The ROI of Sales Training for Your Non-Sales Team will Surprise You
A lot of managers believe investing in training is a little bit like what it used to be like investing in advertising; “I know half of my ad spend is working, I just don’t know which half!”
Not so with sales training. Calculating an ROI for sales training is simple and easy, and sales training done properly will almost always pay for itself. Which is also why successful, professional sales people are continually refreshing their skills.
Sales Training for Non-Sales Staff
But what happens if you invest in your non-sales team? Is the return likely to be incremental (as is most likely the case for pro-sales teams) or much more significant?
A customer that has already purchased is both:
a) more likely to purchase again and
b) much less expensive to convert into new opportunities.
Even if you don’t have a product or a service that lends itself to repeat purchases, existing clients can still yield potential new business.
And when you give your account managers, client services managers and any other employees in client facing roles some basic sales skills the profitability potential is hugely magnified, especially when compared to the same investment in your new business sales team.
Let’s look at an example.
Say your sales team is generating $800k in new business annually and your existing client base is worth $3M. That’s an excellent annual growth rate of 27%. But the cost of acquiring these new customers (including sales and marketing costs) is $300k, yielding an ROI of 1.67 or 167%. The math looks like this: (800-300)/300
If you were to train your client services team in sales skills and you spent a generous $50k on training and allocated 20% of this team’s salary costs of $325k to generate the same $800k of new revenue from existing clients your ROI would be 5.96 or nearly 600%! That kind of profit isn’t even in the same ballpark. *assumptions below
If your non-sales team generates the same new business as your sales team the ROI is nearly 5 times greater!
But how likely is it that your team of non-sales account specialists will be able to generate the same amount of new business as your sales team? What would the numbers look like if your account team was able to grow business from existing clients by only 10%?
Using the same existing client base numbers as above:
$3M x .1 = $300k of new business.
If your client services team spent 20% of their time actively developing new business opportunities, you would still end up with an ROI of (300-115)/115 = 1.61 or 161%. And that would be revenue and profit you hadn’t even counted on.
If you allowed them only 15% of their time (somewhere in the region of 6 hours per week) to work on building client relationships specifically for the purpose of seeking out new opportunities ($325k x .15 = 48.75k + 50k training costs) your ROI would be
(300,000-98,750)/98,750 = 2.04 or 204%
Sales training for your non-sales team can have an ROI as high as 200%
If you’re a numbers person you should be plugging all these scenarios into a spreadsheet and really playing with the possibilities!
It’s certainly feasible that allowing your non-sales team only 15% of their time to work on finding new business after investing in training could yield an even greater growth in sales.
Sales Training for Non-Sales People Yields High ROI
Even with all the unknowns in these examples, two things are certain:
1. Providing sales training for your non-sales team will result in additional profit
2. An investment in sales training yields an outstanding ROI
I think you can see where I’m heading with this. Investing in sales training for non-sales team members has much, much greater profitability potential. Yes, their primary purpose is to service existing clients and deliver the work that your sales team has promised. But in doing that with a customer focus plus some relationship building skills, some sales questioning technique, and opportunity spotting eyes, your business has the potential to increase profitability exponentially.
Shouldn’t that be worth investigating?
*Here’s how I arrived at the numbers in the example.
Salaries for team of two salespeople $100k, $60k marketing spend, $40k sales costs.
Average salary $65k for team of five = $325k
Total acquisition cost = 325 x 0.2= 65k + 50k = 115k therefore ROI is (800-115)/115 = 5.96