Commission based salesteam

[1982_adam]

Hi all,

My company is at the point where we need to now have a sales team. We have been given some advice by friends and "business link" but i thought i would ask you guys for your thoughts.

My prefered route to go down is the " commission based " route but i am unsure if we can go down this route with tax reasons etc. I have read past posts that say you can do this if you contract them as freelance? Is this true?

Your guidance would be very much appreciated.

Adam

 

[chris424uk]

This is all dependent on what you're selling and how much commission can realistically be made. If you want to attract high-calibre salespeople, then they'll most likely request a basic.

 

[Norman]

Hi Adam

I've worked in commission based sales for the past 20 years - never had a basic - never wanted one either.

The top performers in direct sales all tend to be commission based.

You need to get them to sign an Agency Agreement that spells out exactly how you employ them.

Second you need to have a very close look at the commission structure and how you will monitor it.

Thirdly you will have to make sure your price list covers commission payments.

And forthly you will need to make sure the salespeople stick to your price list. Any deviation should come out of their commission NOT your bottom line.

And fifthly you will need strong management to control them. They also tend to be mavericks.

best of luck

 

[bluesandsltd]

I can tell from Norman's post that he is obviously good at what he does, his confidence in not wanting a basic speaks for itself.

However - this does not account for the masses and unfortunately unless you 'incentify' a sales person whilst giving them the opportunity to take something home whilst training/up-skilling or just in general, most won't do it - and if they do it is generally not to the calibre that actually delivers a return...

I would say that if you have a basic in mind that you could afford to pay, drop that somewhat, then incentify with a commission structure of some sort..

Kind regards

Francis

 

[telemax]

Hi all,

My company is at the point where we need to now have a sales team. We have been given some advice by friends and "business link" but i thought i would ask you guys for your thoughts.

My prefered route to go down is the " commission based " route but i am unsure if we can go down this route with tax reasons etc. I have read past posts that say you can do this if you contract them as freelance? Is this true?

Your guidance would be very much appreciated.

Adam

It's also a heck of a lot easier to get commision only sales people if you provide them with the leads. If you are expecting your commision only people to do all the telemarketing and lead generation on top of closing deals it's going to be a lot more difficult for them.

I used to work as a commision only sales person very successfully. I drove all over the country chasing deals worth a minimum of several thousand to £30k commision. To me that was a true incentive, however if the commision value was less than that I wouldn't have bothered. I think I speak for the majority in that profession.

 

[haider10961]

Hi Adam!
Could You Specify A Bit More About The Product You Offering To Opt "telemarketing" Service.
As I Could Offer A Very Cost Effective Option For You.
Pm Your Contact Details To Discuss Further Possibilities.
Cheers.

 

[DIDAMEDIA]

I need some commission-based sales and maybe someone to do business development for me. Where can I find these people?

 

[3 MORE YEARS]

To get descent people you will need to pay some sort of a basic salary.

 

[Norman]

For what its worth here's my thoughts.

I've worked as Sales Manager for both Monster.com, Yell.com and a couple of internet start ups where people have basic salaries of circa £25/£30K + OTE bonus.

I've also spent many many years in commission only sales with NO basic, NO car and No company perks other than leads.

And in my opinion the better sales people are in commission only. By better I mean those that write business.

For a new business keeping costs down at the start is vital and you tend not to have the luxury of employing sales people on a basic for say a couple of month before realising they are not going to cut it. You are suddenly down up to £5k and have to start again.

And having interviewed hundreds of sales people over the years it never fails to amaze me how good they are at being interviewed and how poor they are at actually doing the job - i.e. bringing in sales.

I run my own home improvement business and I would never dream of employing salaried salespeople.

All spare money I have is use in marketing to ensure I am able to give them a steady supply of good quality leads.

If your product is good, if people have a need and it it properly priced commission based salesmen will bring it the business for you.

However you would need to provide them with good quality leads. They tend not to be good at sourcing and cold calling.

best of luck

 

[telemax]

However you would need to provide them with good quality leads.

best of luck

That's the most important thing. If you expect your commision only guys to go out and get all your leads for you on top of closing sales, they won't last 5 minutes!!

 

[3 MORE YEARS]

If you have quality leads then a lot of people would be able to close those sales for you and doesn't necessarily need to be pro sales people. However, if you can't provide leads, and they would have to be generated then without doubt you would need to provide a good basic.

 

[RCS LTD]

I Am A Closer In Nottingham Looking For A Sales Based Job Can Any One Help? I Require Leads Only No Basic.

 

[MH1]

If you have quality leads then a lot of people would be able to close those sales for you and doesn't necessarily need to be pro sales people.

This is partly correct, but having spent many years in commission only sales a professional salesperson will generally outperform an average salesperson by 100% week in and week out.

