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Why Do Some LSPs Seem to Grow More Easily Than Others?
Posted by Hélène Pielmeier on November 14, 2018  in the following blogs: Best Practices, Translation and Localization
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The market for outsourced language services and supporting technology grew 7.99% to US$46.52 billion from $43.08 between 2017 and 2018. When CSA Research analyzed 531 responses to our annual global market survey, we computed that 64% of respondents experienced an increase in revenue. However, all providers don’t share the same experience. 

To identify patterns to help predict the odds of sales success, we contrasted a series of characteristics tied to company set-up and revenue sources against whether LSPs reported that their revenue grew, stagnated, or regressed between 2016 and 2017. While these correlations are not necessarily causative, the observations we notice provide fodder for thought.

Let’s take the example of the number of salespeople in charge of new business development. We observed an average of 1.7 salespeople at those that experienced sales losses against 4 or more for those that remained stable or grew. The larger the sales team, the more likely you are to bring in new revenue. However, hiring more resources is no guarantee of success as numbers show minimal differences between those LSPs that stagnated and those that grew. Decisions to invest in staffing vary based on strategy, company maturity, and funds available. Elements such as sales and marketing focus and technique matter more than staffing levels. Well-trained small teams can succeed at growing an organization just as well as larger ones.

Through the findings of an upcoming report on growth factors, CSA Research recommends:

  • Plan your growth. Sustained sales success is not the result of luck but of planned and continual investment in the growth function of your organization. This involves adding staffing and infrastructure, proactively selling to new clients, and up-selling existing accounts.

  • Devote extra attention to developing your growth team. Hire and train enough staff to build a strong lead pipeline to deliver new work. LSPs with an informal or underperforming sales and marketing function often end up with excess capacity. Those who wait too long to develop the function are likely to struggle to turn around as they experience lags to recruit the right talent and deal with the long sales cycles common with many target markets.

  • Quality is better than quantity. Don’t mistake investment for guaranteed success. A well-spent modest budget dedicated to quality marketing and sales activities is better than a big budget spent on activities with little return on investment (ROI).

  • Diversify your operations. Relying on top clients, a specific geography, or a service stream is risky. To increase the odds of success and to negate the damages of changes that affect your primary business, diligently add new clients, new geographies, and offerings. Yet be careful not to stretch your organization so thin you can’t support grand plans.
As you develop your growth strategy and seek to benchmark the state of your sales organization, stay tuned for the upcoming growth factor report – which analyzes 11 similar correlations of revenue to a variety of business characteristics and revenue sources – and another upcoming report on characteristics of the fastest-growing LSPs. Also, leverage resources in the CSA Research “Sales Cookbook,” “data visualizations,” and “data highlights” series.


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