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Useful Advices - Outsourcing the Sales Function
Small to medium companies that want to increase sales or profits and find it is possible to outsource sales should - do it! At this point most business owners and executives either become overwhelmed with doubt or fear.
Here's what we hear: "We can't give up control of sales, that's too risky." Or "Our products can't be sold by anyone but us, they are too complic
Here's what we hear: "We can't give up control of sales, that's too risky." Or "Our products can't be sold by anyone but us, they are too complic
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
ated for anyone else to understand."
Many small companies outsource accounting and legal work, but still find using contracted sales professionals universally out of the question. Unfortunately, most small to medium sized companies are good at one thing: making a particular product or providing a particular service - not selling.
Hence, many companies find the
Many small companies outsource accounting and legal work, but still find using contracted sales professionals universally out of the question. Unfortunately, most small to medium sized companies are good at one thing: making a particular product or providing a particular service - not selling.
Hence, many companies find the
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
mselves dissatisfied with the salespeople they hire. They tend to hire people who have experience with a product or market and figure they can teach them how to sell.
This, rarely works, and the company ends up with a product expert who just is not selling. A lose-lose situation is born.
There are many industries that have a preponderance of willing and able par
This, rarely works, and the company ends up with a product expert who just is not selling. A lose-lose situation is born.
There are many industries that have a preponderance of willing and able par
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
ners that are looking for new and innovative (read profitable) products to sell.
The vast majority of these re-sellers operate on a regional basis, other work on a national or even international level.
There are even companies that will set up and manage the entire process for you, and some will even manage your marketing activities as well.
So what makes this
The vast majority of these re-sellers operate on a regional basis, other work on a national or even international level.
There are even companies that will set up and manage the entire process for you, and some will even manage your marketing activities as well.
So what makes this
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
approach so good? Here are seven reasons:
* Pay for performance.
Contracted re-sellers do not get paid unless they sell something. They will either receive a commission on the goods sold, or be sold the goods at a discount which they in turn mark up and sell for a profit. This lowers your risk of having to pay salary and benefits and can also allow you to put mo
* Pay for performance.
Contracted re-sellers do not get paid unless they sell something. They will either receive a commission on the goods sold, or be sold the goods at a discount which they in turn mark up and sell for a profit. This lowers your risk of having to pay salary and benefits and can also allow you to put mo
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
e feet on the street faster because you're not handcuffed by these costs.
* They already know how to sell. Professional sales organizations, whether they are called reps, agents, distributors, wholesalers, partners - whatever - have one thing in common, if they don't sell they don't get paid. This pretty much ensures that resellers who've been in business for an
* They already know how to sell. Professional sales organizations, whether they are called reps, agents, distributors, wholesalers, partners - whatever - have one thing in common, if they don't sell they don't get paid. This pretty much ensures that resellers who've been in business for an
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
y length of time already knows how to sell.
* Specialization.
Re-sellers tend to pick a niche and specialize in particular industries and markets. So they spend their days in this environment and know what needs to be known from a business and technical standpoint. Therefore, if you pick the right ones they surely can handle your "complex" product.
* Instant c
* Specialization.
Re-sellers tend to pick a niche and specialize in particular industries and markets. So they spend their days in this environment and know what needs to be known from a business and technical standpoint. Therefore, if you pick the right ones they surely can handle your "complex" product.
* Instant c
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
redibility.
An established re-seller has been calling on companies in their market or territory for years and has long standing relationships in place. These relationships allow them to call their contacts within a target company and easily get some time to present a new product or service that they are now handling. This is, obviously, a lot more effective that
An established re-seller has been calling on companies in their market or territory for years and has long standing relationships in place. These relationships allow them to call their contacts within a target company and easily get some time to present a new product or service that they are now handling. This is, obviously, a lot more effective that
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
aving an inside salesperson from the your company cold calling on the same target companies. These existing relationships, therefore lead to increasing a product's speed to market.
* Other lines bring leads.
Almost all re-sellers have other products to sell. In selling these other products they will uncover opportunities for selling yours.
* They will tell it
* Other lines bring leads.
Almost all re-sellers have other products to sell. In selling these other products they will uncover opportunities for selling yours.
* They will tell it
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
like it is.
