Commission only salespeople

Discussion in 'General Business Forum' started by Liam-a, Feb 6, 2021.

  1. Liam-a

    Liam-a UKBF Contributor Free Member

    32 3
    Hi all,

    Just a quick question.

    Im thinking of advertising some positions for salespeople selling kitchens and bedrooms.

    Either commission only or a very low basic plus commission.

    I was just wondering if anyone has any experience in this, wether the commission only makes the salesperson hungry to sell and achieve?

    Thanks in advance
     
    Posted: Feb 6, 2021 By: Liam-a Member since: Mar 16, 2018
    #1
  2. Uke

    Uke UKBF Newcomer Free Member

    18 5
    Any half decent salesperson wouldn’t touch a commission only job with a barge pole (of course there are exceptions but they’re very few).

    Jobs like these with no or low basic scream lots of warning bells to potential employees (and potential clients too).

    Invest in an attractive basic with a good commission scheme and you’ll attract some good quality candidates who will perform well, stay and help you grow your business. With commission only staff you’ll end up with a load of chancers who’ll lie, cheat and do anything for a sale. Or simply be completely useless.
     
    Posted: Feb 6, 2021 By: Uke Member since: Feb 5, 2021
    #2
  3. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    5,369 2,185
    Commission only is alive and well - and is likely to grow in the coming recession

    However, good commission salesmen know they are good and will need a compelling offer to attract them

    Mediocre ones are 10 a penny, and you will basically have a revolving door, unless you chance on the odd undiscovered talents.
     
    Posted: Feb 6, 2021 By: Mark T Jones Member since: Nov 4, 2015
    #3
  4. Mr D

    Mr D UKBF Legend Free Member

    27,198 3,341
    I would perhaps take on commission only sales work. For maybe 30 to 40 percent of the sale.

    Way too often someone uses it as a cheap way of getting sales staff, however usually have to train them and commonly they quit within weeks.
    A desperate enough person out to get any job at all will be willing to do it. Chance of getting experienced sales person willing to do it cheap are slim.

    A good working model is take the staff on at a wage plus commission, have yourself or ideally an experienced sales manager train them on your methods and products then push them hard.
    Targets, bonuses....

    Commission paid then becomes a way of keeping score with the younger sales staff - they do not want just to get pay of say 1400 a month, they want a couple of grand or more.... And willing to put the effort in is what you want.

    Commission only sales roles where the person can get a couple of grand pay a month from day one could be made to work. Not paying enough will drive away anyone with responsibilities.
     
    Posted: Feb 6, 2021 By: Mr D Member since: Feb 12, 2017
    #4
  5. MBE2017

    MBE2017 UKBF Ace Free Member

    2,122 807
    I have worked a lifetime in sales, approx half of it in commission only type roles. As you can see different people view it very differently, the best and hardest sellers, the most accomplished salespeople I have worked with have always been commission only. This is because they get rewarded only for results, where salaried guys can ease their foot off the effort pedal. You need to ensure the sales are good quality decent sales, but that is easy enough to do.

    Unfortunately too many companies see this as a way to get people cheap, and see hundreds of salespeople go through a revolving door. They usually moan about getting good hard workers who can sell.

    When you have a decent company, product and reward structure, you don’t even need to advertise for salespeople, we all talk to each other. When I set up my last large team selling Gov training, I recruited over 60 top quality guys overnight, guys who had worked with myself over the previous 20 years.

    They were still all there selling with myself two years later.
     
    Posted: Feb 7, 2021 By: MBE2017 Member since: Feb 16, 2017
    #5
  6. Greg PW Shearman

    Greg PW Shearman UKBF Newcomer Free Member

    17 0
    commission only means sales staff are desperate for sales and that's when problems happen - miss selling etc -
     
    Posted: Feb 7, 2021 By: Greg PW Shearman Member since: Feb 5, 2021
    #6
  7. Mike W

    Mike W UKBF Ace Full Member - Verified Business

    1,567 359
    Commission only is fine, as long as a) the opportunity is there (and real), and b) the deal is right. Too low a percentage and, as has been said, you'll attract the poorer ones due to their ignorance and get a high churn rate. Provide a good deal, you'll attract better people and they'll stay. 100%.
     
    Posted: Feb 7, 2021 By: Mike W Member since: Aug 19, 2010
    #7
  8. Liam-a

    Liam-a UKBF Contributor Free Member

    32 3
    Hi all,

    Thank you for all your replies it's much appreciated.

    I was thinking about offering a commission of £500.00 for every kitchen sold.

    If someone sells one a day there hitting £2500.00 a week so I wont be offering them peanuts.

    Theres currently only me and to take my business to the next level I think the only way is for a sales team to come in.
     
