Sales in India are not possible without a strong sales team. But how do you build a successful sales team in India?
Amazon, Walmart, and Apple will all target one of the world’s fastest-growing economies in 2021: India. This is not surprising. For, despite the recent hiccups in the Indian economy and also the Corona crisis, India still expects structural economic growth in the medium term. Moreover, India is rapidly digitizing, with the value of India’s e-commerce market estimated at around ‘200 billion by 2025.
In short, this is a good time to think about tapping into the Indian market. A professional sales team in India is essential for the success of your market entry. India is almost as big as Europe. Without local support in distribution, therefore, not all regions can be covered. Understanding the Indian market and its consumers requires many years of experience. With well-known tech companies, thoughtful action often ends with a withdrawal from the Indian market. An example of this is Uber. Uber recently had to sell its Indian UberEats subsidiary to India’s main competitor Zomato. This shows once again that in order to be successful as a company, one must know very well the needs of Indian consumers. So what is the best way to organize sales?
Traditional positioning of the sales team in India
A traditional sales team in India typically consists of several managers: national, regional, and local sales managers. At the top of the chain are the national sales managers, who define the sales strategy, maintain relationships with key customers and coordinate the entire sales process. The regional sales manager is responsible for coordination and negotiation with dealers, after-sales service, and inventory. Because India is so large, sales managers often divide the country into 4 regions: North, West, South, and East. The regional sales managers are responsible for one of these regions and appoint local managers within these regions who are responsible “on the ground”.
Look for a sales manager who knows the needs of the Indian customer well and knows how to market your product
If you are taking your first steps in the Indian market, you will not usually start with a large team. It is therefore critical that you work with a local manager in the start-up phase. Not only should it have a lot of experience with your specific product segment. He should also have a good understanding of how this product can be marketed in India. The fact that this manager may never have worked as a national sales manager doesn’t matter much. It is more important that this person finds Indian customers, builds up (online) sales, and knows how sales work in India. This person should also dare to take responsibility for himself rather than delegate tasks to others.
Selling in India without a national sales manager, is that recommended?
If you have found the right salesperson, do not immediately give this manager the title of national sales manager. Not even if he or she will lead your sales team in India at some point. In India, these titles are tied to a certain salary. For example, the national sales manager has an average income of more than €50,000 per year. You also expect him to be supported in his work by a team of regional and local managers. What you might want to wait for.
So what to do? Give this first-time seller the title of Business Development Manager. This position has exactly the same tasks in India as a national sales manager, but without the generous price tag. Nor is there any expectation of support from a structured sales organization. Your first husband or wife can gain experience in this way in order to eventually gain the position of national sales manager. This leaves money to expand the sales team in India at a leisurely pace.
Another option is to choose a company incubator. This is a low-threshold and cost-effective way to set up a sales office in India without having to set up your own office. You can rely fully on our existing structures and employees in India when exporting to India and the internal sales processes. With the incubator model, you don’t have any governance issues, compliance costs, audits, or capital requirements because it’s not a permanent office. All liabilities and responsibilities of the employees are held by M+V. The cost of this bet will be recorded in your company’s income statement in your home country. It is therefore the safest way to explore the Indian market and grow flexibly.
More information about M+V’s Business Incubator can be found here.