"THE CREDENTIAL"
December 2013

Seller vs. Seller-Doer

  Whether you are a large, medium or small A/E/C firm, creating a successful business model is fundamental, especially as we continue recovering from the devastating recession.  With 2013 drawing quickly to a close, in boardrooms across the country the phrase "Seller vs. Seller-Doer" is gaining traction when evaluating business development strategy.  Guest Author Karen Compton, CPSM, Principal of A3KConsulting and Founder of Industry Speaks™, shares an essential calculation you can use to work through "Seller vs. Seller-Doer" challenges and consider new paths to improve your successful business development. 


"I need to find a business development person."  I hear that statement often, and my answer often is "Are you sure?"  The truth is most small firms (i.e., less that 50 in an engineering and architectural firm) do not benefit from a dedicated business development professional.  The reason is two-fold.  In a smaller firm, clients expect that business development/sales functions will be led by the principal.  At that size, a key function of a firm ownership is getting new business.  But, many firm owners dislike business development and would rather relegate it to someone else.  Which brings me to my second point:  it is often financially unfeasible to have a dedicated business development position in a small firm since it is often pure overhead.

In our industry, sales and commission structures don't work.  Business development professionals play a role in "opening the door" to new clients, relationships and opportunities, but they are often not responsible for closing deals, nor are they responsible for the delivery of architecture or engineering solutions.  As a result, to tie their compensation to such metrics is unreasonable and often unsuccessful.  What is the option?  Consider a Seller-Doer.

A Seller-Doer is just that:  an individual that both sells the work and it responsible for its delivery to the client.  The individual is often a professional (i.e., architect, engineer, construction manager) responsible for identifying and developing new work and then performing some level of the work.  He or she could be a Project Executive, Project Director or full design-delivery manager.  In any case, a portion of their salary is billable back to the project(s) which they identify and secure.  As a result, the impact to a firm's overhead rate may be as much as 50% less (depending upon the billability of the individual).  Let's look at the numbers:

Assuming a salary of $100,000 a year plus benefits at 35%, $100,000 in proposal costs and overhead including computers and office space of $35,000, the total annual cost is $270,000.  If we assume a 10% gross profit, the business development professional would need to secure $2.7M in new work just to cover their costs.  A Seller-Doer (35% billable) reduces the amount of fee required to cover their costs by $945K. 

Review your numbers and then decide:  Seller, Seller-Doer or Do-It-Yourself. 



Have you done the math as Karen has suggested?  If you find you are either a "Seller-Doer" with staff or a Do-It-Yourselfer, it is essential to review all of your time stealing demands sabotaging potential billable hours.  One easy time and money saving solution is outsourcing your credentials management.  If you eliminate the labor cost and overhead expenses associated with time spent researching, documenting and reporting requirements, you will gain billable project hours.  For more information and answers to this secure credentials management solution, visit www.AECredentialing.com.

Housekeeping Note:  If your address, phone number  or email
address has changed please notify your credentials agencies. 

Contact Details: 

LS Credentialing Services, WBE Certified, P.O. Box 91, Olathe, KS 66051

Info@AECredentialing.com

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