Hiring commission only sales people is not the same as bringing on salaried employees. There are potential issues that need to be considered in order
Hiring commission only sales people is not the same as bringing on salaried employees. There are potential issues that need to be considered in order to minimize long term concerns and maximize profitability just like any business decision. Hiring commission only sales people is a step that can have lasting effects on an organization, both good and bad.
The first factor you need to understand about hiring commission only sales people is that they are not free. The cost to hire, train, and support them is the same as any other employee. Managing commissioned personnel can actually be more costly in both time and resources as they are independent operators and tend to act as such.
When hiring commission only sales people you need to closely consider your company’s sales cycle and the potential implications it can have on their sales process, motivation and income. A long sales cycle can mean large fluctuations in commissions that may undermine your efforts to keep personnel inspired and production steady. For a sales cycle in extent of one month you may want to consider paying draws on future commissions.
Commissioned people tend to believe their job ends when orders are received. The part that often gets overlooked is the after sale customer service and support. You’ll want to make sure you have a detailed customer service plan in place with clearly defined roles prior to hiring commission only sales people.
Hiring commission only sales people can be very successful if the sales process is simple. That allows personnel to focus on customer contact and driving revenue. The more complicated the process the greater the commission they’ll need to keep focused and motivated. If you have multiple products or services with varying levels of complexity you may want to offer a graduated commission scale to maintain your product mix.
Sales people tend to jump jobs and commissioned personnel are amongst the worst. In order to keep the best sales people you’ll need to keep them happy and well compensated. The percentage of sale, or profit, paid should match the time and effort required of the sales person. Make sure commissions are paid on a regular schedule and any disputes handled in a timely manner. Consistency will earn their loyalty and aid your bottom line.
As with any personnel decisions, hiring commission only sales people is not to be taken lightly. But with a well thought out, detailed plan in place you can reap the benefits and drive your revenue to all new levels.
Rhys is a tenacious, top performing Senior Sales Recruiter with 15+ years of focused experience in the Digital Media, Mobile, Software, Technology and B2B verticals. He has a successful track record of headhunting top performing sales candidates for some of the most exciting brands in North America. He is a Certified Recruitment Specialist (CRS) and has expert experience in prospecting new business, client retention/renewals and managing top performing sales and recruitment teams. Rhys enjoys spending quality time with his wife, son, and daughters, BBQing on a hot summer day and tropical vacations.