For those of you who currently are or who strive to be more than a one-man operation, who here has a full-time sales rep? As a former FISH Operations Manager, I can attest that this is how they grow their business so quickly after opening a franchise location. The sales rep hits the streets full-time and the owner also spends a fair amount of time cold calling. How many of you are already doing this?
[MENTION=38401]BuffaloBillsFan[/MENTION]
Welcome to WCR.
I’ll probably hire a sales rep later next year depending on my growth. If you have a good cash reserve then follow the system you learned. Hire a couple of cleaners, hit the streets hard and blow it up. If you have say, 20-30k to put into it, then you can probably follow their system. You’ll bleed cash for a little bit depending on your territory, but you’ll be able to grow it pretty quickly.
But if you’re on a shoestring, go out and do it yourself, establish routes, establish your brand, then hire a cleaner. Then another. By the time you have a couple of cleaners, you turn yourself into a sales person. By the time you have 3-4 cleaners, hire a sales person and you manage the operation.
Their system is based on the book “The E-Myth” by Michael Gerber.
I’m reading the E myth now. Hopefully it helps. Well see. I’m always up to learn how to better my business.
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So how does Fish’s sales rep get paid, hrly or %, or a combination of both?
Some systems are usually 10% of the yearly worth. Paid out incrementally over 3 months.
So a $20 job 1x2 is worth 520 over the year. The commission is 52 paid out over three payments. This supposedly protects against one time cleans. But you can still lose money depending on the job.
However all the franchises I’ve talked to have a hard time finding and keeping salesmen. So everybody does it different regardless of the franchise system.
I’m still working on my pay scale but I’m leaning towards 10% of each job each clean with residuals for up to 2 years. This would keep them selling and force then to take ownership of that customer and make sure they’re happy. The residuals are only good while they’re with me.
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Thanks for your input Jared.
In regards to residuals what kind of % are you entertaining.
10% of a sale does not seem like much for a sales person. I’m leaning towards 20-30% per sale. I’m primarily residential so if a job is 200.00 all they would earn is $20 at 10%. One would have to work very hard to make any money at that rate. I’d like to pay more so I can keep my sales person. I’m new to hiring sales people so any advise would be helpful.
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I’m thinking 10%. Sell a $20 job, get $2 every time we clean it. If you sell it weekly, you get paid weekly and it applies for both commercial and residential.
I’ll have to float the salesperson for a little bit while they get the pipeline full, but I think it could be a very good payscale and keep them motivated.
The problem with franchise systems is that the salespeople don’t get any residuals which works out great for the owner. That’s why a lot of owners can’t keep salespeople.
I believe a good salesperson has a max lifespan of about 2 years before they go on to the next job. It’s rare to find one that wants to stay in one place. When a salesperson leaves, I’ll keep the customer and the residuals.
By giving them residuals, they have an interest in the customer having a good experience and getting good service. Especially on residential. On commercial, it gives them an excuse to go back and maybe upsell them on something else “I notice you have a lot of mirrors, we could certainly clean those and it would only add $10…”
I’m still working all this out because I want my people, all my people, to make good money. Good money = happy people = happy me. I want my guys motivated to say “hey, let me get that for you” or whatever it takes to create a raving customer base.
For the employees, I’m leaning towards a cash system (in a franchise, they get paid the same as the salespeople). If a cleaner sells a new job, on the 3rd clean they get 100% of the job. Sell a $20 storefront, we clean it 3 times and I’ll hand them 20 bucks. Sell a $50 restaurant, I’ll hand them 50 bucks. I’m convinced that they’re more motivated by cash in hand than some percentage system as a line item on a check.
It depends on who you find valuable. If you have employees, payroll will probably be around 30%, then your salesperson gets 20-30%, then your overhead runs 20-30%, and you’ll be paying yourself 10%. So for every dollar you make you’ll take home a dime.
Personally, I’d rather take home 25-30% for myself. This is my business, my retirement, and my dream. Cleaners will come and go, salespersons will come and go, but I’ve got to put up with all the headache of running a business and managing employees.
No, a sales commission of 10% by itself doesn’t seem like much. However, you stack on commissions from 10-20 new businesses a week, a few houses, AND residuals, I think the salesperson can be making a pretty nice salary within a few months.
