Decrypting most effective B2B sales strategy for trading: Enterprise vs SMB
Many people think that enterprise sales are just bigger versions of SMB sales. In reality, both are different from one another. B2B sales are very complex as they require a lot of time for conversions. It must be noted that by dividing B2B sales into its sub parts we get enterprise sales and SMB sales.
Characteristics, pain points and priorities of these two segments of B2B sales are completely different. Thus, they both require different methods to solve the paint points. In this blog, we will understand the basics of enterprise and SMBs along with undertaking the basic differences between them for carrying out B2B sales.
Basic definition of SMBs and Enterprises
SMBs can be considered as those businesses which have a smaller head count in addition to annual revenue generated. On the other hand, enterprises are large-scale companies having revenue in billions and thousands of employees.
It is a procedure involving the sales of products and services of a multinational corporation. It is complex and involves large contracts, long sales cycles, numerous decision makers and comes with a higher risk.
In this, the small business put money into the transactional sales that have a lower risk and have higher performance with sales and marketing backing. Also, these businesses have fewer number of decision makers, reducing the time of completing the entire sales process.
SMB Selling Vs Enterprise Selling
SMBs and enterprises have different business priorities. SMBs go for short-term goals that can be completed within a short span of time. Also, the short-term goals require shorter timelines between decision making to project implementation.
Contrary to this, enterprises go for long-term goals. These goals involve gaining market share, building brand or global expansion. Thus, enterprises look for projects that can be achieved over a period of time. These goals prove to be a plus point for the enterprise in the long run.
For the SMBs across the globe, business growth is one of the biggest hurdles in every financial year. Also, these small-scale companies look out for ways to increase productivity. They have to keep improving their workflow for getting better business results.
Enterprises face complete;y different types of challenges. They have to cope up with problems such as lengthy sales cycles, low ROI on IT projects and accountability. In addition, the enterprises have internal hurdles as well, such as poor data reporting practices, declining profit margins and unintegrated distribution systems.
B2B sales associated with SMBs require lesser time for execution. Decisions are less complex and thus consume less time. On the other hand, the buying journey for B2B sales of enterprises depends on external factors as well. In general, these are long, non-linear and can last consecutive business cycles.
Decision Makers (Management body)
For SMBs, these are business owners who have complete authority over all the decisions. Their monopoly helps them in making decisions faster and better. Decision makers of enterprises contrast with that of SMBs; multiple stakeholders are required to sign a deal. Thus, any form of disapproval can lead to delay or cancellation of business deals. SMBs have an advantage over enterprises when it comes to the B2B sales decisions.
Which should be considered - SMB sales or enterprise sales?
Enterprise sales require a lot of time and patience as they can last for a long duration of time. They bring benefits but consume a lot of energy and time of sales team. Many times, prospective individuals at the last stage of the sales funnel will say ’NO’ and walk off.
SMBs have the capability to handle this kind of scenario and their audience is small and wants services on tight budgets. In the 21st century, it is a common strategy to opt for both forms of B2B sales. Separate teams can be formed to handle both the segments effectively. The type of B2B sales majorly depends on the type of product.
Additional things to consider for implementing B2B sales
What is the in-house sales team equipped for?
It should be noted that the businesses must be clear whether they have a sales manager that can close the deal quickly to build a customer base or not. And a major focus must be on the strategy - prolonged, end-to-end, direct or channel sales approach. Everything must be clear between the sales manager and his/ her team about which strategy is implemented.
What is the capital need?
In this case, enterprise sales will not be considered suitable. Mainly due to the fact that they consume a lot of time. For achieving capital-related goals, short-terms goals are required.
Enterprise and SMB sales are not just based on the size of the company or the project. Yet both the strategies can be used by the same company for handling different projects. Managing team must be clear about which B2B sales strategy needs to be appointed as per the requirements of the project.