The question of whether or not to hire commission only salespeople is one that often comes up for many sales managers and it’s a good question.
Mind you, some sales managers feel that some of their full-time salespeople should already be on commission only, but that’s a problem and a blog for another time!
Commission Only is an Attractive Proposition
The lure of hiring 100% commissioned salespeople is strong. After all, as commission only salespeople, they’re mostly out of your hair (if, as a sales manager, you have any hair left). And being on commission means they won’t cost you anything if they don’t make any sales.
But wait. The idea of having salespeople, part-time or otherwise, is to get sales isn’t it? It’s not to hire a bunch of sales gypsies who wander from place to place trying to find the occasional sale. Of course these people get a sale now and then but, remember, even a blind squirrel will find the occasional nut! Selling shouldn’t be more chance or luck than skill.
What you want are people out in the field beating the bushes for opportunities that they can turn into closed sales. Can part-timers / commission only reps do that? They can, but they rarely do. Why? Because they work part-time. Let me explain.
Three Reasons Commission Only Reps May Not Work Out
First off, while there are many reasons for taking a commission only sales job, not needing the income from a full-time one is high on the list. Another reason is not really needing a job but wanting to be semi-employed. Put another way, these are people who want to be employed but who don’t want to work. You may already have a few of those people now!
Of course, there are those people who take commission only work to augment their income from their main job. While I admire their intentions, I also realize that holding two jobs can be physically and emotionally tiring and tired people don’t sell well. Basically, they’re often too pooped to sell.
You’ll probably agree that selling isn’t particularly easy. It’s more than just going around and talking to people all day long. If you’re in retail sales where more customers make a buy than are sold to, you’ve got it relatively easy. (There are those who would consider the term “retail sales” an oxymoron.) Outbound salespeople have to go out and find people who want their products and services. That’s a completely different and much more difficult situation for many salespeople and especially for part-timers.
Just trying to find folks who want or need what you’re selling can be a real challenge. Then, when you do find them, you need to get them to listen to your story. If you get that far without getting rejected, you have to overcome their objections in your attempt to help them make an informed buying decision. If you survive all that, you’re exhausted! I know that selling shouldn’t be this problematic but it is for those fully commissioned reps who are untrained and don’t know how to take control of the selling/buying process.
Selling is Difficult (Duh!)
After hearing a litany of, “I’m not interested”, “I don’t need any”, “Your price is too high”, “Not today”, “Call back another time”, etc., a person can get downright depressed and start having extended coffee breaks at Starbucks with all the other depressed commission only (and full time, salaried) salespeople.
It’s not that these people are slackers, although some might be. It’s that selling is difficult and requires a commitment of time and energy – ingredients that part-timers may not have a lot of.
So while they’re doing little or nothing, you’re pulling out what’s left of your hair managing them. Actually, you’re not really managing them. You’re spending time trying to find out what they are and are not doing. This is time that you could be spending on more profitable activities like coaching the salesperson who wants or needs your assistance and has made the commitment.
Commission Only Isn’t the Answer
I’m sure there’s someone out there who is thinking, “No sweat. I just put them on commission-only, turn them loose, and let them sink or swim so I’m not losing any time or money on non-performers.” Not necessarily true.
Sure you didn’t pay them for the sales they didn’t get, but how much business did you not get because of them?
You hire salespeople, full or commission only / part-time, to get sales. If someone can’t or won’t get sales for you, help the person move on to a job that’s better suited for his or her talents or lack thereof.
Are all 100% commission only sales reps losers? Not by any means. But, as a general rule, they don’t usually work out for some of the reasons I’ve mentioned above and several more that I haven’t covered.
Hire with Caution
If you’re going to use commission only, hire with caution. Make sure you know why they want part-time work. Make sure they know that selling is a challenging profession that needs a commitment on their part if they are to succeed. Set performance standards such as the number of calls or sales they are expected to make in a day, week, or month. Monitor their performance. Help them be successful.
Commission only can work out well and can be winners if you hire smart and manage creatively.
Good luck.
SalesForce Training & Consulting is a professional coaching and training firm that specializes in helping companies navigate their way in a Salesforce.com environment. SalesForce Training is based in Toronto, with trainers in Boston and Chicago, providing sales coaching, sales management consulting, Salesforce.com training and Salesforce.com Admin support, sales training and sales personnel assessments.
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