By David J. Cocks, CEO
Here at CM Global Partners, using our proprietary software CompensationMaster, we have a unique view into sales force compensation industries – we work with companies around the world, helping them restructure their businesses and design (and implement) new commission structures that ensure financial stability. We know how thin profit margins are for most companies. And we know how hard business owners are working to keep their companies afloat.
It is deeply troubling to see so many businesses going under, being bought for almost nothing – sometimes just 20 cents on the dollar – seeing dreams and livelihoods disappear overnight.
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.
Here's what you can do to copy those companies...
Let go of entitlements
If you are giving your sales force splits that are not justified, you need to STOP. It is a mistake to give sales people a higher commission just because they have been with the company for a long time, when their production does not justify that split. They might be the nicest people in the world, but as much as we all would sometimes like to, we cannot run a business by giving more to people just because we like them.
Stop driving from the top – listen to your sales force!
You need to figure out who you are in today's changing environment. Ask your sales people what they want and listen to what they are telling you. Then take action, even if it is painful.
Get rid of bricks and mortar
We are seeing companies around the world let go of bricks and mortar. You still need storefronts, but do you need all of them? Walk through the offices in each of your branches. How many people are there? Almost every company can get by with significantly less space than they have. And since this is probably your biggest expense after commissions, this is a perfect place to look for savings.
Time and time again when we restructure a company, we are seeing that it makes sense to close branches and create drop-in centers where sales staff have flex-based desks. Since so many people work from home now, this works for them.
Consolidate administrative staff – use technology
Creating support centers lets you centralize your administrative staff. Then you can use technology to provide better service to your sales people and clients at a lower cost.
For example, we are seeing companies provide high-tech touch screens in their storefronts. Clients can touch the screen, push a button, or make a call to reach a call center that immediately sends them information and notifies the appropriate sales person instantly via their smartphone. Sales people love this and it costs less than you would expect.
Sales representatives are looking for companies that can provide the opportunity to earn a living. If you can cut costs by reducing the amount you spend on things the sales force doesn't value, you can turn that savings into increased commissions, making you much more competitive in your market.
Top producers are looking for stability – like everyone else. Make your business the one in your market that delivers what they want, and this will turn into the best opportunity to recruit that you have ever seen.
Change is necessary
Very few people embrace change. It is always going to be easier to try to hold on to things as they are, and hope the green pasture days come back soon. But the companies that are going to find the greenest pastures are the ones who leap into this new environment with both feet.