The Cost of Inside Sales
The Cost of Outsourced Telemarketing
What’s the Return?
Inside Sales Revenues
Outsourced Telemarketing Revenues
People may think that the most important factors to calculate into the cost of inside sales would be salaries, phone costs, and system costs.
There is, however, more to consider. Inside sales people tend to have high turnover rates and, therefore, you need to factor in recruitment and training costs. In addition, you will need to hire a manager to oversee the agents’ work. You can assume that one manager to 10 agents would be an ideal ratio. Finally, you will need to dedicate space to the telemarketing activity which will need to be heated, cooled, cleaned and maintained.
The chart below shows the costs associated with an inside sales department.
Outsourced telemarketing comes for a flat fee of $6,250, very similar to the costs of inside sales.
Of course, you’re not just concerned about costs. To make a decision, you need to understand the return sales generated by each option.
At this level of investment, the inside sales option generates approximately 950 calls a month that yield about eight sales appointments and 0.8 deals close. The average sales value is $87,000 and, thus, the monthly revenues of inside sales are $69,600, yielding an impressive return on investment (ROI) of 946%.
Outsourced telemarketing, however, usually proves to be even more beneficial than inside sales for several reasons. Professional telemarketing agencies have years of experience selling to the discriminating B2B buyer. Also, because they have many clients, they can leverage best practices. Finally, they know how to hire the best agents, train them well and reassign them into different roles as necessary to avoid burnout.
Because of these factors, outsourced telemarketing completes more calls per month (1,425) and arranges ten sales appointments. Since they are experts at lead qualification, sales people increase their conversion rate to 10%.
Thus, this option, with slightly lower costs than inside sales and the ability to set more and higher quality appointments, is the clear winner with a ROI of 1292%.
Given the numbers, it seems like most B2B companies should choose the straightforward path of outsourcing their telemarketing rather than trying to reinvent the wheel and create an inside sales team from scratch.
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