I’ve only heard of one really good franchised salesperson. His record was 1100 new sales in a year. I think 500 new customers per year is absolutely doable.
But all this is pretty academic until I decide exactly how I want to run my business. The franchise model is to go big. Do I want to be the biggest or do I want to be the premium high end residential company?
If I want to be the biggest, 500 new accounts per year will do it and the salesperson will be happy.
If I want to be high end, then 200 new accounts per year will do it. But I’ll have more margin to pay a salesperson more.
For now I think I’ve settled on going big and once I’m established, I can easily raise prices and migrate towards high end stuff. Big chain restaurants, big houses, etc.
I don’t have any employees. I’m just looking for a person who can generate sales for me. Mostly residential and some large dealerships and commercial accounts. He sells I do the work. I’m leaving the storefronts to bucket bob and fish. I’m too busy to clean windows and makes sales anymore.
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daaaang. the math/paperwork on a system like that seems like a job in itself. have you factored in the cost of your time or an admin’s to keep up with all that accounting?
Jared I like the way you broke it down…
The reason i was asking what/how sales people were paid (%-hrly). I getting to the point that I’m entertain the thought of hiring a sales person for a short time 6mth/1yr.
Im to the point (almost) that I’m wearing to many hat’s. I would like to increase my business by about 15-20% and fill my schedule.
I want to keep the “solo guy” effect. I’m not looking for “world domination” effect.
So i guess what I’m saying, what do you guys think would be a good direction to go with a sales person for (route/small commercial).
steve, if i was in your spot here’s what i would do: find the best salesman you can in your town- used car, cable tv, vacuum, magazine subscription, whatever. and just have him moonlight for you for a few months. work saturdays and evenings, for a straight 50% of the ticket for first time service. quick and dirty like.
you could probably build up your clientele quick, and you’ve got the chops to turn those new clients into long-term repeat biz. then you aren’t hooking yourself into an employee-type situation. more like a sales merc, if you know what i’m sayin.
Humm, that would be a tough situation for a salesperson. If he goes out and kills it you’d be screwed to try and get everything done.
I plan on hiring a few employees before I bring on a salesperson. If you had a couple of employees, you become the salesman.
Naw, that’s the beauty of my plan: sell something get 10%. Simple. Every time it comes up, 10%.
But I’ll admit I’m still feeling this one out. The cleaner commission is well understood, but salespeople are like some sort of weird species. The franchise didn’t really have a good system so I’m just trying to figure out something that will motivate someone to go out and get it done. I would absolutely love it if someone who has retained a good salesperson would tell me how they did it. Because I honestly have no idea.
Humm, in your situation Caleb had a great solution. Hire a part timer (I’m going to advertise for stay at home moms/dads - drop the kids off at school, bid from 10-2).
Or you could pay them 10% of what it makes you over the year. But space it over 3 payments (50%, 25%, 25%) and that way if you get a new route customer and they drop you after a couple of weeks, you’re not out the whole commission.
How many employees do you have? You could just encourage them to start bidding. Give them 100% on the 3rd clean and you might be able to get that 15-20% bump without having another mouth to feed.
Thanks Caleb…That’s why i dig this forum. That is a great idea!!
it happens occasionally. my life’s maxim is “keep flinging poo, some of it will eventually stick to the wall.”
So is he getting an hourly rate plus commission ? Or just commission ?
I think a 10% commission rate works well if they get some hourly pay . If you plan on doing just commission then you have to give more percentage (hence 30%). The residuals work well to guarantee a long term employee .
If one pays 30% commission , the only way it’s going to work if the jobs are priced really well.
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Jared I’m solo in the field, besides the help of my son on large projects during his breaks from College.
Thanks for your input.
I think I’m going to run with Caleb’s idea [COLOR=“#0000FF”]“for a straight 50% of the ticket for first time service. quick and dirty like”[/COLOR]“[COLOR=”#0000FF"]“then you aren’t hooking yourself into an employee-type situation. more like a sales merc, if you know what i’m sayin” [/COLOR]
for now it just seems to fit my situation.
