June 2019 Submissions

So you lost half your sales force but can’t pay the ones who have stayed and are exceeding their goals to take on more accounts? Sounds like a management problem.

Nick A
Nelson, MN

Honestly, I think I have seen it. You pay for high horsepower that can and will produce but with that said, high horsepower also identifies your vulnerability in this and many other similar situations. The true answer lies in what you are willing to give to still meet the ultimate goal. Do you stomp your feet and say no?! It’s a rock and hard place deal that can only be accomplished by the most senior (experienced) manager who is either willing to justify the expense as opposed to the loss. Or maybe is able to leverage their ability to accommodate/accomplish the final goal by creating a new goal/incentive that entices them to achieve what you are asking. Just my 2 cents.

Gary R
Amarillo, TX

Why did the other 2 leave? Can you effectively service your existing accounts with the 2 salespeople who remain or do you need to backfill the other 2 roles? If you need to backfill: how long will it take to find a qualified candidate? How much will you have to pay them? How fast can they learn the lines you carry? Will your customers follow you through a turnover in the sales force? Are the deals there but you’re not winning them? Are you losing them because there’s not enough time and the other 2 are spread too thin? Is the market down? Are you compensating your sales staff for the parts and service business they bring through the door?

There’s not enough information to give an opinion. You, as the dealer principal, have the power to change things. I don’t think you can “overpay” a good salesperson, you just have to structure your pay plan accordingly. If they make 100k, you make 300k after they’re paid. One thing I can share is a virtual truth among salespeople: the good ones are motivated, at least in part, by money. They stay because of the culture you create.

You said your business isn’t doing as well as you’d like and can’t afford additional compensation for the 2 who remain. Can you afford to lose them?

Chad K
Sioux Falls, SD

I would think that investing into proven salespeople is only good for your business. However, you must maintain control of your employees and not let them control you. Perhaps provide them with an opportunity to prove they can handle additional workload and when they hit a certain target then they receive an increase somewhere or a bonus. If you were paying 4 people and now paying 2 there should be funds to make that work. Maybe I’m oversimplifying it.

Chris B
Norfolk, NE

Build the additional commission program around the situation. Any increased sales over their goal volume over and above current expectations pay a higher commission % on for the remainder of the year. This should help cover the additional cost to the business without taking the business into a tail spin. They get something and the business gets more volume. If you run it to the end of the year that gives time to get another salesman hired to replace the one that quit and hopefully get the business out of what the salesman considers a muddy situation.

Mike F
Three Rivers, MI

Reward them the increased commission if the increase in sales (or performance) warrants the increase.

Troy J
Elbow Lake, MN

Give them a pay raise. They are working hard and deserve it.

Duncan R
Cambridge, NZ

You lay out a good and unfortunately a not unusual situation. My suggestion would be to sit each salesperson down individually. Review their performance, but then explain the dealership needs and financial requirements (financial budgets). This probably will not alone convince them to stay with what they are getting. So, up the ante and bring them into the financial risk/reward of the dealership. Beyond their salary/draw and commission, offer them an incentive based on your market share attainments, your net profits in the sales department and your level of aged used equipment. While these three incentive categories require some transparency and solid/ consistent reports, it also gets them to help you as dealer principle to manage areas that are very important to your success. Downside could be that it might be more than a one-year project once it gets started.

George K
Charlottesville, VA