Considerations for Entrepreneurs when Hiring a Salesperson

by Ben Lai | Sep 8, 2016

When a business begins earning enough revenue to hire employees, the decision to hire a salesperson can be a difficult one. The biggest question for the director is “will this person sell much more than what we’re paying them?” Today’s article will provide you just a few considerations when defining and hiring a salesperson.

Hiring a Salesperson Consideration #1: Ramp-Up Time

Even if you hire an experienced salesperson, there will always be “ramp-up time.” This describes the time it takes for them to start producing sales in excess of their pay. This can take anywhere between a month to a year. Some questions you might want to ask the candidate include:

Are they already networked in the industry?
Do they have experience selling a similar product?
How many hours/week will they work? (Full-time is ideal)

Finally you’ll need to ask yourself: “Can the business afford for the salesperson to have ramp-up time?”

Hiring a Salesperson Consideration #2: Remuneration

When hiring a salesperson, it is critical to get the remuneration plan right to maximise motivation and to reward the right behaviours. Here are three combinations to consider:

Commission only: The idea of only paying for results is great for the business. However, this can be less appealing for the salesperson. This structure may eliminate many candidates initially. However, if you are fortunate enough to find salespeople willing to work on this structure, they are usually the type of person who is genuinely confident in their ability to be successful.

Base plus commission: This is the most common remuneration plan. This is because it strikes a good balance of risk and reward for company and employee.

Base only. This is the least common package. Because it doesn’t provide monetary incentives for increased performance, it has its own challenges. For this plan to work, you will need to find candidates who are willing to work hard simply because they believe in your business’ cause. This structure doesn’t incentivise unethical practices like commission can. However, it can conversely lead to apathy.

The ultimate questions for you are: “What kind of person do I want to attract?” And, “How do I incentivise the right behaviours?”

Hiring a Salesperson Consideration #3: Self-Motivation

Is the candidate self-motivated? Does the person have a major life goal? Do they see their job as a career or calling? How have they engaged in self-development? These questions will help determine if the person will work autonomously. Sales can be emotionally draining. This also applies to those who love the profession. A great deal of self-motivation and support from you as the owner will help keep them performing at their best.

What is their explanatory style? Do they tend to blame external circumstances for their lack of performance? Or, do they take personal responsibility? This factor alone saw MetLife’s revenue soar and turnover rates plummet for its insurance salespeople. To look at the study and sample questions, check out the article from ResearchGate.

Now ask yourself: “If left unsupervised, will this candidate work autonomously?”

Conclusion

When deciding whether or not to hire a salesperson, you need to take into account their ramp-up time, remuneration plan, and self-motivation. Because I like to keep my blog posts short & sweet, I wasn’t able to elaborate further on the above factors, and have left out numerous other considerations. I intend on creating a full guide in the near future, so please email me if you want a copy. In the meantime, feel free to post questions below!

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What to Look For When Recruiting Salespeople Pt 1

Pt 2: What to Look For in a Sales Candidate

What to Look For When Hiring Salespeople Pt 3