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Six Sales Challenges Faced by B2B & B2C Startups

Updated: Aug 24, 2022

Startups who sell to enterprises or individuals often find selling a challenge. A Startup can go from initial success to failure or from near disaster to solid turnaround in less than six months due to its sales approach. I have come across many Startup founders from both scenarios. One of the key differentiators is the Sales Strategy. Almost all these products had the capability of disrupting the industries. And yet, despite the compelling product and initial success, they were finding it hard to grow their sales. Why?

Based on my discussion with these founders, I am sharing the top five challenges faced by Startups and their solutions:

Challenge No. 1 - Not having a robust sales process.

The management team had not believed in 'Sales' as an independent discipline like Product Development, Finance, and Marketing. Each department had applied strict processes and policies - but not for Sales. They had no way of assessing where they were in a sales opportunity and how effectively it was progressing. As a result, they were pouring resources into high-risk opportunities or ones that were not likely to develop further or have insignificant revenue potential. They were performing sales activities without a standard structure. Their sales team mostly pitched the product features, gave free demos, and proposed their product/service as the best solution before analyzing & understanding the customer needs, budget, and priorities. The potential customers struggled to know the buying process, delivery & implementation time, and after-sales service process. They had regularly wasted time trying to sell to individuals in an organization who had no power to decide. As a result, they failed to achieve their sales projection (number and revenue together). Under immense pressure, some salespeople used inappropriate practices to acquire customers and burn the market. The result – is fast moving towards a massive failure.

The solution: There are various sales methodologies available to be adopted as they are or with some adjustments to suit your industry. These are Challenger sales, SNAP selling, SPIN selling, Sandler system, Conceptual selling, Inbound selling, Outbound selling, Hybrid Selling, and Solution and value selling. But how do you find out which one is best for you? The best way is to seek help from a specialist. The specialist will evaluate and suggest the best sales methodology for faster sales growth – numbers and revenue both. Once decided, make sure to align all the departments to this methodology so that they understand the need and value of their contribution for seamlessly delivering a delightful experience to each prospect/customer. It helped them systemize activities like:

1. How to identify & approach the right target market.

2. How to evaluate & communicate with prospects at the different levels of the sales funnel?

3. How & which information to give to prospects at the various stages of the buying cycle?

4. How to help the prospects complete the buying process comfortably for faster acquisition and delivery of product/service?

5. How to get better insight into individual prospective customers?

6. How to create a strategy for winning a competitive opportunity?

Challenge No. 2 – Unplanned & not recruiting the right salespeople.

The most crucial component of creating a successful sales team is, having a strategy and process to find salespeople with the required skills (both soft and hard). Most Startups do not have a recruitment calendar and process for recruiting the right salespeople. The result – is uncontrolled high expenditure on recruitment, low productivity, bad customer experiences, and high churn.

The solution: Design a recruitment calendar and evaluation process for recruiting the most suitable people in a planned manner. Start working on your recruitment at least 3 – 4 months before hiring. The availability of the right talent in the market keeps changing, and starting earlier will help you mitigate this uncertainty, and you will be able to recruit as per your plan. Having a recruitment strategy & timely implementation will keep you ahead of your requirements. Some of these crucial activities are – designing a suitable candidate evaluation process, using different channels (internal & external) of recruitment, impanel the right recruitment agency or online platform, and onboarding process.

Challenge No. 3 - Inadequate product knowledge & sales training.

Assuming that recruiting the most suitable candidates will generate desired sales automatically is one of the biggest mistakes most Startups commit. While you may have the best-selling skills, with the product knowledge, understanding of the target market, knowledge of customer experience, and authority to negotiate, your sales team will not be able to deliver the expected performance. Also, the customers will not have a delightful experience buying your product/services.

The solution: Hence, it is highly critical to have a process for onboarding new salespersons – joining, induction, training, and field hand holding. The sales team must be trained and then coached through regular reinforcement sessions. They must develop basic sales activities as their strong habits. The sales training and skill development program must be around the sales methodology adopted. The customer-centric approach, discovery process, creation of a customer value proposition, proving value, verifying their claims, offering solutions, negotiation, and closing of sales must be reinforced and reiterated. All this with one objective of solving the customer problems. Along with this, implement sales management activities. It included setting up sales performance measurement systems, incentive programs, lost sale analysis, opportunity strategy development, progress reviews, and salesperson growth plans.

