To grow your sales in Europe: should you hire a rep to generate sales or generate sales before you hire?
When I talk to small Australian businesses about the development of their sales in Europe, there is one subject that often comes up it is hiring staff in Europe. Either they mention to me that they hired a sales rep in Europe and it did not work, it costed us a fortune and did not bring any sales. Or in some cases, they sent one of their staffs to relocate in Europe and it did not prove to work out. What often happens as well, is that are not sure if above the two above mentioned options: sending a staff or hiring someone?
In my views, small businesses unless they are turning over several millions dollars or have significant financial backing should neither hire nor relocate one of their staff in the first instance! The first phase is to get to this several million turnover before having staff over in Europe.
There are several reasons for that:
Minimize the financial risk for your business
Hiring staff locally means more financial risk for your business, so you need to minimize that risk as much as you can as a small business. That financial risk is a mix of cost of recruitment, risk of recruiting the wrong person, legal cost of dismissing a European employee, and so on. Minimising that risk actually means that you must have validated your market potential before you appoint anyone. It means that you already have some sales going, proving that your product or service is suitable for that market. You have some growth potential clearly identify that make it a no brainer for you hire locally.
Attract the best person for the job
One of the best way to attract the best person for a small business, is to be successful in European! Remember you, as an Australian business, want to recruit a European. It means the potential candidate needs to be very comfortable that you offer really good sales prospects for them. You need to demonstrate to them that it is a great opportunity for them. You need to show them existing sales and growth potential. In reality, as you develop the sales in a specific industry, you become visible to your market and you are in a position to attract candidates that will come to you. There are opportunities to become visible to talents looking at a career move, that are currently working for a distributor, a competitor or an influencer in your ecosystem.
Your market knowledge is your safety net in Europe
There is one factor, which I keep repeating to my clients: the more you know about your market in Europe, the safer you are. What I mean by that is as a small business you can’t rely solely on one person to know everything about your market in Europe. You can’t have only one person that has direct contact with your European distributors. You can’t only have one person that knows your end-users. As a small business, you need to know your major clients and partners at any point in time. It’s a safety net for you, because if your new recruit does not work out, you can pick the work at any point in time. If anything wrong is happening, your distributor or client can pick up the phone and let you know.
That is why we always work on being very transparent on what we are doing in Europe for our Australian clients. We also spend a lot of effort explaining the soft information about the market, or the “insider“ information as we call it. It means talking about the dynamics in this market, and about the people themselves, who’s motivate who’s not for example. Any important detail that we think our clients need to know.
The way we do this while working with several clients of ours: while doing business developments we usually take a client’s team member with us on several visits per year to Europe: it can be the CEO, the business development manager or a technical person. We give strict reporting about who we contact, their contact details and their feedback. We embrace whatever reporting tool or customer relationship management tool our client is using.