Benchmarking research highlight: investing in sales timeBy: Alexander Group Sales Benchmarking
Before adding more sales headcount, a sales leader should first analyze sales rep time. Careful time analysis will show whether more sales headcount, or more sales support will lead to a higher sales ROI. Sales results are ultimately a function of selling time. If reps have ample selling time, more rep headcount means more revenue. However, selling time needs to be supported by pre- and post-sales activities. If reps spend more time than necessary on sales support, adding support capacity can free up more time for selling.
Typically, sales support responsibilities are shared between sales reps and corporate support resources. According to AGI’s Sales Time Benchmarking Database, a typical Fortune 1000 field rep spends only 32% of their work week selling. Every hour of selling time requires 1.5 hours of his or her own time in pre-sales and post-sales support. And this takes into account normal support resources from corporate.
|Stratified Time Categories||Time Allocation|
|Pre-Sales (Lead Generation, Account Planning…)||22%|
|Selling (Sales calls, demo, proposal, negotiation…)||32%|
|Post-Sales (Order Management, Customer Service…)||24%|
|Non-Sales (Administrative, Travel, Training…)||22%|
If there are not enough support resources, or if the support is not efficient, sales reps need to step in and shoulder more support responsibilities, which inevitably decreases their selling time. When a sales force reports average selling time below 25%, chances are good that sales support constraints or sub-optimal processes have become a bottleneck. Under these circumstances, adding rep headcount only aggravates the sales time shortage because more people are competing for limited support resources. The correct strategy in this case calls for an increase in support headcount and/or investments in systems optimization. In essence, sales leaders should invest in more headcount in the areas where reps report above-normal time expenditures. If selling time is low, sales leaders should invest in non-selling areas. If selling time is good, investing in more sales headcount makes perfect sense.
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Originally published by Ian Zhao and Ben Koupal.