So, your business is finally growing and gaining traction. It’s time to expand and widen your customer reach.
You read up to learn how to do this, and you encounter two vague terms: inside sales and outside sales.
If these terms are unfamiliar to you, there’s no need to worry. We’ll explain them in this article, and we’ll also go over some of the pros and cons.
In essence, inside sales and outside sales are sales structures that define how a business interacts with its customers. There is no right or wrong structure to use: you will have to consider your location, your budget, and the nature of your business.
Some companies rely exclusively on either inside or outside sales, and some use a mixture of both.
If you want to know which one is better for your company, you’ll have to know the details. Let’s take a closer look.
Outside sales involve going out and talking to a customer in person
When we picture sales agents, the traditional picture that comes to mind involves outside sales.
A sales agent walks over to a potential customer, attempting to convince them to buy or subscribe to a product. There may or may not be a product demonstration. After a few conversations back and forth, the interaction ends with or without a new customer for the business.
It’s called “outside” because the sales agent literally leaves the office and goes out “into the field.”
It’s expensive, it’s slow, and it’s tiring for the agents. But there is a proper time and place for them, and some might say that they’re more likely to end up with a high number of closed deals. We’ll talk more about that in a bit.
Inside sales involve remote interactions with the customer
True to its name, the term “inside sales” means the sales rep stays inside the company. There’s no need to actually go out of the office.
Inside sales agents use remote communication technology to find customers, talk to them, and eventually close a deal. With the rise of programs like Zoom, Skype, and Google Meet, it is now easier more than ever to fully communicate with others without ever leaving the office.
You’ll find this sales structure more dominant in B2B, SaaS, and technology-related businesses. The parties involved seldom have the free time to move out of their offices for sales talks, so it is more convenient for everyone to talk remotely.
Inside sales and outside sales require different skill sets
If your team is composed of people who are good at selling in person, you have to recognize that their skills are not instantly convertible to inside sales.
Different skills are required for different kinds of sales, so you should also consider your team’s capacity when you are about to expand your business.
This should also factor in when you start hiring sales agents to help with your expansion.
Inside sales are more cost-efficient, have faster response times, and are easier to scale
When you think about it, there’s really not much cost involved for inside sales. You don’t have to pay for your reps’ transportation, and no time is wasted traveling from place to place.
The less time your reps have to travel, the more time they can use to sell. In fact, inside sales reps spend 13% more time selling compared to outside sales reps.
Additionally, inside sales reps can respond faster to leads and customers. It’s much easier to address an inquiry in five minutes when you can read the lead’s message and craft a response online.
On the other hand, an outside sales rep would have to prepare and travel before they even get started responding to leads.
It’s also easier to expand an inside sales team. You don’t have to worry about relocating your reps to a different location, which would require you to consider their willingness and expertise in the area.
With inside sales, it’s much easier to train your new reps whenever you need to expand.
Another thing to consider is that inside sales reps have better teamwork and collaboration. Since they are primarily working in the same place, it’s easier for them to help one another solve problems that can arise in the various stages of the buyer’s journey.
Outside sales can foster more trust from clients and have a higher close rate
Of course, when communicating with a client in person, it’s much easier to adjust the interaction based on unspoken communication signs like body language and verbal tics.
This makes it easier for your sales reps to adjust on the fly, leading to a higher close rate. In fact, studies show that outside sales reps have 40% more closes than inside sales reps.
The benefits of clearer, in-person communication does not benefit only your sales reps. Since the customers can also see your reps’ nonverbal communication, they’re more likely to trust your rep and, by extension, your business.
Of course, the fact that outside sales reps have a higher close rate does not necessarily mean that outside sales are objectively superior to inside sales.
Considering the cost of outside sales, it might ultimately be better for you to stick to inside sales when your customer base is a little smaller. Once you start gaining momentum on your expansion, then maybe you can start looking into expanding your outside sales too.
Your organizational needs will ultimately determine the best sales structure
Again, there is no such thing as an objectively superior sales structure. You can’t just look at the statistics and conclude that outside sales are better just because they have a higher close ratio.
Outside sales are expensive and slow. But they might work better, especially when your product involves things that require an actual, in-person demonstration.
On the other hand, the cheapness and efficiency of inside sales do not mean that they are the best solution. There are also plenty of barriers to remote communication. Even though remote communication is quickly becoming a norm, you can’t expect everyone to be comfortable with technology, especially when buying products.
So, know your business and know your customers. From there, you can choose exactly how to expand your business, and with the help of our small guide, we hope you can make the best choice in choosing between inside sales and outside sales.