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The right pay package for your salespeople

    The right pay package for your salespeople

    If you’re taking on salespeople for the first time it can be difficult to know what pay package you should offer. Sales roles are target-driven and so pay packages tend to be based on results. Packages usually include lots of incentives.

    It’s important you spend time investigating the right combination of basic pay and incentives. Getting it right can help you to attract, retain and motivate the right candidates and be clear about what is offered from the onset.

    Pay structures for sales staff
    The typical pay structure for a salesperson is composed of a fairly low basic salary with an additional amount of commission. However, at most levels of seniority, salespeople are amongst the best-paid employees in business, so think about the level you’re planning to recruit at and budget accordingly.

    The package will usually be called OTE or on-target earnings, meaning that if a salesperson hits the targets specified for them, they will be guaranteed that amount of money. A higher commission can be paid if the person performs beyond this target. Such incentives naturally help to instil a desire for sales.

    You can customise pay incentives to your business’ benefit. For example, if the company’s future is heavily dependent on the success of a new product, you might want to offer a higher level of commission for sales of that product. Linking sales with commission in such a way can therefore assist success.

    Non-financial incentive
    Finally, remember to think about non-financial incentives as these can be more effective. Securing an order provides its own sense of achievement for salespeople, but when orders are not so easy to secure you need to think of incentives to motivate your staff.

    Recruiting new salespeople

    Before recruiting sales staff you should establish what skills, experience or training they will need. Will they need knowledge of a particular market or the ability to use a certain piece of equipment or software? Or is it preferable for candidates to show a strong sales record?

    Once you have identified your requirements, decide which recruitment method is most likely to be successful.

    There are four main recruitment options:

    Newspaper or magazine advertisements – can be a relatively cheap and direct way of recruiting. For example, advertising in a trade magazine gives you a good chance of finding suitable applicants, but the response could be quite low. Newspaper readership figures may be higher, but you could be deluged by unsuitable applicants.
    online advertising – either on your own website or on specialist online recruitment sites. This can be a cheap way of reaching a wide audience. A link to your website can provide more information. However, you may receive lots of applicants that can be time consuming to shortlist.
    Recruitment agencies – have experience of matching the right candidates to the right jobs. The fees can be high and you might have to pay the agency a percentage of the candidate’s salary. However, they should save you time by conducting the interview selection process for you.
    Networking – a cheap way of finding suitable staff. You could introduce an incentive for recommending suitable candidates, or approach a good salesperson you have dealt with. If you act on a recommendation, you should still conduct the necessary checks such as looking at the applicant’s CV and checking references. This could prevent misunderstandings and potentially costly tribunal claims. A disadvantage of networking is that it’s unlikely to identify a large number of potential candidates at the right time.

    Hiring the right sales people

    Interviewing sales staff is an excellent opportunity to see how good they are at selling. If they are unable to sell their own abilities, then it’s unlikely they’ll be able to sell your goods or services to your customers.

    When considering the personal qualities that make a good salesperson, you should look for:

    resilience – someone who bounces back from rejection
    urgency – a competitive character who wants to get on with things
    persuasiveness – someone who wants to bring people round to their point of view
    assertiveness – a person who makes their point firmly but not aggressively
    sociability – someone who’s friendly and bonds well with others
    enthusiasm – someone who really wants to sell your products
    self-motivation – someone with the initiative, drive and ambition to find and close deals for you
    Ask about the candidate’s past achievements. How many sales did they make for previous employers? How did they help develop the business? How did they target and win sales from potential customers? To guard against exaggeration, ask for confirmation of their claims.

    The image your candidates convey is very important. Would you – and your customers – be comfortable with this person as the public face of your business? Are they appropriately dressed? Do they listen well and speak articulately? Do they ask intelligent questions about your business?

    Make sure you abide by anti-discrimination law. See prevent discrimination and value diversity.

    Remember that different sales techniques can be appropriate in different businesses. You need to hire a person with the specific sales skills you require. For instance, a rapid-sales technique may be ideal for high-volume cold-calling but not if you’re selling a complex and high-value product or service requiring significant account management.

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