Inside Sales vs Outside Sales: Which Is Better For My Business?

Choosing between inside and outside sales for your sales strategy is one of the most important decisions sales professionals must make. And with evolving technology and marketplaces, it's harder than ever to determine the best course of action.

If you're reading this, you're probably already weighing up costs, KPI metrics, and deal-size statistics to figure out which sales strategy is best for your business.

Well, just like inside and outside sales, it's a team effort. That's why we've compiled the ultimate guide to inside sales vs outside sales, covering everything you need to know about each so you can makes an informed decision.

So if you're struggling with inside sales vs outside sales, read on; we're here to clear things up.

Understanding inside sales

Making up almost half of the sales representatives in the U.S., inside sales reps are tasked with selling products or services remotely - that means closing deals through phone calls, over email, via social media (social selling), and other channels.

An inside sales system lends itself particularly well to business to business (B2B) SaaS and tech companies, where in person meetings aren't necessarily crucial for making a sale. However, inside sales strategies aren't without their drawbacks.

What do inside sales teams do?

Inside sales reps are generally based - you guessed it - inside. This means they're usually either office-based, remote, or hybrid, using their sales skills to generate new leads and guide prospects through the sales pipeline. In practice, this means making a lot of sales calls and sending a lot of messages.

But that doesn't mean they don't need the same set of soft skills as an outside sales rep. They still need:

• Exceptional knowledge of the product or service
• A deep understanding of customer needs
• Comprehensive negotiation skills
• The ability to remotely guide potential customers through the sales process

The benefits of using inside sales professionals

It's no secret that smaller companies with revenues under $50 million generally favor inside sales reps. And when you take a look at the benefits below, it's no wonder why.

1. It's cost-effective
   Not only is the average salary of an inside sales rep significantly lower than that of their outside sales rep counterparts ($56,000 compared to $103,905, respectively), but their operational costs are lower too.
   
   For a start, once an inside sales representative is trained and provided with the necessary tools (computer, phone, software etc.), the day-to-day costs remain relatively stable. A single call made by an inside sales team, for instance, costs around $50, whereas an outside sales call can cost around $308.
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2. Better use of technology
   As inside sales reps are office-based and complete most of their work on-screen, they have the opportunity to harness powerful enterprise technology more easily. Customer Relationship Management (CRM), for instance, becomes a matter of just a few clicks. Likewise, sales goals and sales operations can be more easily monitored, allowing for adaptability.
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3. It's more efficient
   Simply put: an inside sales agent can usually make more deals than an outside sales rep by virtue of the fact they don't need to spend time travelling. An average inside sales rep makes around 33 phone calls a day - an outside sales rep couldn't hope to have that many face to face meetings.
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4. It's scalable
   Considering the factors mentioned (the lower costs, the higher efficiency, the better tech), not to mention the faster onboarding and greater flexibility, it's clear that an inside sales model is vastly more scalable.

Inside sales drawbacks

We're not here just to sing the praises of inside sales models; we're here to compare inside sales vs outside sales. To that end, it's only fair we take a look at some of the downsides of using inside sales as a primary sales strategy.

1. Lack of face to face interactions
   Inside sales reps are stuck behind a screen, and we all know what that means when it comes to outreach: potential customers are more likely to be wary and less likely to pursue. This isn't just a hunch, either - evidence suggest that face to face meetings are 34 times more successful than remote (i.e. email) requests. In short, it can be harder to establish a strong brand presence and build trust when relying solely on inside sales representatives.
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2. Not as good for building relationships
   In person meetings will always have the upper hand when it comes to building relationships with existing customers or new prospects. In fact, an overwhelming 95% of marketers agree with this, saying that face to face interactions are 'essential' for sales organizations looking to maintain relationships.

Understanding outside sales

As you might imagine, and outside sales teams aren't bound to offices and computers. Their main job is to travel to customers directly and arrange sales meetings in-person.

Despite all the benefits of inside sales, big, high-revenue companies still love outside sales. In fact, outside sales reps make up over half of the sales force of companies with revenues over $500 million, according to Xant.

What do outside sales teams do?

Outside sales reps (or 'field sales reps,' as they're sometimes called) spend most of their time on the road. Whereas inside sales reps are shooting off messages and phone calls from an office, outside sales professionals are traveling to trade shows, industry events, and places of business to meet with key decision makers and persuade them to either buy or arrange a further meeting.

The benefits of outside sales models

1. Relationship building with a personal touch
   An outside sales team has a greater ability to establish personal relationships with potential customers from the outset. Generally, prospects trust outside sales reps more than they do inside sales reps. That's why the average closing rate for outside sales reps is a huge 40%.
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2. Larger deals
   Whereas inside sales reps may make more smaller deals, outside sales teams have the ability to close deals of higher value. In fact, the average yearly quota for an outside sales representative is $2.7 million!
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3. Hands-on demonstrations
   Outside sales reps at trade shows or industry events have a unique opportunity to demonstrate your product or service in front of an attentive audience. This can have a huge impact on the credibility of your offer.

Outside sales drawbacks

Of course, where there's a pro, there's a con. It's important to understand the full implications of hiring an outside sales team for your sales model.

1. It's more expensive
   As we covered earlier, an outside sales salary is, on average, over $100,000 (compared to $56,000 for an inside sales rep). But that's not all: an outside sales team will incur many other significant costs, too. Take, for instance, travel and accommodation expenses, event passes, and training.
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2. It takes more time
   From training to actual sales operations, outside sales are simply more time-consuming. And although time spent travelling and meeting can pay off in big deals, it can just as easily end in a 'no.'
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3. Limited scalability
   Once you've invested in an outside sales team, your sales performance is largely in their hands. The sheer cost and time involved in replicating their success and scaling up is simply too much for many companies to contemplate. That's why 68% of sales leaders are switching to hybrid or fully-remote sales models right now.

Comparing inside and outside sales

Ultimately, when weighing up inside sales vs outside sales, you need to consider what's best for your business. Size and revenue will play the most important role in determining your direction: if you're looking for lower costs, inside sales is a safer option for its faster training, lower salaries, and easy scalability. Hiring outside sales reps, however, may be an attractive choice for larger companies who want to exploit that personal touch and shoot for a smaller number of larger deals.

It's important to remember, too, that great sales models feature both inside and outside sales. A hybrid model allows you to continue reaping the rewards of an inside sales team while experimenting with outside sales. Then, you can analyse your individual metrics to make a more informed decision.

But when it comes to generating high-quality leads and developing your sales teams and sales strategy, there's no better way than to look into external B2B lead generation and sales development services like Leadium. For experienced, expert advice on inside sales vs outside sales, why not see what Leadium can do for you today?

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