posted
I thought I'd use the wise council of the masses here to ask how and what different ways sales people are paid these days. My SCORE business counselor told me to ask folks in the industry what methods. I figured it might be a percentage.I also wonder what types of incentives work well.
Thank you ohhhhh wise ones of the community!
-------------------- Dean Jones Sign One/PrimeTime Designs Asheville,NC signone15@att.net www.sign-one.com Posts: 23 | From: Asheville,NC | Registered: Oct 2004
| IP: Logged |
posted
I paid someone 30% commission of the gross sale, with no guaranty. It worked for several months until a better guaranty came from elsewhere. It generated more than enough work to make it worth my while and the residuals kept coming in for many years.
Now bear in mind most of my work is just paint and travel expense as most of what I do is windows, so there are less materials. Had there been additional materials, as with permanent signs, I would have paid the 30% on the net labor, I imagine.
Bottom line is that I am my own best salesman and nothing beats that old smile and handshake, live and in person from me. Salesmen are always a very tricky venture.
In the car business, I had a dozen sales people at a time. Pay was set at a guaranty with a 25-35% sliding bonus, based on numbers, against the guaranty (draw). 23 years ago, I had several salespeople who were making 60-75k and in today's market, the car sales people amazingly earn about the same, with a few today, making 100-120k. The money in sales is certainly not in cars, but in computer software, pharma or medical equipment. In 1973, the best salesman at a Chevy store in Wichita was making 275K and was the nation's leading Chevy salesman. Times change! He was selling some 40-50 cars a month, but today a good car dog can only crank out maybe ten.
Now back to the sign business...I used to hear that bulletin salesmen did real well selling billboards? Does anyone know the numbers, there?
-------------------- Preston McCall 112 Rim Road Santa Fe, New Mexico 87501 text: 5056607370 Posts: 1557 | From: Santa Fe, New Mexico | Registered: Nov 1998
| IP: Logged |
posted
Another interesting area that I ran into by accident many years ago was some British guy who had a used van with a bucket on the back roof that he bought at an auction from a telephone company. He filled up the van inside with plastic streamers and flags and just went out into the rural markets in Kansas, Missouri and several other states to sell streamers to the car dealers. OK. He was crazy and had a long, handlebar mustache, but he did hire a couple of dancers from some gentleman's club to wear short/shorts and halter tops to go up in the bucket and do the installations. He had the market cornered! I watched the guy scoop in to some stores and clean up a quick grand in just a couple hours this way and was off to the next store. Then he figured out he should also sell them stainless steel wires to hang the streamers on, to make them last longer. The women were very good sales people, I suspect, because he was the busiest streamer guy I ever heard about. He retired after ten years and moved out to LA to do something else. It is all marketing! I still have dealers ask me if I know how to get hold of the streamer Brit.
-------------------- Preston McCall 112 Rim Road Santa Fe, New Mexico 87501 text: 5056607370 Posts: 1557 | From: Santa Fe, New Mexico | Registered: Nov 1998
| IP: Logged |
posted
When I first got into signs I approached some sign companies about working on commission and got a whole range of replies. A large one (they did McDonald's and Wendy's type signs) offered me 7% which is not enough to even cover the cost of all the prospecting you need to do. Another even offered to sell to me at retail and let me add my profit to that. I don't think so.
My point is I don't think there is any one way and most shops don't even want to deal with people who trying to sell signs on commission. It is a real bag of worms. Think long and hard before considering it. Many pitfalls and dangers involved.
-------------------- Patrick Sweeney Terre Haute, Indiana Highline Signs Posts: 40 | From: Terre Haute, IN | Registered: Aug 2003
| IP: Logged |
posted
I made the mistake of trying to type all the following on my PDA phone only to have it lock up when I tried to preview.
I had a salesman working for me from 1980 to 1982. He was a personal friend, experienced in sales, but not sign sales.
After taking off sales tax and permit fees, I paid him 12%. We were doing many electrical signs as well as sign packages for apartments and sign systems for new business parks. I also paid him a salary of $75.00 per week (remember, this was the early '80s) on top of the commission to take care of the extra things a person in a small company often gets asked to assist in.
I turned over the regular accounts I normally dealt with to him to give him a start and he also had to generate his own leads. We subscribed to the Dodge Reports to help with that.
To provide an even pay structure, I gave him a draw and the commission was reconciled with the draw every quarter. When we were first negotiating his compensation, I asked him what happens when a salesman cannot cover his draw. His reply was: "Well then, you usually replace the salesman."
I also gave a car allowance based on the auto mileage deduction the IRS allowed at the time.
The salesman worked out well for me but did not free up my time nearly as much as I'd hoped since I often had to become involved due to the custom nature of what we did. Also, the regular accounts I'd turned over generally preferred working with me since I had been caring for them for so long.
After he left the company, I never hired another. I'm the best salesman for us since I know the business more intimately than anyone here and can handle the inevitable questions and explanations that are a necessary part of the sales process better than any other employee I've ever had.
That being said, I have occasionally paid exceptional employees sales commissions on top of their hourly rate for really stepping up and handling some accounts after I got too buried to deal with the customer. They usually got 8-10% after sales tax and permit fees were removed. In those cases, they had to go to the jobsite and do all the site surveys and measurements, do the initial design work (checked and tweaked by me), carry out all the face to face meetings with the client at the jobsite, and assist in the permitting process. If they're going to get paid for doing my job too, they're going to help do my job.
Rather than what I stated in the preceding paragraph, what I prefer to do is give a bonus after the job is done. That way, there is also incentive to handle the production properly. Several times, I have given $5000.00 bonuses to key employess who really went above and beyond the normal call of duty to help in getting large sign packages out. I figured if I benefitted from that large job and extra effort, they should too.
-------------------- David Harding A Sign of Excellence Carrollton, TX Posts: 5092 | From: Carrollton, TX, USA | Registered: Nov 1998
| IP: Logged |
Printer-friendly view of this topic