What are the key differences between sales and business development?


Business owners, managers and sales and marketing professionals often view sales and business development as one common system.

In many start-ups, a few key team members may be entirely responsible for, for example:

  • Finding and establishing contacts with potential buyers,
  • Research and understand your company’s target market,
  • Sales of their products and services,

However, as the company grows, it is less and less likely that the team will have the time (and in some cases the skills) to productively and proactively focus on all of these areas.

Hiring dedicated representatives to carry out various types of sales and business development activities in the long run can streamline a company’s growth and help it achieve financial success.

Research by Alexander Group, a revenue growth management consultant, shows that defining roles, such as in field sales, has a direct impact on its profitability and growth. If the role is properly defined, salespeople spend 39% of their time on value-added activities – compared to only 18% when they are in non-targeted or general positions.

If your company has reached or is approaching the point where expanding your team makes sense (or if you are starting or changing your career path in sales or marketing), it’s important to understand how sales and business development differ – both strategically and in the workplace.

In this article, we will clarify the meaning of the terms “sales” and “business development” to identify the key differences between them. We’ll also look at some typical roles in both areas and what to keep in mind when hiring new representatives for your department or company.

Table of contents

What is business development?

Although the meaning of business development (“business development” or “biz dev,” as it is sometimes abbreviated) can vary from company to company, it is generally defined as the creation of long-term value in an organization.

Increasing the value of a company can take place in many areas, such as sales and marketing, product development, production, management, accounting or human resources.

As business development activities focus on overall growth, they often aim to:

– Increase sales and revenues (often by identifying and exploiting new sales areas or opportunities),

– Expanding market reach (usually with the help of research, networking and strategic partnership development),

– Increasing profitability (for example, by increasing efficiency and reducing costs).

Depending on the size and goals of the organization, business development initiatives and processes can range from creating and executing high-level marketing plans to training to improve sales performance.

Here are some examples of activities that a company can use to achieve its development goals:

– Research the target audience to determine the best ways to attract more qualified potential customers,

– reaching out to customers, vendors and other business partners and building long-term, value-based relationships with them,

– Identifying new product user groups or introducing new solutions to existing or potential customers….

Regardless of where and how a company applies the method, the overarching goal of business development is to create, develop and sustain growth opportunities.

When it comes to sales, however, business development goals are often met when research, prospecting and relationship-building activities lead to an increase in the number of leads and, as a result, an increase in the number of closed sales.

What is sales?

A sale is technically defined as a transaction between two or more parties that involves the exchange of goods or services for money. However, sales as a process can involve a long chain of events.

While the sales process largely depends on the product and the nature of the company making the sale-business-to-business (b2b) sales can look very different from business-to-consumer (b2c)-it often involves:

– Making contact with potential customers to obtain information about a company’s goods or services,

– Conducting sales calls, presentations or demonstrations for interested potential customers to show how the company’s solution meets their needs or solves their problem,

– Converting prospects into customers by successfully guiding them through the various stages of the sales process (they can be one-time buyers, long-term customers, or both)….

Regardless of what your company’s process looks like, every transaction and every closed sales agreement(whether or not it includes the signing of a formal sales contract) represents a mutual understanding and agreement between buyer and seller:

– What is sold (including quantities),

– the price of the product sold (including any additional costs related to delivery, service fees, taxes or installation fees),

– how the sold product will arrive from the seller to the buyer (including details of pickup or shipping).

From a business development perspective, the more efficient your sales process is and the better you are at responding to, serving and satisfying customers, the faster and more sustainable your business will grow.

Business development versus sales: what are the differences?

Because business development and sales strategies often overlap, understanding where, when and how the two areas differ can be difficult. In fact, there is never a division between “business development and sales,” rather it is a collaborative process.

For example, business development and sales development have a lot in common when it comes to priorities such as:

– Acquiring new customers and increasing sales revenue,

– Establishing customer relationships and improving existing contacts,

– Expanding into (or competing in) untapped sales territories or marketing regions

This distinction can be particularly blurred in smaller companies, where a smaller workforce often means less defined roles and teams.

The easiest way to clarify the key differences between business development and sales is to divide these areas into smaller parts and compare them side by side.

It often covers a wide range of business development plans and projects (including those aimed directly at increasing sales opportunities).It plays a key role as one of the key ways to accelerate the company’s growth.
It focuses on achieving measurable growth over the long term.It focuses on achieving measurable sales results in the short term (i.e., each new sales period).
Roles, responsibilities and activities often revolve around strategic planning, market development and marketing research.Roles, responsibilities and activities typically revolve around working to understand customer needs, problems and the buying process, and applying sales techniques.
A key goal is to increase revenue for the company as a whole, often through value creation and exploitation.The main goal is to increase sales revenue, often by setting sales quotas, earnings targets and compensation plans.
The main goals are to establish and maintain contact with new and existing customers.The main goals include moving potential customers through the sales funnel and closing sales deals.
In the context of sales, the priority is to generate and transfer qualified leads to salespeople.In terms of business development, the priority is to follow up, convert and build trust with qualified leads.

The differences between sales and business development can be difficult to see in practice when one area overlaps with another in an organization.

However, it is important to understand that if your team or company is growing (or trying to grow), business development should take precedence in the sales process.

The overwhelming majority of companies (89.9% according to Gartner) use two or more sources of contact data to meet their sales development needs.

Once the business development team starts making contacts with the right buyers and passing on more qualified prospects to the sales staff, sales representatives will be able to do their jobs better, closing more sales and deals.

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