They need you to be doing the right thing because they need to make money, not secure their job. Therefore, you will get candid and timely feedback from the field, allowing you to serve you customers better. Often, feedback received from a rep and one territory can be used to improve relationships and increase sales in all territories.
* An enhance
They need you to be doing the right thing because they need to make money, not secure their job. Therefore, you will get candid and timely feedback from the field, allowing you to serve you customers better. Often, feedback received from a rep and one territory can be used to improve relationships and increase sales in all territories.
* An enhance
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
sales function.
This approach can replace or enhance your current sales function. In some cases it is appropriate to disband an existing direct sales force and commit fully to an indirect or outsourced sales strategy. In this instance you would have a sales manager working directly for you or hire a sales management agency to recruit and manage your indirect sal
This approach can replace or enhance your current sales function. In some cases it is appropriate to disband an existing direct sales force and commit fully to an indirect or outsourced sales strategy. In this instance you would have a sales manager working directly for you or hire a sales management agency to recruit and manage your indirect sal
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
es force. In other instances a company may choose to retain all or part of its direct sales force to certain markets, or manage certain accounts, and outsource other pieces. Despite the many virtues of outsourcing there are some caveats.
First, you've got to pick the right ones. Independent re-sellers need to be selling products and services that line up with yo
First, you've got to pick the right ones. Independent re-sellers need to be selling products and services that line up with yo
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
ur offerings. They also need to be selling to the right customers, and the right players within those companies. (Example: You don't want a re-seller that makes its living calling on purchasing agents if engineers or CFOs are responsible for making the ultimate buying decision for your offering.) Taking the time to find the right reps is more productive and cost e
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
ficient than taking the first that express an interest. You don't want to spend the recruiting and training resources twice if you don't have to.
Secondly, treat them well and they sell. Simply put, re-sellers follow the money. If your commission rates are on the low end of industry average, you give no added incentive for meeting quota, or you just make doing bu
Secondly, treat them well and they sell. Simply put, re-sellers follow the money. If your commission rates are on the low end of industry average, you give no added incentive for meeting quota, or you just make doing bu
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
siness difficult, an average agent will spend his time selling other products.
If your commission rates are good, you offer attractive incentives and you make their lives easy, you'll have agents that turn over every stone in effort to sell your products.
Three other major factors in using an independent sales force are: Support, support, and support. A good re
Three other major factors in using an independent sales force are: Support, support, and support. A good re
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
will know a lot about your product, they will also make sure they know what they don't know. When faced with a question from a customer for which they don't know the answer, a good sales agent will say, "I don't know, but will have you the answer tomorrow."
It is your job to make sure that you provide them with assistance in finding such answers in a timely fas
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
hion. You should also make it a practice to share these questions and answers with the entire sales channel, because questions usually arise in multiple places.
Lastly, outsourcing sales is a commitment. You need to realize that it is going to take some time to establish the sales channel. Usually the same year to eighteen months it takes to get a direct sales pe
Lastly, outsourcing sales is a commitment. You need to realize that it is going to take some time to establish the sales channel. Usually the same year to eighteen months it takes to get a direct sales pe
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
rson up to speed. With this approach, however, you can have twenty to forty individuals up and selling for you, rather than a handful. Also, with regard to commitment, you cannot vacillate between direct and indirect selling. If the independent channel feels you will be selling direct again soon, they will slow their efforts to a crawl. Plus, word travels fast, if
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
you went from indirect selling, back to direct, agents will be hesitant to engage you if you decide to go back to the indirect approach.
Outsourcing, or indirect selling has been going on for ages. As companies become more conscious of their bottom lines and to sticking to their core competencies we are seeing a renewed vigor in this approach.
If you're a small
Outsourcing, or indirect selling has been going on for ages. As companies become more conscious of their bottom lines and to sticking to their core competencies we are seeing a renewed vigor in this approach.
If you're a small
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
or medium sized company that is looking to grow sales and you're in one of the many industries that lends itself to outsourcing the sales function, it is surely worth investigate.
Gaetan Giannini is a partner in Giannini O'Connor LLC, a full-service marketing/PR firm whose goal is to increase clients' sales through imagination. Contact him at gaetan@goimagine.bi
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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