Business development versus sales: What are the differences?
Key sales and business development roles
How to hire sales and business development reps
Business owners, managers and sales and marketing professionals frequently view sales and business development as a single, umbrella-like system.
In many newer businesses and startups, for example, a few key team members may be entirely responsible for:
Researching and understanding their company’s target market
Finding and connecting with potential buyers
Selling their products and services
As your business grows, however, your team is less likely to have the time (and in some cases, the skills) to focus productively and proactively in all of these areas.
Hiring dedicated reps to carry out distinct types of sales and business development activities can streamline your company’s growth and help boost your financial success over the long term.
Research from the Alexander Group of revenue growth management consultants shows that defining field selling roles, for example, has a direct impact on profitability and growth. When there’s proper role definition, salespeople spend 39% of their time on value-added activities – as opposed to just 18% when they occupy unfocused or generalist roles.
If your company has reached or is nearing the point when expanding your team makes sense (or if you’re launching or shifting your sales or marketing career trajectory), it’s important to understand how sales and business development differ – both strategically and in the workplace.
In this article, we’ll unpack the meaning of the terms “sales” and “business development” so we can identify the key differences between them. We’ll also look at some common roles in both areas and what you should keep in mind when hiring new reps for your department or business.
What is business development?
Although the meaning of business development (or “biz dev”, as it’s sometimes shortened to) may vary from one company to the next, it’s generally defined as the creation of long-term value within an organization.
Increasing business value can happen across a number of areas, including sales and marketing, product development, manufacturing, management, accounting or human resources.
Because they focus on overall growth, business development activities are frequently aimed at:
Boosting sales and revenues (often by identifying and capitalizing on new sales areas or opportunities)
Extending market reach (usually with the help of research, networking and the development of strategic partnerships)
Increasing profitability (through efficiency and cost-cutting measures, for example)
Depending on the size and goals of your organization, the business development initiatives and processes you adopt may range from creating and executing high-level marketing plans to engaging in nuts-and-bolts training to improve sales performance.
Here are some examples of activities a business might use to further its development aims:
Researching a targeted audience to determine the best ways to attract more qualified sales leads
Reaching out and building long-term, value-driven relationships with clients, vendors and other business partners
Identifying new product user groups or introducing new solutions to existing or prospective customers
No matter where or how your company applies it, the overriding focus of business development is to create, advance and sustain growth opportunities.
When it comes to sales specifically, however, you’ll often see business development objectives being met when researching, prospecting and relationship-building activities lead to more targeted leads in the pipeline – and an increase in closed sales deals as a result.
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. Sales as a process, however, may involve a lengthy chain of events.
Although the sales process is largely dependent on the product and the nature of the business doing the selling – business-to-business (b2b) sales can look quite different from business-to-consumer (b2c) selling – it often includes:
Establishing contact with targeted leads to provide information about a company’s goods or services
Doing sales calls, demos or presentations for interested prospects to show how a company’s solution meets their needs or fixes their problem
Converting prospects into customers by successfully moving them through the various sales pipeline stages (these may be one-time buyers, long-term clients or both)
Whatever your company’s process looks like, every transaction and every sales deal that closes (whether or not it includes the signing of an official sales contract) represents a mutual understanding and agreement between buyer and seller around:
What’s being sold (including the quantity)
The price it’s being sold for (including any additional costs for delivery arrangements, service charges, taxes or installation fees)
How the product being sold will make its way from seller to buyer (including pick-up or shipping details)
In business development terms, the more efficient your sales process and the better you get at responding to, servicing and satisfying your customers, the faster and more sustainably your business is likely to grow.
Business development versus sales: What are the differences?
Because business development and sales strategies frequently overlap, understanding where, when and how these two areas differ can be tricky. It’s never really “business development vs. sales”, instead being a very collaborative process.
For example, business development and sales development share a lot of common ground when it comes to priorities like:
Finding new customers and increasing sales revenue
Establishing client relationships and improving existing connections
Expanding into (or competing in) untapped sales territories or marketing regions
The distinction can be especially fuzzy in smaller companies where less staff often means less defined roles and teams.
The easiest way to clarify the key differences between business development versus sales is to break these areas down and compare them side-by-side.
The differences between sales and business development activities can be tough to see in action when one area overlays the other within an organization.
It’s important to understand, however, that if your team or business is growing (or trying to grow), business development should take priority within the sales process.
The reason for this is simple: before company growth can occur in the form of increased sales, there must be a well-developed plan for generating more sales opportunities in the form of well-researched leads.
The overwhelming majority of companies, in fact (89.9%, according to Gartner), rely on two or more sources of contact data to fulfill their sales development needs.
Once your business development team starts connecting with the right audience and handing off more qualified prospects to sales personnel, your sales reps can do a better job closing out more sales transactions and deals.
Key sales and business development roles
To get a better idea of how the differences between business development and sales play out in the real world, let’s take a look at some of the most common types of sales jobs and business development job titles.
Sales reps sell their company’s products and services by informing and educating prospects in person, online or by phone. This sometimes involves delivering customized demos, training sessions or sales presentations – and often extends to the support of existing customers as well.
B2B sales professionals may work as inside (aka remote) sales reps or outside (aka in-person) sales reps or consultants. B2C sales reps might also work as retail store associates or telemarketers.
