How beneficial is outsourcing inside sales?

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I often find myself into a sales situation trying to answer this question directly or indirectly. Also, people want to know if outsourcing inside sales or lead generation really works. There is no one-size-fits-all answer and it depends on the specific situation. For example, outsourcing business functions like software development, customer service, legal services etc work for certain companies and others decide to keep it in house.  I remember once reading about a Church outsourcing prayer services. I mean seriously!

I think the question in itself is very generic and open ended. The right question to ask should be, how beneficial is it to outsource “Inside Sales services” in your specific situation?

A friend of mine is VP of sales at a technology company that has 200 customers globally. They sell complex project execution management software to aviation, petrochemical, military and steel industries.  This is a software company and has already outsourced most of their software development. So they clearly understand the benefits of outsourcing. However they will not outsource their ten people “Inside Sales” team. Why? Because each sale is very complex and has a very long sales cycle besides the high dollar value associated with the deal. The company obviously needs highly trained engineers for inside sales.

Not every situation is like that.  In most situations “Inside Sales” tasks include straightforward cold calling, profiling, list development, identifying decision makers, research, appending and cleansing data, and appointments setting etc. A good outsourced “Inside Sales” company is generally very adept at these.  If your sales are a volume game, the products and service are not very technical, your target market is not very brand conscious, and your sales cycle is not very long, it may be a good idea to consider some of the following benefits of outsourcing “Inside Sales”.

1. Scale faster: Up or down. Spare yourself from the pain of hiring internal employee, posting job advertisements, screening resumes, interviewing, induction and training.  You can tell the outsourced “Inside Sales” or “lead generation” company to add the desired number of resources from as soon as next week onwards or even reduce the head count depending on your contract with them.

2. Focus on your core competencies: “Inside Sales” is a very involved affair. Someone has to constantly monitor and measure the resources, generate new ideas to create the pipeline, execute the lead generation campaigns. Focus on doing what you do best rather than counting the number of calls, contacts per hour, conversation rate, voice mails and where to get the list from for your new outbound campaign.

3. On demand capacity: Even if you have an in house “Inside Sales “team, it is a good idea to have an outsourced “Inside Sales” company on your speed dial. Here is an example of the requests I have received from some of our customers

   • One of our inside sales rep has resigned and we cannot afford to miss this quarter numbers. We need one resource for three months for telemarketing

   • We are doing an expensive direct mail campaign and some one just discovered that our database does not have correct location addresses. We need some one to clean and append the data on immediate basis. Can you put three people on the job starting tomorrow?

4. Reduce Overhead: Think of management, HR, administrative and infrastructure overhead you would be saving.

5. Cost benefits: This one is a little tricky. Not all outsourcing companies may help you reduce direct costs at least in the short run. In case your goal is to accomplish significant cost saving, try offshore “Inside Sales” companies instead. You can easily achieve about 50% cost saving or have two resources in the same budget.