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Benefits of OutsourcingMost outsourcing decisions begin with cost-cutting – but rarely end there. Once the efficiencies of outsourcing are in place, companies find ways to use them for a broad range of improvements to processes and performance. Reduced Direct Costs As mentioned above, the economies of scale experienced by
outsourced
Sales and Marketing providers allow them to offer equivalent services
at lower direct costs than in-house approaches. What’s more, outsourcing
partners are free to use creative cost-cutting approaches unavailable
to companies like yours: locating in more favorable employment markets,
assembling full-time coverage from part-time or seasonal employees, and
so on. Reduced Indirect Costs The costs of in-house Sales and Marketing support are often Relieved of the need to manage day-to-day administration and support, they are free to focus on generating revenue – the reason you hired them. Reduced Opportunity Costs Focused outsourced programs improve sales coverage. More leads are qualified, geographic regions or channels are covered in greater depth, and more sales can be wrung from secondary sources. In these and other cases, sales are recovered from previously overlooked sources, improving sales performance at low marginal cost. Fixed Costs Become Variable In fast-changing markets or companies, outsourced solutions’ variable pricing helps during expansion or contraction. Outsourced programs grow to meet opportunities or mergers, or shrink when the market turns down. And if they outlive their usefulness, they are much easier to cancel. Business Process Improvements Quantifying current performance – necessary for any outsourcing program - reveals gaps in measurement, and points the way to simple but powerful remedies. If you don’t already measure lead qualifications, partner turnover, or cost of sales by market and channel, putting metrics in place will improve performance. Focus and Expertise Sales and Marketing outsourced specialists live in the market– knowing their surroundings is a matter of business survival. Agility Outsourced specialists design their technologies and processes to scale up quickly, so they can always say “yes” to new business. Their clients benefit from all this reserve capacity In case of acquisition or change of direction, a manufacturer can scale up or redeploy its efforts faster through a partner than it could operating alone. Their flexibility and agility also make outsourcing ideal for experimental and pilot programs. Service Quality and Customer Satisfaction Manufacturers are acutely sensitive to customer complaints about service providers, and service providers know it. They stay in business by outperforming comparable in-house programs, and putting measurements in place to prove it. The data available on service outsourcing – mostly from surveys – reveal a boom. Gartner, Inc. predicts business process outsourcing (which includes Sales and Marketing) will grow from $110 billion in 2002 to $173 billion in 2007 – an annual compounded rate of 9.5 percent. Sales Expertise Many companies are launched by engineers, or operations professionals. They are able to grow their business to a certain level, but in order to achieve their next level of growth, they need to look for outside sales & marketing expertise. Tactical Revenue Sales Outsourcing solutions, which range from advisory services to outsourcing services, focus on developing Tactical Revenue Plans that will help companies achieve the next level of growth quickly! Speed to Market Another factor is time to market. It is much quicker to have a well trained and managed Sales Team out the door making calls then for the company to be starting or rebuilding a group. What are other indicators or reasons that suggest your company may need to look at Sales Outsourcing. Outsourcing, often referred to as the most important management development of the decade, is based on the principal “if it isn't your company's core competency, then take the activity or business process and contract it out. It [outsourcing] is an indispensable tool for world-class companies, allowing them to improve their products and services, lower their costs, and enhance their flexibility.” The Outsourcing Institute surveyed its membership to determine the top reasons companies outsource. Top 10 Reasons Companies Outsource • Reduce and control operating costs |