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The Three Things You Need to Know to Build a Sales Team

Updated: May 22, 2022

If you are a small business owner, at some point you’ve had to sell your product or service to a customer. As your company has grown, you are now at an inflection point where you need a dedicated sales team. It’s a big investment, but you know it’s the right thing to do. The challenge is how to structure it, and how to ensure it is successful. In my career I’ve been given the opportunity to sell technology products using different strategies and have experienced the good and the bad. Here are the three key things you need to know. OK, there's more than three. But if you can nail these three you've created a solid foundation.

1) Invest in a CRM System – Customer relationship management software, or CRM, has a long history dating back to the 1990’s. CRM helps organize leads, customer information, account details, and sales opportunities in one centralized database, making it easier to manage your data. It also helps improve work productivity by allowing access to information by various groups across your company. Generally, CRM is cloud-based and is a critical cornerstone for a high performing sales organization. Do not, I repeat, do not kick the can down the road and try to manage your sales activities via email, spreadsheets, and other collaboration tools. I’ve seen small and large companies try to do this, and not only is it inefficient and a case of penny-wise and pound-foolish, but it is also asking for trouble down the road when someone from your sales team decides to leave and none of your sales opportunities are preserved for handoff internally. There are several CRM solutions available, but my recommendation is to stop your search and purchase a subscription to Salesforce. Make this your first commitment to an effective sales team strategy.

2) Select The Right Sales Channel – Different products are best sold with the right sales channel in mind. For example, trying to sell a house online without any human interaction is impossible. Likewise, would selling a $9.95 pillow direct to consumers with a nationwide sales organization be a smart idea? Of course not since selling online would a much better strategy. So what are the options you need to consider for business-to-business sales?

First is direct sales. It is all about your salesperson identifying someone with an interest (hopefully that lead comes from Marketing, more on that in another blog), understanding the situation that the prospect finds themselves in, the problem they have, the implication of that problem, and the need they have to solve that problem (hopefully yours!). Direct sales is most appropriate for a technical product where the salesperson needs to have an in-depth knowledge of the product and the application. I like to say that direct sales is a full-contact sport, and it demands a lot of effective communication.

The second approach is distribution sales. Typically best for lower priced, non-technical products, you negotiate an agreement with a distribution company to stock inventory of your product and re-sell it using their sales team. In exchange you sell the product to the distributor at a discount, and they ultimately determine or negotiate the sales price to the end user. But don’t think you are out of the sales business! These distributors need to be managed, in particular your sales team (smaller because of this distribution strategy) needs to train the distributor sales reps on the features and benefits of your product and why they should be selling it. You need to understand that distributors are selling a LOT of products and some of them might be competing products. This dynamic from your salesperson to the distributor sales rep is best described as educate, motivate, and communicate. How your team does that is in some ways more complex than direct sales.

The third approach is manufactures rep sales. In some ways this can be a hybrid of the first two sales channels, and even then it can be customized to the preference of either party. A manufacturers rep is an independent sales company with a given geographic territory that agrees to sell your product with some level of support from you, the manufacturer. They typically do not stock product but represent and promote the product sales of a select number of manufacturers who are usually synergistic and non-competitive. In exchange for a sale, the rep receives a commission from the manufacturer; for a technical product this can be about 15% but it varies widely. By receiving a commission on sales, manufacturers reps are typically highly motivated; if they don’t sell anything, they don’t make any money. If you think this sales channel is for you, I highly recommend you attend a training seminar conducted by the national manufacturers rep association so that you have a complete understanding of the roles and responsibilities of each party.

3) Commit to Hiring the Right Salesperson – News flash: not everyone is meant to be in sales. It’s a super important role and simply sticking anyone in the job you can hire and expecting great results is asking for trouble. It’s a reasonable strategy to hire someone with experience, particularly if it’s in your market. But what are the essential traits that make for a great salesperson? I’d submit that they better have a solid personality. Sales is not for introverts, but neither is it for abrasive loudmouths. Interestingly I’ve heard customers boil it down to one question: “Would I buy from that person?”. That salesperson also needs to be resilient to the big ups and downs they’ll experience in sales. Closing that really big opportunity, well that’s a high that all good salespeople enjoy. But lose a sale because of a trivial difference in price, or a built-in bias from the customer, that makes for a really bad day. And lastly your salesperson needs to be relentless. A study conducted by Harvard years ago determined that, on average, it requires a salesperson to follow up 6.2 times with a prospect before they are ready to buy. You cannot be a pest, but you need to stay in touch with that prospect or else your competition will secure the purchase order simply because you were not top-of-mind with the prospect. And how do you set up a process to continually follow up with prospects? A CRM system!!

The complexities of sales certainly extends beyond these three elements, and I’d expect spirited debate from seasoned sales professionals about other must-have criteria. But I genuinely believe if you start with these three building blocks, you’ll be taking the right first steps. And I’d encourage you to speak with other business owners about their experience with sales teams and seek out the other factors they’ve learned about building and managing their sales team.


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