-by Scoop (December 01, 2017)
mong the e-mails I received this past week one was from a rep new to our industry. Prior to being hired to peddle slices of paradise this individual did not have a sales background and has now been working on a sales line as a front-end rep the past few months.
So Here’s The Scoop: While snooping around online & seeking some timeshare sales training courses this person told me they discovered InsideTheGate.Com (ITG) and since then they’ve become “…an avid daily reader…’ – including my weekly column.
When marketing/sales reps contact me, at least those new to ‘the biz’, earnings (commissions) seems to be one of the topics they are always interested in and/or seeking more information about as was the case with the individual reference herein.
In a nutshell my new friend asked if the percentage they were being paid per sale was competitive and if it wasn’t what should they be paid and – a bit more precarious – how would, or should, they go about asking the ‘developer’ for what can only be described as a raise (aka: an increase in the %).
In this instance the developer in question classifies their sales-reps as employees and the company provides their reps a complete employee benefits package as well a very attractive commission structure, spiffs and other production bonuses.
So, with a caveat or two I responded by including what I call the 100-tour story, adding that this person, as do all reps, must analyze the big picture before making any decision regarding their work. Oh, and I also mentioned that in terms of the % paid – worldwide – uniformity is nonexistent in the Land of Time.
I also told my new acquaintance that the 100-tour story really only applies when working with developers on a commissions-only basis, because without any benefits such as paid sick leave, paid vacation time, life & medical insurance plus a retirement plan, etc., commission-only ‘reps’, IMPO, are being royally duped unless they’re paid a yuuge ‘cut’ (%) of the action.
I added that developers who offer a commission-only environment usually have the worst sales guest ‘qualifications’ such as income requirements and many of those developers actually pay fewer ‘points’ (%) than do developers with much higher sales guest qualifications who also provide a full range of critically important employee benefits for their sales peeps’ security, peace of mind and their families’ futures, etc.
More on that in an upcoming column – but for today, for those so interested, here’s the condensed version of what I call the 100-tour story.
Two reps are working for the same developer; both are either a liner, a T/O (closer) or F/B’er (front to backer) – it matters not.
Both reps, each & every time, sell the same $12,500.00 (USD) ‘vacation-plan’.
Both reps will ‘pitch’ 100 qualified tours over the same period of time.
Rep ‘A’ closes (net) 15% of their 100 tours; rep ‘B’ closes 30% (net) of their 100 tours.
The developer has a fixed marketing cost per qualified tour (sales guest).
The commissions (%) paid, be it a liner/TO (split) or a F/B’er totals (e.g.) 10%.
In the time period it takes to ‘pitch’ those 100 tours rep ‘B’ (30% net closing ratio) will earn $18,750 more than rep ‘A’ (15% net closing ratio).
At the end of the day, when the marketing costs are deducted plus the extra earning’s rep ‘B’ is paid – and even excluding the additional revenue the developer will receive in the form of interest payments & annual maintenance fees etc. because rep ‘B’ sold more sales guests than did rep ‘A’ – rep ‘B’ still puts more dollars into the company coffers ‘pitching’ the same number of qualified sales guests as does rep ‘A’.
Moral To The 100 Tour Story?
If a ‘rep’ – in the commission-only universe – generates a net closing ratio (CR) notably higher than other reps in the same sales center who are also ‘meeting/greeting/selling/closing’ the same number of ‘Q’s’ – then said rep(s) with a much higher CR, etc. should be paid some sort of an additional bonus.
Back in the “old days” one such modest bonus was a ‘ride-on-the-room’ – but more on that sweet little SPIFF some other day.
Good Luck Out There
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