The practice of outsourcing sales development has been growing rapidly in recent years. The global outsourced sales service market was valued at $3.96 billion in 2022 and is projected to expand at a compound annual growth rate of 8.67% through 2030. More and more SaaS companies are choosing to outsource some or all of their sales development activities in order to fuel growth.
Why build an outsourced sales development team?
Outsourced sales development is a model where a company partners with a specialized service provider to handle lead generation activities. Rather than hiring an in-house sales development team, the SaaS company leverages the expertise and resources of an external partner. Outsourced sales services include prospecting, lead qualification, appointment setting, and sales enablement.
There are several key reasons why outsourcing sales development has become increasingly popular among SaaS businesses:
- Access to proven sales talent and expertise
- Faster revenue growth and improved sales efficiency
- Lower costs compared to hiring in-house staff
- Flexibility to scale up or down quickly
- Ability to tap new geographical markets more easily
With the promise of accelerated growth and streamlined sales processes, it’s no surprise that more and more SaaS companies are exploring outsourced sales as a strategic lever for expansion.
What do Outsourced Sales Development teams do?
Typically, an outsourced sales development firm will provide services such as:
- Lead generation – Identifying and qualifying new sales leads
- Prospecting – Reaching out to potential customers via cold calls, emails, etc.
- Appointment setting – Scheduling sales meetings and demos for AE’s
- Sales messaging – Crafting compelling outbound sales messaging
- Data entry – Entering lead information into CRM and marketing systems
Benefits of Outsourcing Sales Development
Outsourcing sales development provides several key benefits for SaaS companies looking to accelerate growth:
- Faster time to revenue and sales growth – An experienced outsourced SDR team can quickly ramp up qualified prospecting, enabling faster pipeline growth and sales. This allows SaaS companies to scale customer acquisition faster.
- Access to sales expertise and best practices – Outsourced sales partners specialize in the SDR function, bringing expertise in sales processes, technologies, and approaches tailored to SaaS models.
- Increased efficiency and lower costs – Rather than hiring, training, and managing an in-house SDR team, outsourcing provides immediate access to an efficient sales development machine. It converts fixed costs into variable, performance-based costs.
- Focus in-house teams on core strengths – Handing prospecting activities to specialists allows in-house sales teams to focus on complex, value-added functions like closing deals and account management.
With these benefits, it’s clear why many growing SaaS companies strategically leverage outsourced SDR teams to cost-effectively drive more pipeline and revenue.
Choosing the Right Sales Outsourcing Partner
Selecting the right outsourced sales development partner is crucial for realizing the benefits while mitigating the risks. Here are some tips on finding a provider with the right capabilities, expertise, and culture fit:
Important capabilities to look for include sales methodology, tools, and systems for prospecting, conversation intelligence software, and experience selling into your industry vertical and ideal customer profile. Ask potential partners about the sales approaches they use and look for data-driven methods focused on outbound success versus high activity.
Make sure to ask specific questions about their sales team’s experience level, any specialized training programs, and examples of successful sales campaigns they have executed for clients. Having the right expertise for your product, industry, and customer needs is crucial.
Lastly, evaluate culture fit. Make sure values and work styles align well. Frequent communication and transparency will be vital, so ensure your expectations match in terms of responsiveness and collaboration.
Keys to Making Outsourced Sales Development Work
Outsourcing sales development can provide strategic benefits, but only with careful management and an aligned partnership. Here are some keys to success when outsourcing sales development:
- Set clear goals and metrics. Have quantifiable targets for outreach volume, response rate, meetings booked, and pipeline generated. Track progress regularly.
- Maintain visibility into sales activity. Use a CRM to stay updated on prospect interactions and get daily/weekly recaps of progress.
- Implement regular training and feedback loops. Make sure your outsourced team receives ongoing coaching, and share insights into what messaging works. Gather feedback to improve processes.
- Integrate the outsourced team with internal teams. Facilitate regular contact between sales development reps, account executives, and marketing.
- Have a proactive and hands-on partnership. Don’t just set it and forget it. Frequently communicate, monitor results, and make adjustments.
With aligned goals, seamless integration, hands-on management, and consistent communication, an outsourced sales development team can become a valuable extension of your sales organization.
When Does Outsourcing Sales Development Make Sense?
Outsourcing sales development can be a strategic move for SaaS companies in certain situations, including:
- Early stage startups: young companies may not yet have the resources or sales expertise to build an in-house team. Outsourcing gives them immediate sales capabilities.
- Expanding to new markets: entering a new market often requires specialized local knowledge. Partnering with outsourced sales reps based in that area can help bridge the gap.
- Seasonal or cyclical sales: outsourcing can provide flexibility to scale sales development teams up or down to match peaks and valleys in sales cycles.
- Lack of internal expertise: companies may not have the in-house sales skills needed to ramp up sales, making outsourcing a fast way to tap into sales talent and expertise.
In these situations, outsourcing can provide a strategic boost in sales capabilities without the need to build large in-house teams. The key is determining if outsourcing makes sense for your specific business conditions and objectives.
Outsourcing sales development can provide strategic benefits for SaaS companies, but it requires careful management and oversight. The key is finding the right partner that aligns with your business goals, understands your target market, and meshes well with your internal team. With the right partner and approach, outsourcing sales development enables faster revenue growth, lower costs, and expanded capabilities.
Before deciding to outsource, SaaS companies should carefully weigh the pros and cons based on their specific situation and objectives. The process requires involvement and management from company leadership to ensure success. Outsourcing works best when viewed as a collaborative partnership between equals, not just a vendor relationship. With reasonable expectations and the appropriate effort to make it work, an outsourced sales development team can provide a strategic boost for SaaS businesses looking to accelerate growth.
Outsourcing sales development can provide significant benefits such as faster revenue growth, sales expertise, and flexibility. However, there are also risks like loss of control and communication challenges.
To make outsourcing work, partner with a proven provider that aligns with your goals and culture. Define clear metrics and processes while maintaining visibility. Provide extensive training and feedback.
Outsourcing is best for early-stage startups, expansion into new markets, fluctuating sales cycles, and when internal sales expertise is lacking.
With the right approach, outsourcing can provide strategic support and enable SaaS companies to scale sales faster. However, the partnership requires careful management.