Is It Time To Hire My First Sales Person?

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Author and Sales Trainer, Tom Hopkins contends that “the majority of small businesses fail in their first five years, not because of the product or service, not because of poor accounting practices, but from lack of sales.”

I regularly meet with business owners who have created a great niche business manufacturing an innovative new product or developing a unique service. The owner is usually wears many different hats. They are the product developer, production manager, and the head of accounting, marketing and sales. I call them the COE (Chief of Everything) for short. This role works for a while but as they become more successful the company begins to outgrow the owner’s personal resources, mainly time and energy. Once this occurs it becomes difficult for the COE to personally be the driver of all aspects of their business.

The Tipping Point

At some point the successful business owner will realize they can no longer keep up the pace of running everything and it’s time to start hiring qualified people to take over more aspects of the operation. Most often they look to hire a full time sales representative. The question I most often get asked is; “how do I know when I should be hiring a full time sales person for the company.”

Here are 7 questions you need to consider before you make your decision

1. How much of your time is actually spent selling your product or service?
2. How much do you currently sell each month or quarter?
3. What is the profit margin?
4. Do you want to be the company sales person or is it time to hire one?
5. How much revenue do you calculate a dedicated sales person could sell in the next year?
6. Do you have the time, resources and expertise to hire, train and manager a sales person?
7. How long can you afford to pay a sales rep’s salary before they become self-sufficient?

Set a realistic goal. I often see people pull out the crystal ball and predict that a sales person will sell an incredible amount of product in the first 90 days. Unfortunately, the sales target far exceeds anything the company has ever done. Look at your best 3 or 4 months over the past year and use that as a starting point for your sales goals. If you sell a product with a long learning curve or long buying cycle then don’t expect a new sales person to miraculously start exceeding their targets in a few short weeks or months.

Help Me Understand Sales Compensation

For more information on designing simple but effective sales compensations plans pick up a copy of the B2B Sales Connections training program, Action Plan for Sales Management Success. It contains a full program that can help you get started. If you need more information on how to set up your first sales compensation program check out Brian Jeffrey’s’ eBook “Simplified Compensations Plans that Work – Feeding the Tigers”

What’s the fastest way to make a new sales person profitable?

Studies show that companies with a defined sales process consistently outperform those with no process. The money you spend up front to have the right sales process and hiring process in place will result in a better hiring decision and a sales person who will be producing revenue faster. After all are you looking for a someone that will take 6 month to a year to start selling or someone who can close business right out of the gate?

AIM HIGHER !

Robert J. Weese, B2B Sales Coach & Author

www.B2BSalesConnections.com

Do you want to learn how to work with Independent Sales Agents to grow your business?  Check out my book How To Find, Recruit and Manage Independent Sales Agents.

As one reader said, “If you are looking for a comprehensive guidebook that can help you find, train and manage independent sales agents (ISA’s), then this book is for you. I guarantee it will help you achieve your goals by giving you a step by step process for developing a successful sales agent program.”

“I love the B2B Sales Connections website. It’s an amazing resource for anyone involved in B2B selling.”

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