What Is Business Development and Is It Sales?

By Indeed Editorial Team

Updated 14 October 2022 | Published 30 June 2021

Updated 14 October 2022

Published 30 June 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Business development plays an important role in the success of a company. Business development professionals evaluate a company's performance and identify areas for improvement by establishing relationships with customers. Understanding the role and necessary skills required to work in business development can help you decide whether this is suited to your skills. In this article, we outline what business development is, what business development professionals do, what skills are required to perform well in this role and how it differs from sales.

Related: 32 Business Development Manager Interview Questions

What is business development?

Business development involves creating long-term value through the identification of potential customers for a company's products or services. This can impact many departments in a company ranging from sales, marketing, manufacturing, human resources, finance, and product development to vendor management. When a company enters a new market, the business development team is in charge of identifying and generating leads in that market.

Related: What Does a Business Development Manager Do? (With Salary)

A company that is looking to expand into new niche markets can also hire business development professionals to identify potential sales opportunities there. Business development professionals typically do the following:

  • Research potential leads

  • Match products to niche markets

  • Assess competitive positioning

  • Participate in trade associations to gain a better understanding of the market

  • Attend trade exhibitions to network with prospective leads

  • Establish and build strategic relationships with allies

  • Generate leads through cold calling, cold emails or social selling

The business development process

By cooperating with the marketing and sales teams, business development professionals can generate new leads that can increase their company's sales. This involves several processes:

1. Determining how products and services should be positioned in the market

The business development team collaborates with the marketing department to determine the best way to position their company's products and services. These professionals work closely with one another to analyse the market, deriving who their target audience is, what they need and how to meet those demands. Optimal product positioning can be achieved by changing factors such as a product's pricing, quality, and accessibility.

2. Identifying the product's value proposition

A product's value proposition is its perceived worth to a customer, and consequently the reason why it should be purchased. The business development team is tasked with highlighting how their company's product addresses their target audience's needs, as well as why it is unique to competing products. A value proposition that is clearly presented and relevant to your audience drives product sales.

3. Choosing the best marketing channels

The marketing team is mainly in charge of choosing the most suitable marketing channels to reach their target audience. They collaborate with the business development team to determine the best ways to contact and connect with potential leads. Both teams work together to achieve optimum results by gathering and analysing data, looking at current best practices and determining the marketing budget. Sales representatives may provide feedback on the platforms that have been the most effective in connecting them with customers.

4. Defining the lead generation process

The business development team is mostly in charge of outlining the lead generation process and sales funnel, from the first point of contact to the final sale. New leads can be found through networking, cold calling and cold emailing.

5. Conduct follow-up with leads

After the business development and marketing teams have generated a list of qualified leads, sales representatives take over to channel the leads through the rest of the sales funnel. This involves following up with each lead, pitching products, hosting demonstrations, offering packages, negotiating prices and finally closing the sale. Sales representatives also need to keep in touch with repeat customers, foster brand loyalty and work to convert new customers into loyal repeat buyers.

Read more: Improving Collaboration at the Workplace

Skills and attributes required for business development jobs

These are the skills that are essential to being successful in this role:

  • Excellent communication skills, both written and verbal

  • Public speaking skills

  • Analytical skills

  • Creative skills

  • Robust interpersonal skills

  • Research, strategy and critical thinking skills

  • Negotiation skills

  • Willingness to travel

  • Active listening skills

  • Attention to detail

  • Product knowledge

  • Organisation skills and the ability to multitask in a fast-paced environment

  • Project management skills

  • Data analysis

A sample job posting may look like this:

Seeking a high-energy and driven business development representative to strategically identify new leads and develop revenue opportunities. You'll be responsible for networking, researching the industry and identifying untapped niche areas for potential customers. You'll work with the marketing team to create campaigns targeting potential leads in a fast-paced and innovative work environment. Following lead identification, you'll pass qualified leads onto the sales team, partnering with sales representatives to figure out the best way to guide these leads through the sales funnel. You'll spend roughly 20% of your time travelling to trade exhibitions and industry events to network with potential buyers.

Related: Top Transferable Skills to Include in Your CV

Business development vs. sales

  • You're in business development if your primary goal is to define and pursue what, where, how and to whom your company should sell in the near future.

  • You're in the sales department if you sell what is already available today. Marketing materials have already been produced for your use, and your target customers have been identified.

Although business development and sales are two distinct functions, professionals in both areas are interdependent on one another.

Read more: Sales vs. Business Development: What's the Difference?

What is the sales department?

Sales involve the process of selling a company's products or services to generate revenue. Sales representatives are the key contact points between a company and its customers. A company with a large number of untapped leads requires more sales professionals to guide them through the rest of the sales funnel. The duties of sales representatives typically include the following:

  • Connect with leads to identify their needs and suggest suitable products or services

  • Conduct follow-ups with leads from marketing campaigns

  • Give sales presentations and product demonstrations

  • Retain technical knowledge about company products

  • Draft contracts

  • Close sales

One person may undertake all these duties in a small company, but a larger company typically requires separate teams for business development and sales. Understanding the distinction between these 2 can assist you in deciding which department is best suited to your skills.

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