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Guide: In-House vs. Outsourced Sales Development - The Costs You Should Consider
We’re pretty excited over here at Leadium today.
Not only because we're releasing our newest guide, “In-House vs. Outsourced Sales Development - The Costs You Should Consider,” but also because with the release of this guide we are furthering our commitment to educating and empowering small to medium-sized businesses (SMBs) everywhere with the resources they need to accelerate their growth with outbound sales - in a way that doesn’t hurt the bottom line and keeps margins high.
Based on our experience working with hundreds of SMBs across the country, 65% just aren’t at the size or run-rate to allow for the economic investment required to establish a successful in-house sales development team. Hence the reason they are coming to us as their outsourced sales development partner.
But also, it got us thinking - how many more thousands of high-growth business owners and stakeholders are out there, right at this moment, are thinking they have to build internally because “that is the way it is always done” without truly evaluating all of the costs that go into it?
As Scott Barker mentioned in this Sales Hacker Webinar (where Kevin chatted about one of his favorite subjects: the ROI of using an outsourced sales development partner) engineering teams at large companies consistently hire off-shore developers and marketing teams across industries hire creative agencies to lead their advertising campaigns. Why do sales professionals still consistently think it has to be all in-house or nothing at all?
As you read time and again, and reported by CBInsights, one of the top reasons why startups fail is that they simply run out of cash. Therefore, in everything you do - from choosing an office space, to swag options, to how to structure or build a team - cost should be one of (if not THE) top decision-making factor.
In-House or Outsourced - That Is the Sales Development Question
As a high-growth SMB, your number-one focus is consistent sales. Customer acquisition drives revenue, and revenue becomes your means of growth. Therefore, you are (hopefully) constantly evaluating how you will get your next customer.
Without enough high-quality leads, your sales pipeline dries up fast. Without a sales development team, you can find yourself struggling when it comes to pipeline generation. You can use lead-sourcing technology and sales automation, but you still need people to power those tools.
When you want to improve (or even just start) your sales development program, you’re faced with a pivotal strategic decision: do you hire an in-house sales development team or work with an outbound sales partner?
Download the complete “In-House vs. Outsourced Sales Development - The Costs You Should Consider” here.
It’s a big decision and there are many cost factors to weigh.
We’ve drawn on our combined two-decades-worth of experience in the outbound prospecting and sales development world to pack 16 pages full of analysis, insights, and research to reveal the true costs of what it takes to build an internal outbound sales development program.
Then, to help you make the right decision for your business, we compare those dollars to the costs and benefits of using an outsourced partner.
In this guide you will not only learn the key components that go into building an outbound sales program, but also how to:
Weigh Salary & Other Personnel Costs
- The base salary of a single SDR equates to only about 40% of the true cost of that one employee.
- There are at least six additional costs that you need to calculate into a single hire’s true value.
- Consider training, on-boarding, and software costs for each new hire as a key line item for your in-house build budget as well as the management salaries that will run each of these programs for you.
- Then compare these costs to the size of team, level of expertise, and access to technology that you get using an outsourced agency - and at what fraction of a price.
In this guide you will not only learn the key components that go into building an outbound sales program, but also how to:
Weigh Salary & Other Personnel Costs
- The base salary of a single SDR equates to only about 40% of the true cost of that one employee.
- There are at least six additional costs that you need to calculate into a single hire’s true value.
- Consider training, on-boarding, and software costs for each new hire as a key line item for your in-house build budget as well as the management salaries that will run each of these programs for you.
- Then compare these costs to the size of team, level of expertise, and access to technology that you get using an outsourced agency - and at what fraction of a price.
Assess the Cost & Functionality of Sales-Enablement Software
- Software is a big part of sales development. Your reps will need a powerful CRM, as well as an outreach tool, an email validation tool, business email accounts, and more.
- We reveal the price tag and considerations that businesses, who are building their outbound program, should be aware of when deciding on major sales-enablement software players including Outreach, HubSpot, InfusionSoft, SAP, Salesforce, and LinkedIn Sales Navigator.
- Consider the on-boarding and training costs per user, per software that you purchase as well when building your program in-house - all costs that have already been accounted for and thoroughly trained on at outsourced teams.
Calculate the Cost of Data
- What is your solution for filing your pipeline with qualified leads? Are you going to take SDRs away from outbound outreach and prospecting to research and find leads...at scale?
- Have you considered the cost of hiring a researcher? It’s around $50,000 base salary plus the other costs mentioned above.
- Or will you be subscribing to lead databases and risk flooding your CRM with data-decayed contact info?
- We give you the costs for each of these options and the advantages and disadvantages for each.
Understand the Hidden Costs of Hiring, Ramping, and Managing
- 75% of high-growth companies hire sales reps with a year of experience or less - which means you are going to be investing a lot of time in training time to get them ramped up and ready to reach out to customers.
- But then consider this: the average SDR tenure is only 14.2 months - will you commit the time, money, and effort into a well-developed training program knowing the high likely-hood that you may have to start all over again next year?
- Get the guide for more on what it costs to not only hire an internal outbound sales team but also what it takes to scale.
Plus these additional insights:
- How to Value Sales Expertise
- How to Evaluate The Exponential Costs of Scaling Quickly and Easily
We hope you find value throughout the pages of the guide as you take the this important time to consider if outsourcing your outbound sales program is the right decision for your business. Remember, the level of outsourced commitment is totally up to you and what is right for your company and the team you have in place.
35% of the companies that work with us typically use a combination of an in-house sales and/or marketing team with our outsourced services.
SMBs come in all different shapes and sizes and are at very different points in their growth. But there is one universal truth for every B2B company: more meetings = more sales. How you get those meetings – and keep profit margins high at the same time – is up to you.
Based on our experience working with hundreds of SMBs across the country, 65% just aren’t at the size or run-rate to allow for the economic investment required to establish a successful in-house sales development team. Hence the reason they are coming to us as their outsourced sales development partner.