As with any profession, occassionaly you will find someone who is more professional, a better listener, a better closer, who walks away with the order rather than taking the first couple of rejections and giving up.

It's hard to say what makes the difference, but there is a huge difference in performance and sales. If you manage to find one of these people they are worth their weight in gold.

 

[msmglobaltrade]

Hello

I own my own furniture company, and i have myself and one other person as the sales team as i have found getting people to work on a commission basis is very hard to get, unless you can garentee something which they will want to work for, like they get a gift from the company or a big bonus if they earn so many sales.

I offer a free contracted phone if they get a 10 companies placing orders continuously throughout the year and a big bonus if they earn over £500,000 worth of sales within the full year.

Hope this helps.

Mark

 

[captaincloser]

With over 25 years as a commission only guy and manager of sales teams around Europe, the US and the Far East I can add the following advice.Salaried (basic) sales people very often work down to their basic level and it's a very British thing. 4 from 5 will work down to their basic..and hope for the best having got the car, the £30-50k, the Blackberry, the Laptop, a fact of commercial life in the UK and the 80/20 Pareto principle holds very true here. I have been on both sides of the fence and here are some observations...

A basic plus small commission makes no difference...but commission only attracts two types of salesman.The best and the worst.It attracts the best because with a sensible adult approach by end users of a good commission only salesman everybody wins. Good commission only guys shine through...You have to like them instantly is a good rule of thumb and they need to have been out in the world and away from mummy and the mother ship to be fully rounded for the battles ahead. The loudest guy in the room invariably is not the best in sales but the guy who is very confident in his own skin and presentation (appearance)and is polite and well spoken is the one to back for commission only work.


'Commission only' attracts the worst because ' bad, unemployable salespeople' or 'anypeople' will also apply for these jobs. If it's MLM they will all be taken on .Business owners should ask for testimonials NOT CV's. Salesman cv's are pointless.

I would add that it's a two way stretch.Some of the very worst employers offer commisssion only deals which are very bad deals indeed. Certain situations cry out for commission only where others need salaries if the selling is a long process and involves more than the sales guy. Advice to potential commission only salespeople would be: Refuse to be flattered by offers..You are buying work if you are not careful and NEVER work for anyone who is not or has not done the job you are being asked to perform.

Also, like a previous poster says do not work for anyone who does not supply leads, 100% support and does not pay very promptly.Underfunded start-ups need to be approached with the most caution. Particularly if they have 'everything' in place except sales. Be super-wary of the business owner who sees sales as an afterthought and ignore any SME srart up MD who does not sell himself. A commandment in business frankly.

Without sales drive no company will make it and the amount of times I have sat down with 'directors' who haven't a clue is staggering...Walk away... fast. Never be owed money on commission only situations. Also never work in situations where as the sales guy you are treated poorly. Respect on both sides makes the deal work...Many commission only guys earn more than the MD and he is always delighted. Conversly if you are kicked out quickly take a look in the mirror as it will have been your fault usually. Don't oversell yourself and under-deliver...the easiest thing to do in 'commission only' sales position interviews.

Set your standards and interview the company...don't let them do you 'a favour' by hiring you on a commission basis. There are some dreadful people about..Just be realistic about yourself and the 'opportunity'. Always test and measure. Give it a week, then give it another, then maybe a month but no more if you are not cutting deals. Also as a previous poster said some of the very worst salespeople talk a great story at an interview and fully deserve to be kicked out very quickly if they do not live up to their own hype.

Everyone (company and sales guy) should eyeball the person across the desk very warily before commission only deals are struck is my tip. If you suspect something...you will always be right. Very few people can keep up the nonsense under intense eye contact. If in doubt ..shut up and stare.

There is something very satisfying about being freelance and not owned by a company...there really is and I cannot think of a better way of making a living given, as Australians say, 'All your ducks are in a row'.....

 

[patientlady]

Without sales drive no company will make it and the amount of times I have sat down with 'directors' who haven't a clue is staggering.

Thanks for this post, someone who has some respect for a sales team.
I have to say that I am not on commission only. I am one of those, basic, co BMW, lap top kinda girls! I make my own leads & close my own deals. I work hard, & play hard 7 days a week, the 'sale' gives me the buzz. The perks are the above together with a sometimes appreciative boss.
Interestingly he doesn't understand the concept of selling at all, but because he is a nice guy I try to ignore the negatives (most of the time), although can be frustrating.
Often I note people asking for 'commission only people' because they cannot afford to pay a basic, but cannot find anyone suitable. How is this surprising?
Good sales people need respect and 'are an investment' in every sense and they should be offered the package that suits there circumstance, whether it be basic or commission only, not neccasarily what actually suits the employer. A good sales person is worth there weight in gold!