Sales force outsourcing is not a newly discovered concept. It has been a common exercise of both small and large businesses. Sales agents, distributors and resellers are the most typical set ups in sales force outsourcing.
This industry however has been threatened with the rapid rise of BPO (Business Process Outsourcing) forcing Sales Force Outsourcing to be strategic alternative to indirect channels and sales agents.
Two Models Of Sales Force Outsourcing
There are two models of sales force outsourcing: sales agents & distributors / resellers and BPO solution of Sales Force Outsourcing.
A sales agent is someone who is self-employed and is the person who sells products in behalf of a company. Most often than not, the terms of payment is on commission basis though there are instances wherein a sales agent has basic salary. When delving into retail or manufacturing, sales representative generatlly carry numerous items and have established contacts. One may believe that sales force outsourcing is an excellent alternative available. Yes it is a viable solution but this too has its own limitations.
The specialization of sales agents is based on a defined market that depends on the geography or the industry of a particular sector. They will only go for products that are sellable to their available contacts. This means that if you outsource your product to an existing market that has no interest for it, sales force outsourcing is not a good solution.
If you employ sales force outsourcing, you will require a number of sales agents that will need dedicated management resources to optimize your outsourced sales force.
Distributors / Resellers
Another option that may prove to be a good a solution for sales force outsourcing is through an indirect channel network. The important aspect when talking about distributors and sellers is that they own customer thus living to up to the name oblique sales channel. This aspect is also the difference between sales agents and distributors / resellers.
While a sales agent sells products for you or your company, distributors / sellers on the other hand purchase your products and sell them to their customers. With this, you drop control over the end customer as well as being capable of selling other services and products directly.
Just as the same with sales agent, it is limited to a point wherein you can only sell to those who have customers that are interested with your products. Otherwise, sales force outsourcing through distributors / resellers will be a lost cost. That is why you need to choose carefully whom you partner up with – always research, research and research.
Sales Force Outsourcing Organizations
In the past, companies build an in-house direct sales force. The process in doing so entails a big investment of funds as well as expertise. Hiring, training and managing this kind of set up will put wholes in the pockets of companies.
But if this kind of setup is an extravagant, why do organizations opt for this? The answer: control. When sales agents or distributors / resellers vend out your products or services, you have little to no control on what they do or how they sell your product.
Having an in-house sales force, a company will be able to have control over its markets, prices as well as choice of customers. This setup can be a competitive edge over other companies in the same industry.
As of today however, the business process outsourcing (BPO) sector is on the rise and because of this sales force outsourcing is becoming an alternative to having an in-house sales force. Unlike with utilizing sales agents and distributors / resellers, you still have control over the target markets, sales activity, and pricing