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5 challenges of adding a sales-led motion to your GTM strategy

So, you’ve got a product-led business but you’re looking to move upmarket? You’ll be looking to overlay a sales-led motion then, among some other important things. 

We’re here to tell you the main payment and billing challenges that you will need to address when opting for this particular (and popular) hybrid approach of adding a sales-led growth overlay to your product-led infrastructure.

1) The processes are very, very manual

If you’ve been a product-led business for some time, you’ll be used to the product itself driving your sales. Here’s where the sales-led growth approach can come across as time and resource-consuming, which is exactly why SLG businesses can quickly realize the challenges of scaling with this approach. 

Sales-led means introducing different ways for your customers to pay and other processes, like invoicing.

Why don’t we use invoicing as our example? This process includes: 

  • Issuing the invoice
  • Chasing the invoice
  • Payment of the invoice
  • Managing the invoice (eg. any changes that might happen over its lifecycle)

All of that = manual. And the thing about manual processes? Not only are they time-consuming and resource-draining, but they are also subject to human error. This can give you a lot more work in the long run. But that’s if you aren’t careful.

The good news: There are solutions out there that can help you do all that, and take a load off your plate. 

2) The potential for a lot of extra admin 

The combination of PLG and SLG comes with the possibility of big moves in business growth, but also the possibility of a lot of extra admin for your teams. Especially your finance team. (Sorry, folks). 

You’ve got to consider every location and territory you’re selling into and ideally set up bank accounts, payment options, and currencies to suit each and every one of them. For example, a customer may choose to pay an invoice by credit card, bank transfer, or in many cases, by check. It’s on you to provide their preferred payment method and work with it. 

One of the differences between product-led growth and sales-led growth is the type of customer you’ll attract, and the annual contract values (ACV) of each sale. Typically, SLG transactions are of a higher value and more likely to be paid via wire transfer instead of a credit card. Where credit cards are global in nature (as long as you enable Visa and Mastercard), wire transfers require local bank accounts and currencies to retain that global reach. 

Long story short: That’s a lot of payment admin to manage and track, creating a problem of fragmented data and overly complex reporting. But we’ll talk more about that further down in point #5, because it’s a big one.

3) Payment reconciliation will be your responsibility

Reconciliation is the process of comparing internal and external records to make sure that each and every payment has been made. But without auto-reconciliations, things can get complicated quickly with your sales-assisted wins.

Let’s look at this process step-by-step: 

  1. You send an invoice from accounting software like Xero
  2. Your customer makes the payment directly to you via wire transfer
  3. You then (without an automated system in place) need to manually company bank statements, mark them as paid
  4. You move on to the next statement and repeat

Yep, that’s right - another big job for your finance team. 

This also proves a real problem for scaling your business. As the number of invoices increases, so does the number of bank accounts and currencies being added, meaning the whole - already time-consuming - process gets more and more complex. 

4) Global sales tax and other laws are on you

Global sales tax rules and regulations: just another thing to add to your plate. The responsibility to be compliant is all yours, which means if you get it wrong as you expand internationally, you risk penalties and fines from local tax authorities. (Penalties and fines that are especially big when you’re dealing with the larger ACV accounts that come with the SLG approach).

Once you’ve managed to register everywhere you’re liable, the process for your finance team should look a little something like this:

  • Invoice paid
  • Funds received
  • Tax remittance to the relevant authority
  • Credit their balance 

And you want to know what else? In some circumstances, you may even require a local entity or local tax representative to deal with your tax and invoicing. Norway, Switzerland, Japan, South Africa, Australia, and South Korea are just a few examples.

5) Your data will be split

Reporting is so important to understanding your business and managing your cash flow, as well as developing and optimizing your product to get in maximum revenue. But when you’re bringing in a second growth strategy, what does that do to your customer data? 

Well, it splits it. Ideally, you want your data collection to be unified and real-time for it to be efficient and accurate. Except, by overlaying a sales-led approach, you’re adding in another set of tools and processes, meaning additional sources of data. 

This is because you use different platforms to initiate checkout-based payments than invoicing payments. For example, you use Stripe to create a checkout, but Xero to create an invoice. So, one won’t be able to see the revenue generated through the other. 

The solution? A centralized metric or BI tool that can unify your data into a single source of truth. But with that can come hard work, particularly when more currencies and bank accounts are being introduced as you scale globally.

How do you make the hybrid motion work?

Okay, we know - the hybrid PLG and SLG motion may not be the easiest, but the benefits of applying both in a bid for ultimate business growth = unrivaled. 

Here’s a run-through of what you need to implement a hybrid motion successfully:

Requirements for an effective PLG and SLG hybrid approach:

  • Scalable invoicing creation and delivery
  • A solid banking infrastructure (including merchant of record
  • Reconciliation that scales (eg. auto-reconciliation)
  • Single source of reliable, real-time, revenue data
  • Removal of compliance burdens

But how to meet these requirements?

Implementing these processes efficiently comes down to your payments infrastructure. If you’re clever about it, adding a sales-led motion to your go-to-market strategy doesn’t have to be full of manual processes that take up a lot of your team’s time at all. 

You can opt for a piecemeal approach or a traditional merchant of record. Or you can take even more off your plate with a complete payment and billing infrastructure solution - and here’s where Paddle comes in. Our all-in-one platform helps you sell better, faster, simpler, and safer – we handle everything from product-led checkouts to enterprise invoicing, giving hybrid sellers a single source of truth when it comes to revenue data

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