If you’re a founder or commercial leader one of the biggest decisions you can make is how to build your outbound sales function. Getting it wrong could mean wasted budget and time, and could set your pipeline back by months. But if you get it right, you can unlock growth and enable your business to thrive.
Investing in sales capacity is a must, but what’s the best way to do it? You could build an in-house team and keep everything under one roof, or you could outsource and enjoy the benefits that brings – which we’ll get onto shortly. This article takes an in-depth look at the pros and cons of in-house vs outsourced sales teams, to help you decide the best way to move forward with your business.
What Is an In-House Sales Team?
An in-house sales team consists purely of professionals hired by your business, working exclusively for you. They work within your culture and management structure, with roles such as Sales Development Representatives (SDRs), Account Executives (AEs) and Sales Managers.
An internal team is the traditional approach to sales and may seem like a natural choice for many businesses, but selling this way requires considerable investment.
The Pros and Cons of an In-House Team
If you want full control over culture, messaging and process alignment, an in-house team is a good choice. Another benefit is that over time, reps develop in-depth knowledge about your products, as well as establishing valuable relationships with customers.
However, building an in-house team is costly, time-consuming and not without risk. We’ll explore this below, but you can also learn more in our guide to outsourced lead generation vs building an internal team.
What Is an Outsourced Sales Team?
Outsourced sales is where a third-party provider takes responsibility for part or all of your sales operation. They often handle your prospecting, lead generation and pipeline generation. As this is an external business, you pay a service fee as opposed to employer costs, and the hiring, training, tooling and performance are all done by the third party.
The Pros and Cons of an Outsourced Team
A significant benefit of outsourced providers is that they can often get you operational within two to four weeks, versus the three to six months it typically takes to hire, onboard and ramp an in-house rep.
The trade-offs include having less day-to-day control, and having to invest some time for briefing and alignment upfront.
In-House vs Outsourced Sales Teams: A Direct Comparison
Before examining when these different models might make most sense, let’s look at a quick comparison.
| Category | In-House Sales Team | Outsourced Sales Team |
|---|---|---|
| Control | Full control over processes, messaging, and strategy | Less direct control; relies on external partner alignment |
| Cost Structure | High fixed costs (salaries, benefits, training, tools) | Variable costs (pay per performance, contract-based) |
| Setup Time | Slow to build (recruiting, onboarding, training) | Fast to deploy; ready-made teams and systems |
| Expertise | Deep product and company knowledge | Broader industry experience; may lack deep product immersion initially |
| Scalability | Harder to scale quickly | Easy to scale up/down based on demand |
| Flexibility | Less flexible due to internal structure | Highly flexible; contracts can adapt to needs |
| Brand Alignment | Strong alignment with company culture and voice | Requires training to match brand tone and values |
| Performance Management | Direct oversight and coaching | Managed through KPIs and service-level agreements |
| Technology & Tools | Requires internal investment | Often comes with existing tools and tech stack |
| Risk | Higher long-term financial commitment | Lower risk; easier to switch providers |
| Innovation & Insights | Limited to internal experience | Access to cross-industry insights and best practices |
When Should You Build an In-House Sales Team?
You Have the Budget and Capacity to Absorb the Full Cost
In year one, a single in-house SDR will cost you somewhere between £55,000-£75,000, factoring in salary, auto-enrolment pension, recruitment fees, equipment and training. And that’s before you consider the expense of management time.
Your business therefore needs to be comfortable absorbing the cost of building an in-house team, as well as the time it takes to get new recruits up to speed.
You Can Absorb a 3-6 Month Ramp-up Period Before Seeing ROI
It takes around three to six months for a new sales hire to become fully productive, so time is certainly something you need to consider when deciding on how to build your sales capacity. That can be a long time to wait if you’re under pressure to build your pipeline quickly.
You Have the Internal Management Infrastructure to Run a Sales Team
An internal team of course means the need for internal management infrastructure. Sales professionals need coaching, accountability and performance management structures. If you already have that in place an in-house team could work well – if not, you need to consider the added complexity and cost building this capability would involve.
When Does Outsourcing Your Sales Team Make Sense?
You Need Pipeline, and You Need it Quickly
Outsourced sales can be a smart choice if you want to get operational fast – in as little as two to four weeks. This gives you a huge head start on revenue and allows you to show pipeline growth incredibly quickly. It also eliminates the significant bottleneck of hiring and the time and expense it involves.
You’re Testing a New Market or Product
Hiring internal sales staff before you’ve validated a new market is risky. If things don’t go as planned you might have to face the upset, disruption and cost of redundancy, as well as absorbing the expense of recruiting and training these hires in the first place. Outsourcing lets you test a market without committing to extra headcount. And if the hoped-for opportunity isn’t there, you can adjust easily and cleanly.
You Want to Scale Activity Without Scaling Headcount
Hiring internal sales people is a slow process and as mentioned, it can take months before new reps are as productive as you’d like them to be. Outsourced sales teams, on the other hand, can help you scale up and down as you need in a pleasingly flexible way. This agility can’t really be replicated with internal teams, and it’s especially valuable if your business is in growth mode, or you operate in seasonal markets.
You Want Predictable Costs with Less Operational Risk
The turnover of sales professionals can be high, and when a team member leaves you need to absorb recruitment costs, you lose ramp time, and you face a coverage gap. With sales outsourcing this risk is on the provider, not you. They commit to providing you a certain level of support and they have to maintain an adequate team to do that. This is a benefit worth considering, especially when the cost of a bad hire at management level can be over £130,000.
Can You Combine In-House and Outsourced Sales? (The Hybrid Model)
Yes, you absolutely can and this often works very well. Many of our clients rely on our outsourced sales capacity to complement their existing in-house sales function. Often, the internal team focuses on closing, account management and building strategic relationships, while we handle top-of-funnel prospecting and pipeline generation.
The hybrid model works well when:
- Your in-house team is at capacity and can’t undertake any more outreach
- Your business is entering a new region or vertical and you want to test before committing to hiring internally
- You need support on a short-term increase in activity – perhaps because of a seasonal spike or a product launch
It’s worth noting that you don’t have to choose one model and stick with your decision forever. Many businesses use outsourced sales to flex their capacity as needed.
Which Really Drives ROI Faster?
When it comes to ROI, outsourced teams tend to come out on top. With faster deployment, lower all-in cost and reduced management overheads, you can get to positive ROI considerably faster than hiring in-house.
At E360 our clients see a 30-50% reduction in operational costs, compared to building an in-house SDR team. This is achieved largely by eliminating employer NI, pension, benefits, tech stack and the cost of management.
Example: If an in-house SDR costs you £65,000 all-in (using the figures cited above), equivalent outsourced capacity would cost around £35,000-£45,000. Plus, it comes without any recruitment risk, ramp period or management overheads.
What’s Right for Your Business?
The best choice for your business depends on your specifics – your stage, your budget, your runway and how quickly you need to see pipeline growth.
If you have the capital, time and internal infrastructure to build an in-house sales team with relatively little pressure, this could be the right choice for you. If, however, you need to see results in months rather than years, an outsourced sales model – or a hybrid approach – delivers faster, with less risk involved.
At E360 we help founders and business leaders in startups, scale-ups and enterprises build sales functions that work. Our Account Executives and Channel managers typically have over 10 years’ proven sales experience and we can help you get up and running in weeks, not months.
To learn more about how we could help you, get in touch today for a free consultation.