    Posted: Feb 7, 2021 By: Liam-a Member since: Mar 16, 2018
    #8
  9. Mr D

    Mr D UKBF Legend Free Member

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    And you'll be supplying warm leads? Or requiring them to cold call / generate own leads?

    Think about what you are selling to the sales staff. The hours, the perks, the warm sales leads / requirement to generate own leads, the time from sale to payment to them, the targets etc.

    You have to sell your business as a paymaster to your sales staff before they can sell your products to customers. Unless you have a sales system and a decent sales manager hot at training, don't make the mistake of taking on people simply because they are unemployed.
    You will likely have a high turnover of staff, don't make it higher than it needs to be.

    A couple of times have come across tiered system of commission.

    xx% for first £3,000 in sales, a slightly higher figure for next £10,000 in sales, a higher figure still for next £20,000 in sales and so on.
    To get the decent rate for sales needed to do quite a bit of sales - and it was something that could be done. Of course that depends on your ability to cope with people making lots of sales...
    A different kind of problem then. :)
     
    Posted: Feb 7, 2021 By: Mr D Member since: Feb 12, 2017
    #9
  10. Mike W

    Mike W UKBF Ace Full Member - Verified Business

    1,567 359
    Hi Liam, You’re way off base I think. No one experienced would be interested, so you’ll just attract the less capable, more gullible ones who’ll be gone before you know it.

    The more experienced know too much to be fooled by what you’ve said - a sale a day won’t happen unless you’re providing at least 3 appointments a day for them - and they’d also take advantage of any fixed figure arrangement. It disincentivises selling up.

    Without knowing your situation or arrangements (ie. shop or just online), it’s difficult to comment further. Ordinarily you ought to be looking at a percentage payment arrangement, maybe with some fixed low base figure or something to cover some expenses.

    If you want to PM me with some info, I’ll let you know what I think. I was in the kitchen industry for many years. I still have a connection to it, and am actually working with someone on something related. I’m sure I can help. Where are you based?
     
    Posted: Feb 8, 2021 By: Mike W Member since: Aug 19, 2010
    #10
  11. MarkOnline

    MarkOnline UKBF Contributor Free Member

    57 26
    You need a canvassing team to feed leads to the sales team. Your commssion seems ok but how good it actually is depends on many factors. Good quality leads who are ready to buy ( or very close to) are one of the keys to your success.
     
    Posted: Feb 8, 2021 By: MarkOnline Member since: Apr 25, 2020
    #11
  12. MarkOnline

    MarkOnline UKBF Contributor Free Member

    57 26
    Have you ever sold face to face on commssion only? This post suggests not.
     
    Posted: Feb 8, 2021 By: MarkOnline Member since: Apr 25, 2020
    #12
  13. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    5,369 2,185
    It might resonate with someone who is experienced in the kitchen industry - I'm quite sure they would have a lot of questions to ask before they agreed.

    To anyone who doesn't know the industry, it's just numbers.
     
    Posted: Feb 8, 2021 By: Mark T Jones Member since: Nov 4, 2015
    #13
  14. MBE2017

    MBE2017 UKBF Ace Free Member

    2,122 807
    Perfect recipe for encouraging mis selling. Not an expert on kitchens but I would have thought 8-12% of the nett sales would be in the ball park, and you want the salesperson to be able to ACHIEVE £1000 per week minimum IMHO.

    So if an average kitchen sells for £5/6k, approx £500 per kitchen, and so on. Do you currently sell yourself or have others doing so, their closing rates might help with the figures, average of 20 to 30% is the norm, top closers 30/40%.
     
    Posted: Feb 8, 2021 By: MBE2017 Member since: Feb 16, 2017
    #14
  15. Mr D

    Mr D UKBF Legend Free Member

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    I've been offered commission only and came back with similar offer to the company. What some would like people to do is get 1% commission paid when they get each payment (6 to 12 months later) and no other costs.
    What my mortgage provider and indeed my wife wanted was me bringing home enough money regularly to pay the bills. Hence me suggesting a figure that amongst other things pays the bills including the months waiting with zero money coming in.

    Have done sales work quite a bit. I chose companies with base plus commission - and earned some darn good commission over time. I liked selling, just didn't like the traffic jams to do it.
     
    Posted: Feb 8, 2021 By: Mr D Member since: Feb 12, 2017
    #15
  16. MarkOnline

    MarkOnline UKBF Contributor Free Member

    57 26
    More drivel. Cant make head nor tail of any of that.
     
    Posted: Feb 8, 2021 By: MarkOnline Member since: Apr 25, 2020
    #16
  17. Mr D

    Mr D UKBF Legend Free Member

    27,198 3,341

    I'm responsible for what I type, not how you read it.

    Would suggest you ask for a refund from your school.
     
    Posted: Feb 8, 2021 By: Mr D Member since: Feb 12, 2017
    #17