Should You Hire a Salesperson?
May 11, 2011
The decision to hire someone to do marketing for your company is never an easy one. It’s scary, because it will probably cost considerable money and the return is never guaranteed. On the other hand, to not hire someone may mean your company is potentially losing out on thousands of dollars of income.
Let’s take a look at the issues involved.
What is the Downside Risk?Before I ever make any decisions, I always ask myself this question. In the case of hiring a salesperson, the downside risk is fairly obvious. Can you afford to lose a few months in salary if the person does not deliver the goods? It will take at least two to three months to discover whether your salesperson is successful or not. In our industry, marketing is about developing relationships, so it usually will take a while for jobs to come in from the marketing efforts. Are you willing and able to pay a few months salary with no return if your person turns out to be a dud?
The other question is whether you can afford not to hire a salesperson. Someone has to be doing sales work, and if not the owner, it has to be someone. There is too much work available to us via marketing and networking to referral sources, so someone has to be pounding the payment if you want to receive work from referrals.
What Do I Pay Them?Good question, and the answer is different for different situations. It depends on the area that you live in, as income levels vary from city to city, so what is fair in my town might not be enough in yours. Most important, though, is the fact that the person you hire must be really good or even great. Average is the enemy of great, and an average salesperson is a waste of time. Why not hire someone who will be fantastic?
You will have to pay a premium salary, though, for excellent salespeople. I pay my salesperson a salary of $30,000, plus a bonus of 3 to 5 percent of the jobs she brings in. If you don’t pay the person a very good wage, you probably won’t get very good results. Of course, there are always exceptions; a straight commission pay scale is a fantastic way to motivate people to bring in the work.
You Must Give Them DirectionNow that you have hired someone, you need to make sure they are working effectively and efficiently. That is your job, not theirs. Odds are, you know much more about the industry than they do, and you will have to guide them in the right direction. This takes hard work on your part and constant monitoring of the salesperson’s activity.
Many a business has spent plenty of cash in a wasteful fashion because the owner did not work hand-in-hand with the salesperson. This is of utmost importance during the first two to three months of the salesperson’s time with the company. You should have a three-month plan drafted as to what you want your new hire to be doing. Let them put together the details of who, where and when they are going out into the field, but you must present them with the big picture.
You Must Give Them GoalsThis is vitally important, because the goals will determine the activity and the planning of the salesperson’s work weeks. First of all, give them a monthly sales goal of work to bring in so that they can aim for a figure. Do you want the salesperson to achieve $5,000, $10,000, $20,000 or more in monthly sales? Pick a figure and then determine how the salesperson is going to make the phone ring to bring in the goal.
But just by picking a figure doesn’t mean that people are going to be knocking at your doors; now you want to decide what activities will work. Once you have in mind what referral sources will be worth visiting, it’s time to plan when to visit them. After you have done all this, you ought to have a weekly and daily planning regiment ready to go. Once this is done, the salesperson ought to review it with the owner so that any needed changes can be made and approved; then it’s time to get to work.
Proper Planning is EssentialDon’t neglect this crucial aspect of the sales process. Our salesperson usually spends an entire week every quarter planning her strategies and daily activities for the next quarter. It is time well spent, and I don’t mind seeing her in the office for an entire week. Additionally, her quarterly goals are posted on an 8-by-4-foot dry erase board for all to see – and celebrate when she hits and exceeds them.
Meet with your salesperson daily or at least weekly. If you have a large company, frequent meetings with the management team is very important. A good company has systems, and the meetings can consist mainly of the management staff giving reports from company tracking systems. My salesperson has weekly reports of where she went daily, the results she had and where she is going the next week. Additionally, she gives me fairly complex quarterly strategy reports every three months. Without these reports, we would not have effective meetings, and it would be very difficult to judge her results.
If you do not have a salesperson, the job still belongs to someone, probably you. Even if you are a one-person operation, the above still holds true. You need to take your role as salesperson seriously; pretend as if you actually had hired someone, and make systems and strategies in order for your marketing to work.
I find it fun, rewarding and, yes, difficult to perform all the tasks I have mentioned, but the results are amazing. Our salesperson consistently brings in $20,000 a month in new work, and we know that figure is only going to increase. Is it worth it? You bet, but it just doesn’t happen out of thin air. Make your determination that you are going to have an effective and vibrant marketing division in your business and then prepare, plan, produce, profit and play!