In any marketplace, there will be a select group of salespeople who have the reputation of the being the best. Obviously, one of management's jobs is to have as many of these sales leaders as possible working for their company.
Selecting and training outstanding sales people is the first step. Keeping those stellar sellers is the commonsense second step.
Still, sometimes what seems so simple and elementary can be one of the biggest challenges. In today's world, keeping outstanding salespeople as career employees can be difficult. Transferable retirement plans like 401(k)s make it easy for salespeople to develop transient tendencies unless they are strongly encouraged to stay with an organization.
The distributor acquisition trend also encourages nomadic tendencies among sales folks. When a company is sold, employees naturally feel uncertain about their futures with new management. That period of ownership transition can be an opportune time for you as a competitor to lure away successful salespeople.
Fully trained and developed salespeople are extremely valuable. They will be immediately productive, and they will take some business with them when they leave a distributor.
Of course, the concept of luring away trained sales staff is only a good one when you're doing the fishing.
Losing outstanding sales performers, especially to competitors, can be costly and is often unnecessary. It takes good management to keep top people performing in a win-win situation that allows both management and the salespeople to share fairly in sales and profit results. One of management's top objectives must be to keep the entire sales force motivated. Here's how:
Treat your sales team with respect. Successful salespeople work smarter and harder than average producers. It's management's responsibility to bring out the best effort from these top performers by providing them a predictable, productive work atmosphere.
Keep the company on the cutting edge with the latest sales technology. People like to work for a company that provides the latest sales aids: PDAs, contact management software, etc.
Motivate top performers with both financial and personal recognition. It's a great feeling to be one of the best in your sales field. Top performers thrive on challenge and enjoy interacting with customers, suppliers, and industry associates, but sales leaders don't just happen by accident. Sales leaders have a strong will to succeed. They are a cut above the average; and they have a mission. Both good listeners and good speakers, your top salespeople are people that other folks like being around.
Give special company recognition to outstanding sales performers in the form of “Salesperson of the Year” and “Extra Effort” awards. Salesperson of the Year goes to the largest sales and gross-profit leader. Extra Effort is awarded to the salesperson who does the best overall job with his or her account assignment.
Salespeople like money and personal recognition. A wall plaque in the office reception area and take-home trophies are great motivators. The office plaque tells customers, suppliers, visitors and co-workers who the top sales performers are at the company. It gives industry recognition. A trophy at home gives the salesperson recognition to family, friends and guests.
Give salespeople negotiating authority (within company guidelines) to close orders. The longer it takes to close an order, the more likely additional competitors will enter the fray. Customers prefer to deal salespeople who have authority to close a deal on the spot.
Use a commission plan that is fair to all parties involved. A good commission plan will have sales expense flexibility. In a good year, sales expense goes up, as does company profit. In a down year, the company is not stuck with a fixed guaranteed sales expense. It keeps the company overall results more predictable at the bottom line. If a company's plan is set correctly, then commission salespeople and the company will share equally in a good year and both feel the financial pinch in a down year.
Use the same fair commission plan for the entire sales force; the only exception could be for new startup field salespeople who need a specified salary for a limited time until they are ready for the regular commission plan. Usually, this a relatively short period if you've hired quality people and assigned sufficient potential account bases.
Still, when using the same commission plan for the entire sales force, a select few salespeople will earn a higher income than the rest of the staff. After many years, the old 80-20 rule pretty much applies: 80 percent of the business comes from 20 percent of the accounts. A similar percent usually also applies to the sales force.
As a result, even when the commission plan and the customer account assignment is objective and fair, a top performer can have a “career year” — possibly being the highest paid person in the company in any particular year.
Let the top performers make a large income. Their performance example will set the sales bar higher and plant the seed for the rest of the sales force. After all, if Bob can make big money with the same commission plan, then why can't Dave work smarter and harder so he can reach select status, earn a large income and receive industry recognition and respect? Still, Bob and Dave have different strengths.
Customer accounts should be assigned drawing on individual salespeople's strengths. Some salespeople are better suited for smaller accounts and can call on and service a considerable number of accounts. Other salespeople are effective and productive with large “mega” type accounts. They should handle a select and limited number of assignments.
Give “mega” accounts to your top salespeople. There are usually only a relatively small number of potential “mega” accounts in a given sales area. It's important to have your top salespeople covering them. Many mega accounts want to limit the number of suppliers with which they do business. They want to simplify the purchasing process and limit the number of transactions involved. Of course, they want the best possible service and pricing that a company of their size warrants.
Large accounts that give the bulk of their business to a very select group of suppliers expect the supplier to have a top-quality, highly qualified salesperson assigned to their account. They want the best salesperson the distributor has to offer; they should have the best because they will be giving the supplier large amounts of business. They need technically qualified salespeople who have a good industry reputation for effectiveness and the ability to keep their company information private.
If management follows these suggestions, retention of top salespeople should be high. Still, some salespeople may reach a point when they no longer feel challenged; it may be time to promote that salesperson to management, which we'll delve into next month.
Bob Finley was the longtime president and CEO of Glasco Electric Co., St. Louis. Glasco is now a part of Rexel.
PDAS CAN EASE SALES REPS' LOADS
Larry Hooks remembers his days of making sales calls with a pencil and paper: “There were times when I scribbled things down and couldn't figure out what the heck I wrote after spending eight hours with six different customers,” said Hooks, the owner of Parker Industrial Safety. Hooks also recalls many instances when customers called to complain that they didn't receive a product — even when his drivers remembered making a delivery.
Prophet 21, Yardley, Pa., offers a solution with CommerceCenter's Personal Digital Assistant (PDA) integration.
PDA integration lets distributors store pick ticket data and route information in compact, inexpensive, easy-to-use PDAs. The integration also lets drivers capture customers' signatures upon deliveries, and enables sales representatives to download and store customer order information in a PDA — then upload orders taken on a PDA directly into CommerceCenter.
Hook says the PDA integration has already had a positive effect on the balance sheet. PDA Signature Capture capabilities have improved proof of delivery processes, and have reduced reships at Parker by about 5 percent. “It's not a huge number, but it really adds up,” Hooks said. “We're not resending things automatically when people complain they didn't receive something. Instead, we can tell them that their receiving person signed for it at 10 a.m. yesterday — and fax or e-mail them the signature.”
Because Hooks' sales representatives use PDAs to take customer orders on sales calls, and then upload them directly into CommerceCenter, order-processing time has been cut dramatically. Sales representatives now spend time at the end of the business day planning the next day's activities instead of frantically rekeying orders.
“CommerceCenter and PDAs have definitely saved me a lot of time, money, and energy on the customer side,” Hooks said. “Plus, I'd much rather spend $100 on a PDA than thousands on a laptop.”
For more information about Prophet 21, please visit www.p21.com or call 1-800-PROPHET, ext. 3120.