MBA1306 Does Your Business Need a Sales Team?

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And with a premium suite of monitors and accessories, you can upgrade your whole setup with amazing savings. Visit Dell.com deals. Hey O. Welcome to the Hundred Dollar MBA show, the podcast of choice for those entrepreneurs that want to get things done. That's why we deliver daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zenholm. I'm also the co founder of the Hundred Dollar mba, a complete business training and community online. And in today's episode you will learn. Do you need a sales team for your business? Whatever you sell, a product, a service, a course, a software. Do you need somebody or some people, a team of people to be in charge of selling this thing, Making sales calls, reaching out to potential clients, running webinars, whatever it is, do you need that manpower to generate sales for your business? It's an important question because hey, it's a cost, but if the cost justifies the return, then it's not such a bad idea. So we get into what kind of businesses need a sales team, what are some alternatives and how to get started if you do need one. All that and more in today's episode. So let's get into it. Let's get down to business. No matter what your business does, what it sells, how it sells it, there's one thing for sure you you need sales. You need people to buy your product or service. Without customers, you don't really Exist, right? You don't really have a business on your hands. Money's not coming in. You need a way to generate sales somehow. So in today's episode, we're gonna look at different business models and see which ones need. A salesforce needs people, actual talent to make these sales happen. What are some alternatives and what are some hybrids of these? Or how to get started with a salesforce with a sales team. Now, regardless if you want to admit it or not, generating sales costs money. It just costs you money in some way to make a sale. Whether you have a salesperson making phone calls and they're on a salary, whether you're running webinars, even if you say, hey, I have no salespeople, I just have like a free trial or free plan. That's a cost on your business. Using your product to grow your business is a sales exercise, right? It's a way to sell your product and it costs you money to provide that product for free. So any way you slice it, you are going to pay a price to generate sales. Now the question is how best to spend those dollars, how best to spend that money to make sales? Where can you get the best bang for your buck, the best return on your investment to get as many sales as possible for your business. In business, you've probably heard of the term high touch and low touch. High touch means you're selling a product or service that requires you to you to handhold the customer a little bit more. This generally means that the customer's gonna be paying a higher price tag. A low touch product or service doesn't require a lot of hand holding because the price point's usually low. And everything is pretty self explanatory. The sales process is really just automated. A good example of this is like Spotify, the music service. People usually start out with a free account where there's ads and things like that and there's limitations to that account. And then they upgrade to a paid account for 10 bucks a month. No one gives them a call, no one meets them for coffee and tries to sell them on Spotify. One of the reasons is cost, right? It's cost them so much to do that to actually have that kind of sales transaction. And it's not justified for a $10 purchase, right? $10 customer. Obviously there's a lifetime value of the customer, how long that customer is a Spotify customer. But still, even if that customer is, you know, a Spotify member for a year, that's $120 of sales. Still a very low cost item. So a very low touch sales process. High touch would be something like somebody signing a contract for a hundred thousand dollar deal. Like somebody building a company's website. Yes, people build websites for that price tag and more. But the point here is, is that in order to get that sale, a lot more handholding is required. And you need a salesperson to do that. You need somebody to through it, tell them what the benefits are. It's a bigger decision. A common example of this is buying a car, right? For the most part, people will have a high touch experience when they go into a car dealership and choose a car. They'll have a sales representative that will walk them through it, give them all the details and it's worth the investment for the car manufacturer, the dealership to do that. Because hey, each customer is dropping 30, 40, 50, $60,000 on a car. The people that kind of break this mold is Tesla. They don't have salesmen, so to speak. They have a website, they have a showroom where you just look at the car, but they're the exception, not the rule. So this is a good barometer to know if it's even worth you investing in a salesperson, let alone a sales team, is how much each sale is valued to you. I'm going to give you something a little bit middle of the road here. There's a company that we use called WP engines where we host our WordPress sites on and full disclaimer, they have been a sponsor of the show, but at the same time, they are the most expensive WordPress hosting. I know. We use them because they're incredibly reliable. Their support is fantastic, but they're expensive. You know, for a dedicated server, for what we need, for the traffic that we get on our site, we spend around $600 a month. That's a lot of money for web hosting for a website. This is not even an app, this is just a website that gets traffic. Most people spend, you know, $10 a month on web hosting. But because we need a dedicated server and because WP Engine is like the best in the game and blah, blah, blah, and because I'm spending that much money, they give me an account manager. I have a salesperson that actually comes out and speaks to me on a video call via email, follows up with me, a dedicated person, because they want to close this sale, they want to make sure that they lock me in. That's $6,000 a year. Now obviously this person who is in charge of my account or the salesperson that's assigned to me is Assigned to a lot of different accounts, maybe even hundreds. So for WP Engine, it's worth it because hey, even if they give this person a six figure salary, they're closing six grand deals left and right now. From a sales perspective, from a customer's perspective, I actually needed somebody to walk me through it and show me the economics of this $600 plan because I was actually playing more with the plan I was on that was not a dedicated server because I had overages, I was being charged for the extra traffic we were getting. I didn't have a big enough server at the time. And this plan of theirs is not something that they really advertise on their site. It's not self serve and it's a pretty big payment, it's a pretty big investment. And they know that people are not going to drop that kind of money without actually speaking to somebody or getting a little bit more detail, getting a little bit more reassurance. Now does it mean that if your product is not a 6,000, 5,000, $3,000 product a year, it's not worth having salespeople? No. The point of this conversation, of this lesson is you have to crunch the numbers. You have to do the math for your business. You have to take a look at your own cost for the product, how much profit you make per customer right now. So even if you just had customers coming in by themselves, how much money are you making on each customer after your costs are as to like, you know, to deliver the product? Now, do you have any wiggle room for some sales activity to enhance that? Say for example, you have a product that's $1,000 a year after your cost, your profit's about $800 a year. Would you be willing to pay $200 on each sale? If you can get more sales, would you be okay with giving away $200 from the $800 and making 600, but you know, 10Xing your sales, if the answer is yes, then you have room for a salesperson to start your sales team. There are plenty of salespeople that are happy to work on commission, that do this for a living. They do this for several companies, not just yours, where they'll run demos, they'll do phone calls or close deals. And for them, if your product's right, if you have a good audience or a good audience fit, they're happy to close deals because for them, hey, I can do this very quickly. $200 easy cash reoccurring, especially if it's a annual commitment. So you have to take A look at your economics as a business, your profits, and see how much you can actually offer a salesperson to do this work for you to generate more sales and make it worth their while. They're gonna make $50 a sale. It may just not be worth it if you just don't have the volume. Thy ticket, lady Jennifer of Coolidge.

