Here’s What you Need to Know
Getting ready to expand into a new region often starts with hiring your first overseas sales manager. This is because a sales manager is best-placed to scout for leads and develop a new market, a very common goal when expanding into a new area. Once recruited, this sales manager will usually be tasked with opening up opportunities in the new location, networking, reaching out to local partners, and generally building out a presence in that region.
Based on their individual success, your organization will then decide on next steps, from hiring more staff in that region such as Customer Success or Marketing roles, or scaling up to a larger sales team to handle an influx of leads. This strategic hire is not the same as the process of hiring a new sales manager in your existing location, and so needs its own unique plan. Let’s look at what you should consider before you start.
Sales Manager or a Country Manager?
If you are a company with a standard product that doesn’t change by country, you may choose to hire a pure salesperson whose role it is just to sell. However, if your product is being adjusted for the location, you may need someone who can take more of a managerial role – a country manager. This person would take charge of a team, including Customer Success, Marketing, additional Sales support, and more.
They could be tasked with creating a new client profile, handling operational requirements in-country, working with the local authority to get permissions for services, or taking advantage of speaking opportunities, to name just a few examples.
As a country manager works in a multi-disciplinary role, they are likely to have a higher base salary and additional compensation that is tied to the success of the region. In contrast, a sales manager would be a better hire when the administration and operation of the new region is being taken care of centrally, and the candidate will be focused on developing relationships, partnerships, and sales opportunities.
Whichever is the right fit, you’re looking for a very unique personality type, a real self-starter. All successful salespeople are great with people, good at networking and building relationships, but a new location requires something above and beyond. This person will be working alone, figuring out the new landscape for the business, and often with only a rough plan to follow. Look for a candidate who is innovative, entrepreneurial, and resilient, and able to come up with new ideas and test them out to see what works and what doesn’t.
Do You Need a New Plan for Compensation and Benefits?
Firstly, it’s important to do some research into local compensation and benefits, to make sure that your proposal works in that country. For example, some countries may offer certain health insurance or social security benefits as standard, while others do not.
You may have a standard compensation package for your local sales managers, but that’s not always a smart process for your first overseas sales manager. Think about the risk that is involved when starting out in a new region. If your sales managers are used to a compensation plan where they are given double On Target Earnings (OTE) based on a specific target and a percentage of the deals they close, this won’t be possible from day one in a new region.
Your candidate will likely be coming from another role where they are already getting a full base salary and commission, and will need an incentive to start again from scratch. Because of this, many organizations will provide a guaranteed commission for 3-6 months while the sales manager ramps up in a new location or role. You may also want to consider an overperformance bonus, to incentivize the candidate to push for the best possible results in that new location.
Initial research is crucial here. Your candidate is taking a big risk taking on the sales manager role in a brand new region, and will want some proof that there is a viable business opportunity in the country of choice. They will be tasked with validating that business opportunity on behalf of the company and seeing it through to customer relationships, but it can be helpful to show the candidate that you already have leads in place, or you have looked into the market demand ahead of time.
Finding the Perfect Overseas Sales Manager in Your Location
There are a few ways to find the right candidate. Firstly, think about where they need to be based. Is there a specific city that you want the sales manager based in, or is it enough for them to be in the same country, or even time-zone? Is the role based on them having a specific cultural understanding of the new region, and will they need to work closely in person with other stakeholders?
Sales can be the kind of job where people work alone and travel when necessary, so it may be fine for a candidate to live in a remote location. If on the other hand you want this person to be meeting with potential clients every day, or part of their role is to be assessing the viability of a specific city for further expansion, you may prefer to hire in a predetermined place.
For example, part of the role of a first overseas sales manager might need to see whether the capital city would be a great place for a larger sales presence, or if there are other regional economies to consider. Think about the US, where Washington DC could be a much poorer choice for a sales office than California, for example.
Once you’re ready to scout for candidates, there are a number of ways to find the right person, such as speaking to your investors for their insight, networking with other people in the business, and getting personal recommendations from colleagues and friends.
However, it may well be worth using a specialist recruitment agency. After all, this is a strategic hire, and the success of this new location will heavily depend on the work that this candidate does. If your expansion into the region is going to fail, you want it to be because the region isn’t a good fit or because the customers aren’t there, not because your sales manager was a bad hire.
EoR: An Employment Model That Makes Your First Overseas Sales Manager Hire Simple
At the first stages of expanding into a new location, you’re often going in blind. You don’t know if the sales manager will find a huge gap in the market and be extremely successful, triggering the need to grow their team quickly, whether they will need just a few more people to support their efforts in slow and steady growth, or whether they will come up empty and the expansion will be a distant memory a year from now. This means that the effort and resources necessary to set up a local entity in this country to hire the sales manager can be premature.
At the early stages, an Employer of Record (EoR) agreement can be a perfect fit. You set up a relationship with a local in-country partner who hires the new sales manager on your behalf, handling all the administration and local requirements, including payroll and benefits. After you’ve assessed the viability of your expansion, you can choose the right time to move to a Payroll model by setting up a local entity in this location, which might be down to a critical mass of employees in that region, a certain number of sales, or just the gut feeling that it’s time to set down some roots.
If on the other hand, the new region doesn’t seem viable, you sidestep the administration of setting up and closing a local entity, and can simply end your relationship with the local partner, at no risk.
Papaya Global Knows Overseas Expansion
At Papaya Global, we have deep knowledge of both sides of the coin. We provide a platform that both facilitates the EoR (or Global PEO model for customers looking to assess viability in a new location and can manage global payroll when the time comes to set up a local entity.
If you’re looking to expand into a new region, and want to make sure your first strategic hire works for your needs, let’s talk.