The aging and greying of the equipment finance and lending industry has been a systemic concern to industry CEOs charged with growth for many years now. The solution to the greying problem has been rediscovered. This solution can also miraculously solve revenue and volume shortfalls and drive down SG&A costs. Ironically, this miracle solution was right in front of our eyes. It existed 20 years ago, but somewhere along the way, through multiple mergers and acquisitions and through short-term pressure to deliver immediate results, the formula was lost and forgotten. The solution to the sales volume and greying problem is called “Inside Sales.”
Ironically, inside sales was once a key driver of talent that fueled growth in the equipment finance and leasing market. In the 1980s and 1990s, firms like Master Lease, Copelco, Lease America, and TransLease mastered the skill of hiring young, inexperienced sales talent, then training and developing them into stars through inside sales efforts. These firms brought in scores of green talent who arrived and turned the survivors into industry professionals. Today these professionals are running leading companies and managing large sales forces. Even more interesting is the number of industry professionals who started in a call center and have become some of the markets’ most successful and interesting entrepreneurs. In Southern California alone, talent spinoffs from two firms, Balboa Capital and Amplicon/Cal First represent now dozens of successful lending businesses that employ thousands locally.
What happened then? Somewhere along the way trends shifted and the Inside sales talent pool was promoted to conventional field sales, program management and national account sales roles. The sales talent pool in the industry dwindled, and since companies in need of growth did not have the time to invest in young talent, the industry aged. Acquisitions turned many successful inside sales teams into cost savings synergies as they slowly closed many of the centers. The incubator of future talent was unplugged.
On top of this, the way people buy products and services is changing right in front of our eyes. Inside sales is on the rise in virtually every product and service sales strategy we see. Giants like Microsoft, Amazon, Medtronic and ADP are all effectively utilizing inside sales.
Like a case of Déjà vu, the lending markets have also been quietly embracing this shift and returning to what worked years ago. New school is really old school when it comes to call centers. In equipment finance and in the emerging Fintech/Business Lender category, billions of dollars of new volume are now being generated every year and serviced through successful inside sales models. This is coming from both the established well-known names in equipment lending as well as the new crop of Fintech Business Lenders like OnDeck Capital, Swift Capital and National Funding. These new lenders have arrived on the scene, taking market share from traditional equipment finance players partly through their ability to raise a sales army virtually overnight, and without the hiring constraints of requiring lending industry experience and a client book of business.
What does this resurgence in inside sales mean to today’s bank and independent lenders? What should companies be doing to stay competitive in the race for cost-effective sales originations and growth? We will examine these questions in more detail and discuss some practical steps to consider.
Why the Surge?
According to experts, inside sales as a category is surging across all products and services as the preferred sales channel, outpacing hiring of field sales by over 300 percent. Face-to-face selling is on the decline and inside sales is booming. The convergence of outside sales and inside sales is further blurring the lines as a majority of a sales person’s time is spent in an office near a computer and phone and not in face-to-face selling situations. Are field sales people really “in the field” or truly doing inside sales work remotely?
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