Well, many thanks, good sir. Here is my Discover card.

They accept Discover at Renaissance Fairs?

Yeah, they do here. Discover is accepted at the places I love to shop. Get it with the times.

With the times. You're playing the loot. Yeah.

And it sounds pretty good, right?

Discover is accepted at 99% of places that take credit cards nationwide, Based on the February 2025 Nielsen report.

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So you want to start building your sales team, and all you got to worry about right now is start with one person. You don't need an army, you just need one person right now so you can perfect your sales model and your sales team and then find people just like this person to join the team. The first step is actually having a compensation plan, understanding what the role is going to be, how are they going to deliver the sales exercise? Do you want them to email people, phone people, get on video calls, run demos, run webinars, all the above. Write it in your job description. What are your targets? What are your goals? What is at their disposal so they can make these sales? Whether they're discounts or bonuses or resources that you may have come up with a compensation plan. It could be something as simple as commission. You know, you can have an affiliate program and give them a certain amount of commission on every sale. Some people could do a combination of a base plus commission and they give them less commission, but you know, a base salary. So they give them like, you know, fifteen hundred dollars a month. You know, again, if this is part time, this is very reasonable, plus a commission on every sale. You give them some sales targets, track those targets so you can make sure that you're getting a return on investment. All that strategy, the sales targets, how many sales you have now, what you want to have, the next month, 2, 3. How do you expect them to deliver these sales? This is all strategy. They're gonna look from you. Any great salesperson needs to know, what are they working with? They're not gonna just come up with their own strategy and just apply. It's not gonna work. You're the CEO, the leader of the company, and they're gonna look for direction. Hey, I'm a good salesperson. What do you have for me so I could sell? What do you have for me in terms of a process, a system? And that's a whole different story. I highly recommend you check out Dan Martell's YouTube channel. He has a lot of great videos on sales systems and things like that that you can definitely adopt. But it could be something as simple as, hey, I want you to email these ex clients number of times a week. I want you to make these number of phone calls, these number of webinars, these number of demo calls. I need you to convert a percentage of these people. So if you contact a hundred people in a month, let's say, for example, then you need to convert at, let's say, 10%, 20%, whatever it is. That means we get 20 new clients every month. They're paying X amount of dollars. They're, this is what we're looking for. And then let them go to work and evaluate, see how they do and see how they deliver on their promise as a salesperson. If this is rolling, if things are going well, there's only X amount of hours one person can do. Get another person. This is all benefit, right? You're all making money, even though you're paying them, you know, that commission and that salary for giving them a base. But you're making more sales, you're getting more revenue, you're getting more customers. Where do you find these people? They're everywhere. I mean, the best salespeople are recommendations from other people that you know. But you can find people that are eager to do this on upwork, on freelancer, on job forums, in groups, and Facebook. Just start creating a job description and start posting it. Start looking for people. It may not happen instantly, but you will get some interest. The point here is just get started. Now, if you've heard this episode, this sounds great, but you're still not sure, hey, do I actually need somebody to sell this product? Or is my product kind of a Spotify, where people go on a trial, they buy it, they sell it, or they get sold on it, I should say, and that's it. Your price point's pretty low. That's totally okay. But my message to you is understand there's a cost to sales regardless. So whether you're doing a free trial, a free plan, some sort of marketing, some sort of onboarding, there's gotta be something that you're spending money on to generate sales. And if you're not and you're not happy with your sales, this is an indication you're not doing something here. You're not investing in this area. One of the books I recently reviewed and had a must read episode on Product Led Growth by Wes Bush is a great book on this topic. So pick it up and that will help you with that. All right, that wraps up today's lesson. Thank you so much for listening. If you love what you hear, hit subscribe right now. And whatever you use to listen to podcasts, Spotify, Stitcher, Apple Podcast, Overcast, we're on them all. By hitting subscribe, you make sure the next episode, when it's available, downloads automatically to your device so it's ready for you to listen to when you're ready to listen. All right, before I go, I want to leave you with this. Even if sales is not your thing and you're hiring somebody to do the job, you have to know what you want. You have to know what you want them to do. You have to give them outcomes. I made the mistake early on in my career as an entrepreneur where I made hires and said, okay, you go ahead and give me some sales. And there was zero direction on my part. And of course it was a failure. It didn't really work out because there was no targets, there was no goals, there was no direction. And that's not going to come out of thin air. They're not going to make their own goals. You need to set that for them. And it also allows you to be able to up the ante and improve and, you know, raise the bar on these goals as you grow. Thank you so much for listening. I'll check you in tomorrow's episode Free Ride Friday. I'll see you then. Take care.

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