Economy Drives the Resurgence of the 'Commission Only' Sales Person

Everyone needs a reality check once in a while and the economy has made providers of technology and services to the travel and hospitality industry re-evaluate how they compensate their front line sales people.

Not long ago, top sales people were paid very high salaries along with strong compensation programs, but the downward pressure of the economy has substantially reduced those types of positions. Companies need to reinvigorate themselves along with their employees and a new way of compensation is one area to focus on. To have people fully engaged in the process of selling will enable companies to differentiate themselves in a struggling economy and help them reach escape velocity when times begin to get better.

There can be a great deal of upside related to commission only sales positions but, if considering developing such a position, one must weigh the pros with the cons. The commission only plan must adhere to your prospective employees strengths and their aspirations. You must make sure that your candidate is fully imbedded in the process and believes in the products and services they are selling. Also, make sure that your company will be able to support your salespeople through marketing and sales efforts. Sales support is of paramount importance for a commission only position, as it will enable your employees to close deals quickly and see the fruits of their labor.

When looking at a commission only sales initiative, make sure have the following in place:

• Availability of different income streams

• Make sure the individual sale amount has a large enough margin to implement a strong commission structure

• How long will it be before your employee starts seeing income?

• What is the average close ratio in your company?

• What support will be provided to your employee?

• What kind of training programs does your company offer?

This model will work for some people and not for others. It will also work for some companies and not for others, but because of the current economic climate, its time has come once again.

It will be extremely interesting to see how this develops over the coming months as the economy begins to see the odd glimmers of hope. Even though there is a light at the end of the tunnel too many metaphors too close together, things have changed and they have changed dramatically. The old way of doing things needs to be revisited and that includes how companies price, expose and sell their products along with how they compensate their employees.


Alan E Young is a Partner at Apical Resource Group LLC.

Apical Resource Group LLC. (ARG) is a wholly owned travel and hospitality technology, sales and marketing recruiting firm. Apical focuses on recruiting for mid-level to executive positions and offers a new and aggressive solutions model. For a complete overview or additional information about Apical, please contact an Apical Solutions Representative at 1-770-517-5580 or visit the Apical's Web Site at www.apicalresourcegroup.com.

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