Commoditization is the process that transforms a profitable, differentiated product or service into a commodity.
The following tips can help you design compensation packages that will motivate your sales force managers most effectively.
When you follow this five-step process, you can design a compensation strategy that supports your business plan, positions your company successfully against competitors, and allows you to recruit and retain the sales force you need.
No matter how generous the plans are, representatives are going to feel that "the other guys have a better deal."
View each sales associate as if he or she were an individual company. (Your firm as a whole is then like a big conglomerate.)
See how much you know about sales force compensation – take the following 10- question quiz. Answers are given at the end... if you have any questions please contact us!
Don't be intimidated if you pay less. Three-quarters of the time, sales associates leave a company for reasons other than money. Explain your value proposition; stress the services that you offer and the strengths of your firm.
In our work with hundreds of sales organizations, we see many making the same mistakes with regard to their top producers. To keep from losing your best sales reps, here's how to avoid these common pitfalls.
But we are also seeing companies succeeding, despite market fluctuations. Companies buying up other firms, recruiting top producers away from weaker competitors – companies that are growing rapidly.
One of the issues we discuss often with managers is why offering a choice of compensation plans is such a smart strategic move for the business, especially in this market. Here is what we tell them...