Josh Melick has recently penned a brilliant piece of content on his blog regarding how sales-based companies can set cup a high quality sales comp plan for their teams. Josh goes into the need for paying on time, setting up different rates for trainee staff and adding accelerators for high performing staff. These are just some of the key points which Josh talks about in the piece, which I would urge anyone in this industry to read, and pay attention to.
There is a very real need for what Josh is suggesting, because the risks which are associated with having a poor sales comp plan are very real for businesses. If your sales comp plan is not good enough, here are the dangers which you could easily run into.
Lower Sales From The Team
The whole idea of a sales comp plan is to incentivize and motivate the team by dangling the carrot of higher wages in front of them. If however you are not able to pay the staff on time, or you are offering a poor level of rewards, this is not going to be the case. The biggest risk that you run here then is having a sales team which is not motivated and which do not deliver the results which the business is looking for. Simply put, if you get this wrong, you can expect to make less money in the business.
Discontent in the Workplace
A harmonious workplace is essential for driving healthy competition amongst your staff and bringing in more sales. This is exactly what a sales compl plan can do for the business, but only if it is well implemented. If you do not achieve this then you will find that you have issues amongst the staff which can very quickly spread. It is critical that you are always trying to find ways to keep your staff motivated and happy, a failure to design a well thought out sales comp plan will certainly ensure that the opposite happens with your workforce.
Most people who are good working in sales can work in just about any sector, because it is their ability to sell which makes them so attractive to other employers. If a sales member knows their worth and you are not delivering on it, they can easily find another company to work in. This happens anyway in this business but it will be accelerated if you are not delivering a quality sales comp plan for your employees. If this is the case then all you are going to do is inspire your team members to seek another company to work for, where they will be paid what they believe they are worth and where they will be paid on time.
Read the piece by Josh and you will see exactly how easy it is to set up an efficient and functional sales comp plan for your employees, which will remove the dangers which we have listed here.