The Future of the SDR Is Outsourced
Hiring internal SDRs costs more time and cash.
So you're ready to build or grow your sales team?
Building your sales team used to work like this:
Oddly enough, some startups believe this is still the best way to build or grow a sales team today.
Fortunately, this is trending the opposite way. Companies are wising up and realizing that building a sales team doesn't work this way anymore.
Times have changed.
Let's go into the issues with hiring internal SDRs.
Costly
According to a study by Betts Recruiting, the yearly total for an internal sales team can have quite the price tag.
The cost breaks down as follows:
$110,000 per year for SDR #1.
For SDR #2, an additional $110,000 per year.
$50,000 per year for an SDR manager.
$40,000 per year for the technology stack that's needed to get the job done.
That's over $300,000 per year in hard costs, not to mention the soft costs.
The cost of building your sales team internally is underestimated.
Fleeting
SDRs aren't as loyal to their organizations anymore and don't think about a typical sales career path in the way many professionals used to.
This is exacerbated by the recent trend of many new SDRs wanting to get into tech sales.
Some SDRs, and those potentially attracted to technology companies, may have a shortsighted outlook and are always looking for the next highest compensation plan.
Many new SDRs understand that they can train for several months and jump to a higher total compensation plan even if they fail to hit their quota of meetings booked.
The days of the SDR following the traditional sales organization hierarchy aren't as attractive as they used to be, either.
Before, SDRs might be SDRs for several years, aspire to become an AE (account executive), then a manager, and so on.
Today, it might be more desirable to be an SDR for ten years and earn more money and have more flexibility than they could've otherwise.
Going from SDR to VP or SDR to founder is also highly probable, given that having SDR skills means you can find customers and build a business.
Given the fleeting nature of SDRs today and less desirability of the typical track, internal SDRs are a risk to jump ship early.
As you can tell, these behaviors and market trends not only present a problem for any company looking to build an internal sales team, but it can make building that team impossible.
The best SDRs today are looking for a deeper connection with meaningful work as opposed to following a pre-set track within a sales organization.
Time
What's not mentioned in the total SDR cost per year is time, which can be invaluable and hard to measure.
Typically, the ramp time for any SDR inside an organization can be rather time intensive. New SDRs might take three to four months to get fully acclimated and fire on all cylinders, if they do at all.
When an internal SDR decides to leave the organization, they take the past four months with them. At minimum, it takes another thirty days to hire a new SDR.
This is time the organization can't get back and it's demoralizing to the internal team.
Resonance
The main issue companies face might be lack of mutual resonance.
Today, top SDRs want to enjoy flexibility and freedom.
They want diversity in their experience. SDRs want to be challenged with interesting objectives during workdays.
They want to see themselves learn new tactics and execute them. They want to grow and advance.
If the company is falling short on any of these items, that's a big risk towards keeping the SDR engaged.
Top SDRs are attracted to work as external SDRs at agencies and companies need this type of talent so they avoid the woes of internal SDRs.
When building SDR teams, companies need to optimize for the right people fits.
Companies and SDRs need to map to each other.
Oftentimes, the mapping is unclear.
Solution
Here is how to avoid trying to fit a square peg into a round hole.
Put the SDR function on the outside of an organization by hiring external SDRs through a managed outbound SDR agency.
The SDRs that work at agencies are punching way above their weight class. They're a catch. They have demonstrated experience that allows companies to avoid the risks of hiring internally. And they are far more economical than internal SDRs.
With external SDRs, fit can be almost seamless.
For a reasonable monthly fee, per SDR, you can remove the risk, avoid a lot of pain, and get the right people and the right process.
It's a no-brainer that will allow you to achieve a great ROI on your SDR team and become a better, faster, and stronger company.
Building your sales team used to work like this:
- Post a job advertisement for an SDR (sales development representative).
- Have applicants go through a long interview process.
- Hire an SDR.
- Train them for three or four months.
- Hope it all goes well
Oddly enough, some startups believe this is still the best way to build or grow a sales team today.
Fortunately, this is trending the opposite way. Companies are wising up and realizing that building a sales team doesn't work this way anymore.
Times have changed.
Let's go into the issues with hiring internal SDRs.
Costly
According to a study by Betts Recruiting, the yearly total for an internal sales team can have quite the price tag.
The cost breaks down as follows:
$110,000 per year for SDR #1.
For SDR #2, an additional $110,000 per year.
$50,000 per year for an SDR manager.
$40,000 per year for the technology stack that's needed to get the job done.
That's over $300,000 per year in hard costs, not to mention the soft costs.
The cost of building your sales team internally is underestimated.
Fleeting
SDRs aren't as loyal to their organizations anymore and don't think about a typical sales career path in the way many professionals used to.
This is exacerbated by the recent trend of many new SDRs wanting to get into tech sales.
Some SDRs, and those potentially attracted to technology companies, may have a shortsighted outlook and are always looking for the next highest compensation plan.
Many new SDRs understand that they can train for several months and jump to a higher total compensation plan even if they fail to hit their quota of meetings booked.
The days of the SDR following the traditional sales organization hierarchy aren't as attractive as they used to be, either.
Before, SDRs might be SDRs for several years, aspire to become an AE (account executive), then a manager, and so on.
Today, it might be more desirable to be an SDR for ten years and earn more money and have more flexibility than they could've otherwise.
Going from SDR to VP or SDR to founder is also highly probable, given that having SDR skills means you can find customers and build a business.
Given the fleeting nature of SDRs today and less desirability of the typical track, internal SDRs are a risk to jump ship early.
As you can tell, these behaviors and market trends not only present a problem for any company looking to build an internal sales team, but it can make building that team impossible.
The best SDRs today are looking for a deeper connection with meaningful work as opposed to following a pre-set track within a sales organization.
Time
What's not mentioned in the total SDR cost per year is time, which can be invaluable and hard to measure.
Typically, the ramp time for any SDR inside an organization can be rather time intensive. New SDRs might take three to four months to get fully acclimated and fire on all cylinders, if they do at all.
When an internal SDR decides to leave the organization, they take the past four months with them. At minimum, it takes another thirty days to hire a new SDR.
This is time the organization can't get back and it's demoralizing to the internal team.
Resonance
The main issue companies face might be lack of mutual resonance.
Today, top SDRs want to enjoy flexibility and freedom.
They want diversity in their experience. SDRs want to be challenged with interesting objectives during workdays.
They want to see themselves learn new tactics and execute them. They want to grow and advance.
If the company is falling short on any of these items, that's a big risk towards keeping the SDR engaged.
Top SDRs are attracted to work as external SDRs at agencies and companies need this type of talent so they avoid the woes of internal SDRs.
When building SDR teams, companies need to optimize for the right people fits.
Companies and SDRs need to map to each other.
Oftentimes, the mapping is unclear.
Solution
Here is how to avoid trying to fit a square peg into a round hole.
Put the SDR function on the outside of an organization by hiring external SDRs through a managed outbound SDR agency.
The SDRs that work at agencies are punching way above their weight class. They're a catch. They have demonstrated experience that allows companies to avoid the risks of hiring internally. And they are far more economical than internal SDRs.
With external SDRs, fit can be almost seamless.
For a reasonable monthly fee, per SDR, you can remove the risk, avoid a lot of pain, and get the right people and the right process.
It's a no-brainer that will allow you to achieve a great ROI on your SDR team and become a better, faster, and stronger company.
Post by Rob Whitley.
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