“One of the most crucial decisions you make is how to sell your products or services.”
There Are Many Different Options for Your Sales Force
There are basically four alternatives for building a sales force:
- You can hire a larger company or a distributor to sell for you.
- You can hire independent manufacturers’ reps.
- You can hire your own outside salespeople.
- You can hire inside salespeople who respond to customer inquiries.
Which choice you make will have a huge impact on your ability to generate sales and, also, your cost structure. Often the best solution is to use a combination of the different sales models. For example, for Adams Media, my previous book publishing business, we used distributors abroad and in specialty markets; our own sales managers for the largest book and software accounts; manufacturers’ reps for mid-size accounts; and phone selling and email for the smallest accounts.
Use Someone Else’s Sales Force
Especially if you have a small product business, you’re probably going to be better off trying to get a larger company or a distributor to sell your goods. Even if you could get sales reps or manufacturers’ reps to sell your product, it may be difficult to persuade companies to open a new account for you, and getting paid may tax your patience.
You will need a distributor with an outside sales force who will call on customers and push your product—not a wholesaler who typically stocks a very broad group of manufacturers and more or less waits for customers to send in orders. The terms “wholesaler” and “distributor” are often confused, and it’s difficult to judge how aggressively a distributor will push your products, so get references.
Manufacturers’ Reps Build Businesses
Manufacturers’ reps played a crucial role in building my book business and a lot of other businesses. Independent sales reps sell products for a number of different firms. They are paid on commission, so you’re not stuck with a high overhead for salaries and travel when sales are low, and they already have an entree with the prospects to whom you need to sell. Some manufacturers’ reps are self-employed, and some work for sales rep firms that employ a number of salespeople. Generally, manufacturers’ reps sell a lot fewer product lines than a distributor does and will push each line harder.
It’s up to you not just to find reps but also to really sell them continually on how hot your products are. Meet with them in person, tell them sales success stories, send them media clippings, send them sales samples, and pay them promptly.
Developing an Outside Sales Force Is Difficult
I hired my first salesperson to sell advertising for a tiny map business I started while still in college. I told her to call in every day with a progress report. Three weeks later she called in for the first time and reported that nobody was interested. She had lost her call reports, and she needed her paycheck!
Believe me, it’s not easy starting up an outside sales force. It’s the most difficult and expensive sales solution by far, but the results can be great if it all clicks together. And often the most difficult outside person to manage and motivate is the first one! He or she has no other sales rep to talk to and compare notes with; plus, you probably don’t have a developed sales program or existing accounts to start with as a base and feel good about.
If you decide to hire outside salespeople, you’ll need to pay a base salary, not just commission, and keep really close tabs on them. For one, you want to make sure they’re really working. And two, even if they are highly experienced, you need to keep motivating them.
Although it is difficult and expensive to build your own successful outside sales force, the payoff can be gigantic. Your own dedicated outside sales force is often one of the most powerful tools to building a huge business. But it’s not an endeavor you should dive into until your business has built up solid momentum and the resources to support it.
Inside Sales Is Easier to Manage
Managing and motivating inside or phone salespeople is a lot easier than putting together an outside sales force. You can contact a lot more prospects for a lot less money, and you’ll save a lot by avoiding travel costs. Of course, some products are too big a decision and too complex to close without an in-person visit, but the majority of products and services can be closed over the phone. And increasingly, companies are comfortable buying products just by email or instant messaging.
For phone sales, hire people who are articulate. Test them by role-playing a sales scenario before you bring them on board. Pay them an hourly or a weekly base wage plus a bonus based on results. In addition, consider impromptu contests like “The next sale gets an extra $50 or a pair of movie tickets!” If you really need to close sales in person, you may want to have phone salespeople find and qualify leads, and then send a more experienced salesperson, or yourself, to close the sale.
Takeaways You Can Use
- The sales force decision is a big deal for your business.
- Don’t choose your sales method by default.
- Carefully examine what mix of sales force alternatives will work for you.
- Reevaluate and test different methods.