Your sales-force is the leading driver of your company’s growth – or at least it should be. If you have a predictable, scalable system for growth, then you definitely have the ability to multiply your sales-force, expand into new markets, and increase sales to systematically grow your business. The challenge is that many C-Level executives attempt this process prematurely and scale their sales team without laying the proper foundation first. Multiplying bad behavior turns profits into losses. So what is the proper foundation? It starts with none other than the sales commission structure.
Great sales commission structures creates an internal motivation within your reps to continue to do more, be more, and sell more. But a commission structure set up poorly unintentionally lowers drive, creates either fear or complacency in your sales-person and results in dramatically lower sales. Can you imagine the repercussions in having a sales commission structure in place that is directly responsible for lowering sales and then multiplying that opportunity loss by hiring more sales-people to follow? This is why it’s important to have the correct structure before you think of hiring another sales-person.
It’s important to note that motivation is only part of the issue. A sales-person can be highly motivated, very hard working but still losing sales because they’re putting that energy in the wrong place. If the incentives are not structured a specific way, it leads to the sales-person getting results for the wrong behavior. We will show you exactly how to incentivize the employees to take the specific actions which will lead to the highest amount of sales!
As a matter of fact, throughout the years we have researched, interviewed, and spoken to thousands of executives at hundreds of different companies in the c-suite, mid-management positions, and their sales-people. Our mission has been to understand what the components to create the most effective sales commission structures are. We want to understand not only what produces the highest sales but also creates unity between the company and the sales-people so that everyone is moving in the same evolving direction super-fast!
In my lesson, 5 Considerations for Building an Effective Sales Commission Structure, you will learn the 5 core components of a highly effective sales commission structure. When we say ‘high effective; we mean that it:
- Reduces the risk to the company
- Creates a burning desire and drive in the sales-person
- Incentivizes the right things
- Aligns the interest between both parties
- Increases sales and revenue
Without this foundation, it will be dangerous to hire more people. As a matter of fact, after this lesson, I recommend that you revisit your current compensation plan and make the necessary adjustments so that your people are happier and your team’s performance is better. These principles apply to not just sales but to all people in all departments! Truth is that every employee you hire is an investment that you are making to become a better and more profitable company. You invest in their pay and in return they are to give you their time and energy. A highly effective compensation plan will maximize that return on your investment and will take your sales to the zenith.
About The Author
- George Athans
- CEO, MindStorm Strategic Consulting
- Growth Strategy
George Athan is a speaker, strategic consultant, and sales trainer that helps business owners all over the country rapidly grow their business. He has spent almost 20 years in sales, management, and business ownership.