The Strategic Business Blog

Does Hiring Your Way Out of a Small Business Sales Problem Work?

Posted by Terry McGill

Small business sales problem

When small business owners have a sales and/or marketing problem, they will often try to look for a quick fix and will attempt to hire their way out of the problem. Trying to solve a sales problem this way can have a high degree of risk and create additional management and profitability problems.

While having someone at your small business dedicated to sales and marketing can be a good idea, many owners have lost thousands, if not tens of thousands, of dollars because the owners were not prepared to hire this position into their firms. Hiring a sales or marketing person might be a very good fit for an owner, if they are prepared and understand what they are trying to accomplish with this role and position. When owners assume this new role will produce a good return on investment for them, problematic issues can develop. Most of the time, owners believe they are being proactive by hiring their way out of a sales problem, right?

Not necessarily.

The situation typically starts with a business owner deciding it’s time to do something to help increase their business. They either have no idea how to sell or market effectively or no time to do it.

So, they decide to hire their way out of the problem.

At first, it makes sense to them to hire a sales and/or marketing person. They hire someone who seems like they’re good at building relationships or someone that has been in the business before. The difficulty in most cases is the owner themselves, who may not have any idea what they were doing in hiring that position. They simply wanted to increase their sales, which most owners do.

After a period of time, they start to wonder if this person is as effective as they should be. It seems like they should be getting better results than they are but the owner really isn’t confident in knowing what kind of results they should be seeing. They’ve never really had any good sales and/or marketing management training or experience themselves.

The owner has no idea how to manage the position. They don’t know what this person should be doing, how to monitor them or hold them accountable. They certainly don’t know how to train them. Then there is the question of how to compensate this position. Structuring a compensation package that will fit the position and produce positive results for the owner is extremely important.

Then, they realize the sales or marketing person is not effective.

  • Maybe they're not creating enough leads
  • They may be having lots of conversations but are not generating more business
  • They may never have had quality training that applies to your industry – while there are always elements of business that are the same no matter what industry, being able to effectively create new business in your industry may take a unique skillset and set of strategies.
  • They may truly want to do a good job and learn what it takes to be effective but you really don’t know how to help them.
  • Even worse, they may be tarnishing (usually unintentionally) your brand in the marketplace.

We’ve seen some owners let this go on for 2-3 or more years. We’re talking tens of thousands of dollars each year being paid to someone who was not producing a positive ROI (return on investment) for the firm. This position was not profitable for the owner and they had yet another management challenge to deal with.

Has this happened to you or another small business owner you know? It’s an extremely common scenario in small businesses.

In most of these situations, the responsibility falls on the owner’s shoulders. If the position is not well-defined and the owner is not prepared to manage the position before the person is hired, the right person isn’t hired, or the position is not set up to work within an overall sales and marketing strategy, the results will never be optimal.

Most of the time, these situations are created up front within the hiring process because many owners are not sure of how to go about hiring the right individual into the right position. It’s a common issue for small business owners.

So, before you decide to just hire a new employee or any resource, make sure the structure and controls are in place for the position and you’ve prepared yourself to be able to manage it. If not, you’ll simply just be trying to hire your way out of a problem and will likely encounter more problems because of it.

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ABOUT THE AUTHOR:

Terry McGill is a small business consultant and managing partner of Strategic Business Directs. Connect with him on LinkedIn.

Topics: increase sales, Small Business, Marketing Strategy, Hiring Problems