In the medical/pharmaceutical industry, companies are typically represented by one of two different types of salespeople. In-house sales teams who work as part of each corporation they serve and outsourced sales teams who are brought in by contract sales organizations (CSOs).
Both types of sales teams are expected to do largely the same thing: Convince prospects to purchase the goods and services of the companies they represent. However, what’s the difference between outsourced sales teams and in-house sales teams? Which is the best for your company’s needs?
Let’s take a look at the benefits of sales outsourcing vs using in-house teams.
What Is Outsourced Sales?
Sales outsourcing is the practice of using external teams of sales representatives to sell products and services on the behalf of the client company. The specifics of how outsourced sales teams operate can vary from one CSO to the next. One type of distinction could be whether the outsourced team is “Full-Time” or “Part-Time.”
- Full-Time Teams. These teams offer long-term dedicated service—typically on a set schedule (such as 8-5, Monday through Friday). These reps usually have more open availability compared to part-time reps and are (usually) on the CSO’s payroll and have full employee benefits.
- Part-Time Teams. These teams consist of part-time 1099 contractors. They often don’t work a set schedule or, when they do, their schedule is limited (such as only working half the week). In some cases, they work to a set quota instead of a schedule and are paid on a commission basis or by the number of specific sales actions they take.
Axxelus offers both part-time and full-time outsourced sales teams. In both of these cases, they act as a part of the client organization—wearing the client’s uniform/badge, handing out the client’s business collateral, and building relationships on their behalf.
The degree to which this “white label” treatment exists may vary from one sales outsourcing service to the next.
Top Benefits of Outsourced Sales Teams
So, what are some of the top reasons companies in the med/pharma industry choose to use sales outsourcing companies rather than hiring internally? Some of the key benefits include:
- Cost Savings. Hiring a CSO to handle the task of finding and onboarding sales talent is often much less costly than managing the task internally—largely because you can skip recruitment costs like advertising for the position, using management labor to interview dozens (or hundreds) of applicants, and more. Additionally, when outsourced sales team members are on the CSO’s payroll, you can replace the overhead for pay and benefits with a set retainer fee.
- Time Savings for Recruitment. Going through the process of advertising for a given sales role, checking applicant qualifications, and conducting interviews can take months. With a reliable CSO, medical and pharmaceutical companies can cut recruitment timetables from months down to weeks or even days. This helps get sales positions filled faster so the company can focus on meeting its sales goals. It also helps alleviate the burden on sales managers by letting them spend more time managing their teams as opposed to interviewing job applicants.
- Getting Access to Pre-Vetted Talent. While it isn’t guaranteed that every CSO will do this properly, one of the bigger benefits of using a CSO is that they will pre-screen the sales talent they send to their clients. On top of that, they often have a large pool of talent to draw on. This makes it much easier to find qualified talent quickly that can “hit the ground running” to generate results.
- Saving Time and Effort on Training. In medical and pharmaceutical sales, ongoing training is critical for keeping up with regulatory requirements and the latest sales strategies. With some CSOs, companies can save time and effort on training because the CSO will handle the training for outsourced sales reps. This helps to reduce periodic training costs while also reducing the burden on sales managers. Considering that “70% of employees report that they don’t have mastery of the skills needed to do their jobs” (Source: Shift Learning), training is vital for ensuring employee effectiveness.
These benefits may explain why, as reported by Statista, “temporary and contract staffing sales reached approximately 136.8 billion U.S. dollars” in 2019. One harder-to-quantify benefit of using a CSO is that doing so can help mitigate certain risks.
Top Benefits of In-House Sales Teams
With all of the benefits of outsourcing sales, why would a company want to use an in-house team? There are actually a few key benefits for using in-house sales staff instead of outsourcing sales to a CSO, such as:
- Increased Control of the Sales Team. With an in-house sales staff, the company has the final say in all staffing decisions. This gives them greater control over their sales team, which can be useful for ensuring that everyone on the boat is rowing in the same direction.
- You Know the Sales Reps ONLY Work for You. When using part-time sales reps, there is the concern that they aren’t working only for one company. By hiring internally, companies can ensure that they are able to hold sales reps to no-compete clauses, minimizing the worry that the rep may prioritize another business’ needs. However, full-time contract sales reps are often able to provide this same reassurance.
- You Can Promote from Within. One of the key incentives that companies can use to encourage employee engagement is to offer advancement opportunities within the company. For example, allowing high-performing or exceptionally organized sales reps to apply for and earn sales manager positions or even transfer to other departments they may be interested in (such as taking up a marketing role). With in-house sales reps who are on the company’s payroll, this is easy to do. Outsourcing sales makes this process a little more complicated since sales reps are on the CSO’s payroll and aren’t technically part of the organization.
How to Choose Which Type of Team Is Best for Your Business
So, which type of team is the best for your business? There are arguments to be made for both sides. When choosing between outsourced sales and handling everything in-house, consider the following:
Do I Need Sales Talent Right Now?
If so, you may want to use an experienced CSO to fill spots on your sales team quickly. On the other hand, if there is no immediate need for talent, you can take your time to go through a slower recruitment process.
Do I Have the Bandwidth for Sales Team Training, Onboarding, and Recruitment?
If you aren’t exceptionally busy and have the free time to assemble recruitment campaigns, handle interviews, and then onboard/train new sales reps, then handling things internally could work just fine. However, if you’re busy and have a full schedule already, you might want to leverage a CSO to save some time and trouble.
How Much Success Have I Experienced with Internal Hires?
Finding and hiring the right medical or pharmaceutical salesperson is an art as much as it is a science. Hiring the wrong sales rep can lead to low performance, increased turnover, and even impact sales team morale. The problem is that there are about a million blogs on the internet that help job seekers get through interviews—so interviews aren’t always the best indicator of how the sales rep will perform once hired.
If you have experienced great success with previous hires, then it would make sense to keep hiring internally. However, if you have a lot of recent hires who struggled to perform or quit soon after taking the job, it may be time to seek help from a CSO.
Leverage the Benefits of Outsourced Sales with Axxelus!
At Axxelus, we take our customers’ success very seriously. We thoroughly vet every sales rep before presenting them to our clients—checking that they’re a good fit based on both skills and how well they’ll mesh with the client’s corporate culture. In fact, we’re so confident in the quality of our sales rep vetting process, we stand by it with a hire-right guarantee!
Why wait? Reach out to Axxelus to transform your medical/pharmaceutical sales today!
