This question and answer series of articles provides scenarios for business owners to find answers to business frustrations. Today we discuss the business of sales.
Q: I cannot afford a full-time sales person. What is the best way to incentivise someone? A base plus a % or just a %? With or without expenses?
It’s not so much a matter of motivation as what the business can afford. You first need to work out what you are allowed to do within your industry. For instance, some industries don’t allow commission only, which will cancel out that option. If you can pay commission only, you then have to ask if by doing so will you get the person you want. In other words you might get the sort of person you don’t want to afford rather than the sort of person who you want to represent your company and your brand. Where is the person you want to represent you right now? And what do you have to do to attract them? Remember, it’s not always salary. What are they looking for in a job? Are they the sort of person who wants strong guidelines to do the job or are they going to be motivated by you inviting them to share and contribute to strategic sessions on a daily basis? Incentives and commissions are not necessarily motivating factors, simply methods of payment. Your question raises many more. Are you paying incentives because you can’t afford a base salary, or are you paying it as a motivating tool?
A study published some years ago in Inc. Magazine looked at the most important long term motivators for employees. The highest motivating force for people to stay with a firm was a sense of mission and purpose at 35%, followed by feedback and communication at 21%. Raises and salaries came in at 16% and at the bottom of the heap on 8% were performance bonuses and percentage and ownership. If these factors still hold true, and I believe they do, then your key role is to learn how to communicate your vision and sense of purpose in order to attract the people with the right attitude who see your company as an exciting and rewarding place to work. The method of payment is then almost a side issue and will almost work itself out.
Q: One of my advisers is always returning to the office with a significant number of leads and I think we are really going to get some new business happening … disappointingly they all fall over and he fails to convert the leads to clients. How can I help him?
Selling isn’t about ‘selling’. It’s about uncovering the needs, finding the match, and providing a solution, or creating the value in the mind of the customer – or all three. You have to understand that nobody wants to buy what you have to sell. They want to buy what it can do for them. If your adviser is only thinking of his commission, then he will rarely make a sale. He needs to turn his focus to the customer’s needs and the value. What difference will your product make to their lives? Do you have any added value service features that make the difference between just making a sale and creating a client relationship? What can you do to shift the customer’s perception of your product from that of a commodity they can get anywhere to a choice of your brand above others? Often that’s a service or added value detail. (I bought a car because it had a picnic table. Someone else I know bought one because it had a great coffee cup holder. Go figure!) If your adviser gets this right, they will most likely reap the rewards of loyal repeat business too, not one-hit wonder sales.
Watch for Part Thirty-Three of the Q & A series…coming next week!
Until next time…
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