Hiring first company salesman: need advice

[Steve Pikes Tree Care]

called TCIA yesterday, and, as incredibly helpful as Tom Dunn is, even he was kind of stumped. We are hiring our first salesman in the company and I was curious if there was an average amount of sales that one salesman could be reasonably expected to sell and service. The last data that TCIA put out in their sample sales contract information was from the mid 90s. Back then, they stated that a reasonable expectation for one sales person was around $300,000-$350,000 in sales per year. We are in a very small rural market so our margins are much less then the larger metropolitan companies are but I'm still curious what a 2017 estimate would be. Any ideas? Also, we are going to go with a salary plus commission on gross compensation plan. Any ideas on compensation?

 

[AGoodSteward]

If the new hire is to be your sales dept. Then they should be expected to at minimum match your 2016 numbers. In addition you want them to cover the salary that you added to your payroll. Above that would be bonus land. Break it down by month and quarter to account for lulls and peaks. Congratulations on your success, and welcome.

 

[Steve Pikes Tree Care]

That's great advice, the problem is, as an owner, I've been working seven day work weeks 90 to 100 hours on average for the last decade. I don't mind it one bit, I'm wired that way. But, I certainly don't expect any of my employees to be the same kind of insane. So, while I might be able to run an entire company, six full-time crews, a management team, office staff, and do a million dollars a year in sales. I'm not sure if it is unrealistic to expect the average salesman in the industry to be able to sell, service, and do all of the work that it takes to organize the crews and the jobs for a million in sales a year. Maybe another question would be, how many 2 to 4 man crews can one salesman be expected to sell for with the understanding that he will also be partially responsible for helping the production management team organize the daily work.

 

[ChoppyChoppy]

I hear you on the long hours, same way here.

I was told by an "ex-spurt" a few days ago that if a person can't make a successful business working no more than 40hrs a week, its not worth it.

I just laughed.

 

[Steve Pikes Tree Care]

LOL, I always just tell them they must be smarter than me.

 

[Tenderfoot]

That's great advice, the problem is, as an owner, I've been working seven day work weeks 90 to 100 hours on average for the last decade. I don't mind it one bit, I'm wired that way. But, I certainly don't expect any of my employees to be the same kind of insane. So, while I might be able to run an entire company, six full-time crews, a management team, office staff, and do a million dollars a year in sales. I'm not sure if it is unrealistic to expect the average salesman in the industry to be able to sell, service, and do all of the work that it takes to organize the crews and the jobs for a million in sales a year. Maybe another question would be, how many 2 to 4 man crews can one salesman be expected to sell for with the understanding that he will also be partially responsible for helping the production management team organize the daily work.

It sounds to me you need a very personable fellow who knows the bussiness and has experiance. Maybe a washed up climber local to you? They would know the area as well and understand what the job entails. Personally, I think one man working a 40 hr week could probably keep 3 crews busy (in my area) if all they do is sell and check on jobs.

 

[Steve Pikes Tree Care]

That last part about keeping three crews busy was kind of my feeling too. I should probably focus more on how many crews can one salesman keep busy then what the dollar amount attached to that is. That will work itself out. The earlier post about monitoring the ebbs and flows of sales by month and quarter is obviously excellent advice as well. That is actually a very simple part of the business due to the fact that we use Arbor Gold Sprout as our primary software system. It allows me to have instant access to all of our sales records in real time by day, week, month, etc. I'm not sure about the washed up climber suggestion though, of course I thought about that, but I tell my guys that sales is just as specialized an occupation as professional tree climbing, requiring thousands of hours of practice, specialized training, and good personality as opposed to athleticism. In our area, washed up tree climbers often times are just that. Don't get me wrong, I love them! But like is attracted to like, and we tend to market high-end. So I find that most of our clients tend to relate better to a person who is more comfortable in wingtips than work boots. I'm leaning more towards hiring a professional salesman and teaching them arboriculture, then I am hiring a person familiar with arboriculture and trying to teach them all the nuances of sales.

 

[Tenderfoot]

Both options you proposed going to be equally hard to get done. A forestry grad may be another option, a huge issue will be them under or over bidding the jobs. Hard to bid things like tree work if you do not know the ropes, so to speak.

This is just my experience, but I do a lot of business at houses that are $5 million+. The crazy rich want you to be the help. Well mannered, but they do not want anyone who may be as smart as them, want you to know your place in the food chain. What do your clients expect? Figure that out and provide them that or groom the salesperson to be that.

 

[gorman]

called TCIA yesterday, and, as incredibly helpful as Tom Dunn is, even he was kind of stumped. We are hiring our first salesman in the company and I was curious if there was an average amount of sales that one salesman could be reasonably expected to sell and service. The last data that TCIA put out in their sample sales contract information was from the mid 90s. Back then, they stated that a reasonable expectation for one sales person was around $300,000-$350,000 in sales per year. We are in a very small rural market so our margins are much less then the larger metropolitan companies are but I'm still curious what a 2017 estimate would be. Any ideas? Also, we are going to go with a salary plus commission on gross compensation plan. Any ideas on compensation?

I'd say that figure is very low. If you have a salesman bidding ten jobs a day and you get half of them you should push past that mark in a four months give or take.

I would recommend getting a seasoned tree guy who knows what the work is worth and doesn't want to swing a saw or spray anymore. If you get a car salesman you can expect a shock to your company in the first month.

 

[jefflovstrom]

Three million a year,,just do it,,
Jeff

 

[jefflovstrom]

Anyway, it is based on 'man-hours',
What do you want to make per man hour over what you know what your market can handle,
You need a foreman who has passion and 'get's it',
Your salesman needs to meet the crew and hang a few days with them,
His bid's would be better,
Jeff

 

[BC WetCoast]

The salesman needs to understand how the job will be done, where the truck should be placed, what can be reached with a lift, what needs to be climbed etc. Tough for a sales guy who has never done tree work to understand.

 

[BuckmasterStumpGrinding]

I would go meet all the competition. You might find a small competitor that fits the bill and would be willing to shut up shop for the right price.

 

[Steve Pikes Tree Care]

That's a really interesting concept, in our case I don't think it would work, because we don't really have any competition. We put them out of business years ago so we do 85 to 90% of all the tree work within a 40 mile radius. I know that makes our situation really unique, but I would be really interested to hear if anyone else has ever tried something like that and if it worked?

 

[BuckmasterStumpGrinding]

Put an advertisement up in the employment forum.