Software Sales

Is Software Sales Hard? 9 Things You Need To Know

Software sales can seem like a dream job to many. High compensation, lots of flexibility, and the fact that "software is eating the world." But it's not all roses. Tech sales, like any sales job, can be extremely hard at times.

Software sales might be hard if your product has no traction, your quota is unattainable, or your customers and industry are frightened by technological advancement. Most of the time though, you won’t have these three things working against you, and your tech sales job will be about as difficult as that of any other B2B sales representative. If it’s hard really depends on your target market and product.

Before diving into the potential difficulties of working in software sales, let’s go over the benefits that you reap. These benefits make even the hardest tech sales jobs worth it.

The Benefits of Working in Software Sales

Tech sales offers you the potential to make over 6 figures in an entry-level position. And if you are a solid sales rep and your product is in demand, the sky's the limit as you move up the ranks. Besides your income potential, here are some other benefits of working in SaaS sales.

High Commission Rates

Businesses that sell SaaS products benefit from the recurring revenue model. Each additional dollar of new revenue represents an annual subscription. This is significantly more valuable than the old days when a customer paid upfront for software, and then only had to pay for support. So, bringing on a new customer doesn’t just give the company a one-time influx of revenue. It gives the business a long-term paying customer. That means capturing the new ARR is of the utmost importance, and quality salespeople are highly valued.

Because of this, software companies often reward their sales reps with high commission rates for closing deals. A lot of the time, you can expect a commission of 10% of the annual recurring revenue of the deal. So, if you closed a $10,000 annual deal, you would earn $1,000.

A lot of companies will also offer kickers (or accelerators), which incentivize reps to surpass quota. A kicker is an increase in the commission rate that comes into effect when you pass the quota.

Let’s say your quota is $20k a quarter. Perhaps for all the deals, you close up to $20k you receive a 10% commission rate.

However, let’s say you close $30k. That extra $10k above your quota might earn you a commission of 20% thanks to an accelerator. And perhaps anything from $30k - $40k gets you 25% on that revenue closed — on and on. These kickers really elevate your earning potential.

Quick Upward Mobility 

The promotion path for software sales reps is pretty straightforward since most SaaS companies follow an assembly line team structure.

Usually, you start out as a business or sales development representative. Then, if you hit your quota enough months or quarters in a row, you get promoted to Account Executive (AE) Then, after a few years of serving as an AE, you have the opportunity to become a Sales Director, Sales Manager, or an Enterprise Account Executive.

Software companies want to promote their high-performing sales reps because they want them to work their biggest accounts and use their talents to do the most valuable actions.

So, if you hit your numbers, don’t expect to spend more than 1.5 years in a business development role. And if you do, ask for a promotion, or switch companies, because something’s awry there.

Work-Life Balance

Software companies want to hold onto their talent. They know their solution is difficult to understand and that onboarding new reps is a big-time commitment. It usually takes about 3-6 months for a new software sales rep to start performing on the same level as the one they replaced.

That means you have lots of vacation time, work-from-home privileges, and other perks that allow for a healthy work-life balance.

Most software sales companies offer at least 4 weeks of vacation, and many of them offer unlimited time off. Some, like SiteCompli, will even pay you to take time off. These days, many software companies are also letting their reps work entirely from their home.

The Hard Parts of Working in Tech Sales

Anything worth doing has its challenges. Keep in mind that many of the challenges can be erased by simply switching companies.

But, no matter what, if you want to enjoy the fruits of a software sales career, you have to suffer a few of the hard parts, such as the following:

Sometimes The Quotas Are Unreasonable

Unfortunately, some sales managers struggle to create realistic goals for their sales team. Sometimes they will set quotas that are just impossible to reach. Some people have been on SaaS sales teams that have quotas of 20 booked meetings a month, yet only 20% of the reps are hitting that number. That’s not okay. On average, 80% of a sales team should be hitting quota.

If you find that your manager is setting unrealistic quotas, it might be time to move to another company. Check out how the job board can help you find one that will treat you better.

There Might Be Low Demand For The Product

Some sales reps find themselves working for companies with huge budgets to invest heavily in a product that no one really wants. Product teams can get carried away and create new products that seem revolutionary to them and the founders, but that no target customer has ever mentioned a need for.

If that’s the case, and your sales numbers are suffering from a lack of market traction, get out and find something that sells. It’s no fun selling a product that you don’t believe in.

Your Solution Might Be Hard to Explain to Prospects

It might be easy to explain the benefits of your software product — less administrative work, more efficient processes, no more paperwork — but when you start going into the details of how the technology actually works and how your customers will integrate it into their day to day work-lives, things can get complicated.

Some buyers have a hard time wrapping their heads around tricky technical lingo like workflow automation or API. However, this isn’t such a bad thing. It forces you to work on your communication skills, which will help you improve as a salesperson.

Your Industry Might Be Averse To Change

Some industries are more open to technological advancement than others. Selling into the legal industry is more difficult than selling to marketing professionals. Real Estate businesses are notoriously averse to technology.

Of course, this level of technological aversion depends on to whom you are selling. If this matters to you, you can look for a job where you sell to tech-savvy individuals.

Longer Sales Cycles

If you are looking to make quick sales, tech sales might not be the place for you. B2B buyers of technology want to form relationships with their salespeople. They think of you as their trusted advisor.

And, due to the difficult nature of software implementation and the multitude of people it affects, buyers take their time when deciding whether or not to purchase a SaaS solution. Therefore, there will usually be more than one decision-maker involved in the process, and the sales cycle could easily be a month, even for solutions that cost just $2,000 a month.

No Pain No Gain

Tech sales is competitive and challenging, and it requires you to be strategic in your selling approach. You need to be persistent and consistent, and you must be intentional with how you guide sales conversations.

These difficulties make it a rewarding industry in which to grow your sales skills. After learning to sell something as complex as software, you should have no trouble selling anything else, whether it’s a business idea to a venture capitalist or a spoonful of spinach to your 5-year-old.

For further reading, check out 5 reasons to work in software sales.