But the increase in productivity is the most powerful benefit. It is not at all unusual to see productivity gains of 30% in the first year sales representatives are given a choice of compensation plans.
There are six heuristics that are recognized as being widely used in our daily lives, and a lot of them are relevant here…
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To help determine a company's true profitability, here are the first three questions we ask brokers:
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.
View each sales associate as if he or she were an individual company. (Your firm as a whole is then like a big conglomerate.)
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.
Is your business all hat and no cattle? In other words, are you focusing on increasing revenue at the expense of profit?
