger focus on sales, there tends to be a commensurate increase in revenues and in turn growth. The following tips will help a small business with a quick do's and don'ts list to spruce up their business.

Don't Pick Commission-only Sales

One of the first things business owners often look into is commission-based sales executives who do not charge a monthly salary and would instead agree to work on higher commissions. The rationale is that such a model allows business owners to not spend up-front and only make use of additional profits to pay sales executives. The trouble however is that it is difficult to build a dedicated sales-force using this model. Regardless of the quality of the sales executive, they require training and time to start selling your products. A commission-only structure denies sales executives this luxury. The result is that while your business can avoid high payroll expenses, there is also high churn in your sales team with little or nothing to show in terms of revenue growth.

Outsource Sales Process

Instead of hiring dedicated sales manager on commission basis, it is a good idea to outsource this component of business. The advantages are two-fold: Firstly, you keep expenses low without additional employees in your workforce. Secondly, since outsourced service providers already have a network of clients they work with, you drastically reduce the training period thereby seeing quicker sales cycles. In addition to this, one of the key benefits to outsourcing your sales to a third party provider is the opportunity for cross-selling. Third party sales service providers work with multiple clients. As a result, they are often in a position to cross-sell products from various clients to their customers. This helps in improving conversion rates and sales cycles that justifies your outsourcing costs.

Outsource Sales Recruiting/Training

Some businesses may not want to hire a third party sales agency because of issues pertaining to confidentiality or compliance. Some industries, such as financial services, have strict compliance regulations and it can often be difficult for a business owner to trust a third party with critical legal issues. In such cases, it may seem like a better idea to have your own sales force. However, a major component of sales expenditure is in recruiting and training workforce which is a good area to outsource. So when it may seem infeasible to outsource your sales force, it is an equally cost-effective strategy to let third parties take care of the recruiting and training based on years of specialized data. This way, businesses can focus on building and managing their product instead of spending resources in sales.

Recruiting, training and owning your own sales team is what businesses would prefer ideally. However, depending on your industry and the stage of business you are in, it may seem like a better idea to offload the non-core competencies to specialists. Have you outsourced the sales component of your business? What other strategies did you use to deploy a strategy cost-effectively? Let us know in the comments.