Challenge No. 4 - Not able to build a culture of a customer-first approach with the Sales and Customer Service teams.

Products and services can be copied and improved by competition, but not the customer experience. And this is the biggest differentiator between a successful Startup/organization and a failed one.

Many organizations talk about the customer-centric approach but fail to provide clear steps and ways to their employees to implement it. And eventually, a customer success/service team is in charge of it exclusively. Not understanding that it must be discernible and felt by the customers at all touchpoints and on crucial occasions. Building a culture takes a lot of effort, persistence, reinforcement, and demonstration by the leadership team to the employees.

The solution: Have a defined process & clear guidelines on how to respond to the customers in different situations. What is negotiable and what is non-negotiable. Provide complete clarity and communicate steps to implement a customer-centric approach. The leadership team must work in a market with the sales and customer service team to deliver and demonstrate. Everyone should be involved, regardless of department or area of expertise, as it will speed up building the culture in the organization.

Challenge No. 5 - No sales management system – not managing the sales activities, capturing and analyzing the market & customer data

The only sales management system that most Startups implement is a rudimentary forecasting system. And because of the lack of a proper sales process, the forecast is dreadfully inaccurate. There is no monitoring of sales performance data, such as the quantity and quality of leads, the number of demos, the conversion rate, and the buying cycle. And without which the sales revenue (or cash flow) forecast becomes challenging. Performance assessments for the sales team are usually unstructured, and the team is generally unaware of their KPIs. Reviews often focus solely on revenue data, ignoring other crucial performance indicators such as prospecting, sales pipeline, cold, warm, and hot leads, customer meetings, proposal submission, and more.

The solution: Put in place a basic sales management procedure. Keep a close eye on your sales funnel. Determine the best ways to respond to clients based on where they are in the buying cycle and what is required to move them forward. Assess potential obstacles and come up with possible solutions in advance for a proactive approach. Adopt and use CRM to collect organized information about sales and customer interactions in one place. All this will generate data for reviewing the sales team's performance and designing better strategies to improve performance & productivity.

Challenge No. 6 – Founders struggling to find time to do all this & more

Sales are not the responsibility of the Sales team alone. Implementing these solutions by themselves won't increase sales or revenue. Every employee of the Startup/organization needs to be involved in this. Customer service, marketing, finance, and product development all play significant roles. As a result, placing excessive pressure on the sales team while ignoring the involvement of other departments would cause wrong selling, low productivity, a bad environment, attrition in the sales team, and difficulty in hiring the best candidates.

Founders are often struggling to manage time for all these activities. Since most of them have strong technical backgrounds and come from non-sales and marketing backgrounds, they often spend more time on product development, fundraising planning, pitching, and regulatory compliance. They hardly have any time left to invest in developing a sales operation.

The solution: Building a successful sales operation isn't a secondary job. It is critical for the success and continuous growth of the Startup. Therefore, having a dedicated resource will make a huge difference. A cost-effective and best solution - Hire a specialist/expert. Recruiting a full-time sales leader may not be a financially viable option in the beginning. Therefore, consider hiring a virtual sales leader who can help you build your sales operation. Hiring a virtual sales leader can help you delegate work and get everything needed to create the sales operations done with the least amount of involvement from you, which will help you save money on the high monthly salary expenses. It will be advantageous and economical to have a dedicated resource handling the building sales operations. You must engage this resource as a member of your leadership team because it helps as a better and faster information exchange bridge between various departments. You will be in a much better position to hire a full-time sales leader groomed internally or hired externally as the sales operations are built and running successfully. It is significant from both a financial and strategic standpoint.

Make sure to involve, invite, and motivate everyone in the organization to contribute to helping the sales team acquire paying customers. Facilitate quicker team communication, quick response to customer comments and suggestions, clarity regarding what can be done & what cannot be done, sharing of updates on product development and adjustments, market communication changes by a marketing team, and empowering the customer service employees to please customers. To increase sales and revenue, the entire organization must collaborate. Everyone plays an important role, and the leadership team should lead by example.

Just by implementing above mentioned solutions - You will be teaming better, applying resources more productively, and having better control of the operational efficiency. You will be much more strategic in your pursuits, speed up your success journey and achieve better milestones than without it.

I hope this gives you some food for thought - and impetus for action!

You might be dealing with some sales operation problems distinct from those experienced by other entrepreneurs. We can help you find the right solutions economically. Give us a call on +91 848494 9616 to explore possibilities.

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