LESSON 10 - BUSINESS BASICS PART III - MARKETING & SALES

The Sales Force – Size, Organizing, Training, Motivating & Compensating

 

The sales force needs to be properly organized, motivated and compensated in order to have the right size to do the workload, alignment to cover all needs, and keeping them happy and selling.  In most companies, the sales force is the most critical part of the business.  At the end of the day, they are the ones who get the customer to give up their money for the company’s product or service.  They are the ones who are face-to-face with the customer earning the money that pays your wages.  The sales force needs to be supported by the whole company, even if they do put you in an uncompromising position with a customer. 

 

The size of the sales force greatly depends on the way the department is organized.  In its simplest terms, you can keep on hiring until the last sales person does not produce more in sales than they earn.  However, there is more to consider than just that simple philosophy. 

 

Sales management can organize the sales force either by geographical divisions, who are fully responsible for their region, product specialists, who will only work with customers on the specialized products they know, or VIP customers, who need extra special attention because the sales person “understands their business.”  You can hire less sales people by organizing the sales force geographically, but they might not be as knowledgeable about all of the products offered.  You can hire product specialists who will be able to be experts on all products, but more staff will be needed.  It is up to sales management on how best to organize their sales force.  The main goal is to have a sales force that can give the attention needed to each possible prospect and customer.  Regular sales calls, or “coverage,” need to be made in order to keep the customer from feeling neglected.

 

Good sales training is imperative.  In many cases, a sales person is given some brochures, taken on a sales call, and then expected to be an expert.  This is not the best scenario.  Sales volume will increase when a sales person has excellent knowledge of the product and how their company functions.  It also greatly helps customer service in that they do not have to explain how “something that was promised by sales can’t be delivered.”  First-rate sales people can answer virtually every question about the product they sell.  They will also know how the product stands up to the competition.  Product knowledge is essential, especially if the sales person is a product specialist.  It is sometimes harder for a sales person who is geographically based because they have to be a “jack of all trades.” 

 

The best way to motivate the sales force is through compensation.  Sales are usually paid in the following three ways:

 

  1. Straight Commission, which means they get a certain percentage of each sale they make.  They do not get any salary; they are only paid on a commission basis.  This is motivating when sales are good, but depressing and very un-motivating when sales are bad.

 

  1. Straight Salary, which means they only get paid salary with no commission based on a percentage of sales.  This is the easiest to administrate, but is not very motivating.

 

  1. Salary Plus Commission, which means they get both a base salary and a commission based on a percentage of sales.   This is the best for motivating, but hard to administrate.

 

Other ways to motivate are through sales quotas in which the sales person has to hit a certain level of sales made, and income generated.  Sales quotas work well because higher commissions and bonuses are tied to quotas.  The other motivating factor of hitting a sales quota is justification for the sales person to keep their job.  If they continually miss the mark, they will most likely be let go.

 

Presidential awards, company retreats, sales events, and monetary or vacation grand prizes are also good motivational tools for the sales force.  At the end of the day, however, it really is mostly about the money.  A promotion to sales management might be motivating, however, most sales people do not make good managers.  They like to depend on themselves, not others.

 

 

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