Why do SMEs struggle to recruit and retain salespeople?

As someone who has worked with SMEs for almost nine years, I have observed that one of the main challenges most companies face is growing and managing their sales teams. Sales personnel turnover rates in SMEs are higher than the average for other roles, ranging from 20 per cent in one survey to 34 per cent in another. This high rate of turnover should be a cause for concern for most companies.

The cost of hiring and training new sales staff, as well as the impact on sales performance and revenue, can be significant. It is therefore essential for SMEs to focus on improving their recruitment, retention, and management of sales personnel to build a stable and high-performing sales team.?

The big question is what causes this and what can we do about it?

I am enjoying my journey with ChatGPT at the moment, where we look at what the AI thinks and I add to it. Its reply to the question of what 3 things are the biggest cause difficulties in recruiting and retaining sales people?are excellent and well worth reflecting on. My opinion was different prior to reading its response but the more I reflected, the more the three points resonated.?

ChatGPT.

List the 3 main challenges founders and small businesses face in recruiting and retaining salespeople:

1. Competition for Talent: One of the main challenges faced by founders and small businesses when recruiting and retaining salespeople is competition for talent. Larger companies may be able to offer higher salaries, better benefits packages, or more attractive career development opportunities, making it difficult for smaller businesses to compete.
2. Limited Resources: Another significant challenge is limited resources. Smaller businesses may not have the financial means to offer attractive compensation packages, or the time and personnel to devote to a lengthy recruitment process. Additionally, they may not have the resources to provide ongoing training and development to sales staff, which can lead to lower job satisfaction and higher turnover rates.
3. Company Culture and Values: Company culture and values can also be a significant factor in recruiting and retaining salespeople. Smaller businesses may have a unique culture or set of values that requires a specific type of salesperson. However, finding candidates who share these values and can execute the required sales approach can be challenging. Additionally, a lack of alignment with company culture and values can lead to lower job satisfaction and higher turnover rates.?

Considering that its information does not take into account the last two years, it’s pretty on point with how the world is at the moment. My take on this is slightly different but you can see the the cross-over in the themes it lays out. ?

My follow-up to the above is:

Reason one

Culture and the cultural differences in how companies approach and value the sales function.?

In some regions, such as Europe, Asia, and Australia, sales may be seen as a secondary aspect of the business, particularly in professional services/Software sales/Engineering where only partners/founders may be involved in sales. However, all employees should have a part to play in sales. In contrast, in the United States, sales are viewed as a respected profession and companies build their cultures around it as a core part of their business. This is closely linked to customer service and a love for their clients. Adding to this, importantly, salespeople are highly valued in the USA.

Companies that can create a culture that values and celebrates sales success are more likely to attract and retain top sales talent. Who wants to work in a part of the business that few respect?

Reason two

The knowledge on how to effectively recruit, interview, and onboard salespeople is often lacking.?

Many companies tend to recruit randomly, often choosing people who are similar to themselves and who talk a good game. They tend not to really consider the candidate's work history, learning experiences, or past metrics and results, and usually do not properly check references. There seems to be a flippancy here, they come across brilliantly in the interview, and they will be fine, that's just a blip. Almost a desperation to get the right person.

Onboarding is often minimal, with a brief introduction to the company's products and CRM system, without much consideration for the individual needs of the new hire. The first three months of any new hire, regardless of their experience level, are critical in establishing momentum for the next 12 months and can be a significant indicator of the potential for success.

It's important for SMEs to invest in developing their knowledge and skills in recruitment, onboarding, and ongoing management of salespeople. This can include creating a structured hiring process that incorporates, good interview techniques, proper reference checks, and technology assessments and then developing a comprehensive onboarding program that addresses individual needs and implementing ongoing training and development opportunities. ?

Reason three

The capability to manage sales teams in SMEs is often poor, with little coaching skills, poor metrics, and no clear model for sales processes.?

This is problematic because even the most naturally talented salespeople will struggle to succeed in a team with poor management, lack of structure, inadequate coaching and poor metrics. To be a high-performing team, culture, structure and the necessary skills are crucial both for management and sales.?

However, founders/senior management are often expected to transition from product design and go-to-market strategies to successfully building and managing a sales team, despite lacking the experience and expertise required. Building and managing a successful sales team is a new skill that takes years to master, and it can be challenging for founders/senior management to devote the necessary time and resources to develop these skills.

What are the solutions to this?

We are running a webinar that works through some of the answers.

1. What resources do you need to build a sales team
2. How do you find the right candidates
3. How do you interview and what tools should you be using
4. How do you onboard salespeople successfully?
5. What should your sales culture look like
6. How do you manage a high-performance sales team

Register here for the session and get some insights from Sales and recruitment experts on the above areas.?

https://www.dhirubhai.net/events/salestalentandhowtorecruitahigh7033250482567487488/