Sales development representative (SDR)
A sales development rep generates sales leads, usually with the goal of passing them on to sales representatives. They may contact inbound leads (from their company’s website, for example) or do their own prospecting (usually via cold calling or cold emailing) to find promising connections.
Because they’re a B2C or B2B sales development representative (meaning they’re responsible for the development of new buyer relationships) SDRs qualify each new lead by using deep product knowledge to determine if there’s a good fit, in regards to needs, timing and budget.
Sales managers help teams of sales representatives (or SDRs) reach their sales quotas or goals. They offer support on both a practical level – by providing sales training, performance evaluations and up-to-date product information, for example – and by keeping reps motivated during lead generation and selling.
Sales managers are often responsible for staffing their own departments and may work with business developers to strategize around long-term sales goals and initiatives.
Business development representative (BDR)
Business development reps may also generate qualified new business leads, but they frequently take a broader approach to finding new customers.
They might, for example:
Conduct market or customer research within a specified region or sales territory
Cultivate long-term relationships with prospects by providing practical or insightful problem-solving advice
Introduce products or solutions that will benefit new and prospective customers
BDRs also sometimes arrange meetings between prospects and their company’s sales or account executives.
When this role is associated with business development it will sometimes be called an “account development manager”. These account managers work with the lead generation teams to identify ideal prospects and then be the main point of contact when they convert to customers.
Account managers develop relationships with clients, often for B2B businesses that have ongoing relationships with customers, helping them to make the most out of a company’s products, solutions and services.
Business development manager
Business development managers are responsible for promoting overall business growth by generating new sales revenue.
They too create new leads (by nurturing key customer relationships and developing new ones), but they may also work to increase brand exposure by:
Researching and tracking new markets or emerging trends
Networking with potential customers
Arranging strategic partnerships with complementary businesses
As they work on or oversee sales growth plans, business development managers are often responsible for projecting, forecasting and measuring sales and revenue results.
Director of business development
Directors of business development are essentially the point people for growth within an organization and are responsible for ensuring revenues consistently increase. They will only get to this spot after years of experience in business development.
They typically spearhead and oversee:
Sales and marketing teams
Brand awareness projects
Sales and relationship-building initiatives
Because business development directors focus on identifying and leveraging brand-new sales markets and expansion opportunities, they frequently work with other senior leaders to strategize around accelerating their company’s financial success.
Now that you have a better idea of which growth gaps your business may need to fill, let’s take a look at what you should keep in mind when hiring new company reps.
How to hire sales and business development reps
Sales, marketing, business development, lead generation: with so many different roles – and so much potential for overlap – it’s easy to get confused about where you should start when building a sales and business development team.
The main thing to keep in mind is that business development professionals typically handle top-of-funnel activities, while sales personnel usually operate further along in the sales cycle where they focus on closing.
So, the first thing you should do is take stock of how your business is performing at either end of this sales process:
Are you closing deals fairly consistently? If your sales team has grown into a well-oiled selling machine, but they’re having trouble keeping their pipelines filled with qualified leads, it may be time to invest in a separate set of business (or sales) development reps.
Are you finding plenty of solid sales leads? If you’ve nailed the research and prospecting process, but your sales department is having trouble following up on all the qualified leads you’re generating, it may be time to hire some additional sales reps.
Since sales and business development reps frequently work hand-in-hand to achieve growth objectives, you should have a plan for finding the right people for your team.
You might, for example, choose to focus on candidates whose experience shows they function well in a collaborative setting. You could also ask existing team members to take part in group interviews and offer their feedback.
As you prepare your plan, this brief rundown of key attributes will help you think about what you should look for when hiring sales and business development talent.
What to look for in sales reps
Because sales reps connect directly with prospective buyers, they need a strong desire to resolve customer pain points and an equally strong belief in the value of the solution they’re selling.
You can identify promising reps to sell your product or service by looking for:
Excellent communication skills
A balance of confidence and approachability
Demonstrated time management and organizational skills
Remember that selling and closing techniques can be acquired. It’s more important that the candidate you’re considering demonstrates an eagerness to learn and an authentic drive to problem-solve and help clients.
You may find it easier to attract and retain top talent if you offer ongoing sales training alongside a competitive sales compensation plan that rewards reps for hard work and account growth.
What to look for in business (and sales) development reps
Because company growth can take time, business development reps need to be able to think long term and carry out duties that don’t always yield immediate results.
You can identify promising reps to increase your sales, revenue or customer base by looking for:
Sales experience or an aptitude for networking and social media
Knowledge of buyer personas, customer research or lead qualification
An ability to take the initiative
Ideally, you should look to hire people who understand the value of relationship-building and who are excited to learn all they can about your solution and the benefits it offers.
You may find it easier to attract and retain high-level talent if you offer a competitive salary, a supportive work environment and ongoing communication skills training.
Depending on your organization, the differences between sales and business development could mark the divide between little-picture-vs-big-picture thinking – or they might disappear entirely where growth initiatives overlap.
When it comes to the role of sales in growing your business, however, the main distinction between these two areas should now be clear: whereas business development professionals focus on creating as many targeted leads as possible, sales professionals focus on converting as many of those leads as they can.
As you prepare to make the most of your sales and “biz dev” efforts, some next steps might include:
Finding out what your competitors are up to (if you haven’t kept tabs on them lately)
Updating your sales and marketing strategy (if it’s been a while since you last reviewed your plan)