Question

Topic: Strategy

How To Split Commissions Among Retail Sales People

Posted by ziczacxann21 on 2/27/2012 at 1:50 AM ET 125 Points
i have 3 retail sales staff in my shop. One of them is a super sales man, he is quick to grab anyone that walks into the shop and he is excellent in convincing anyone to buy our product.

The other 2 sales staffs are moderate, they are quite new, they try their best to sell and the result is not too bad for a new comer.

However the super sales man has been grabbing almost every customer that walks into the shop. The other 2 sales staff therefore do not have a chance to talk to the customer.

How should I set the commission plan so that the 3 sales staff are compensated fairly?

Currently the super sales man has the higest salary coz he worked with us longer than the other 2.

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RESPONSES

  • Posted by Harry Hallman on 2/27/2012 at 7:55 AM Member
    Why do you want to change anything? The super salesperson sets and example for the other two and the money he makes is the others benchmark.

    If you have enough business for three people they all should be able to do well in the future.
  • Posted by CarolBlaha on 2/27/2012 at 9:18 AM Accepted
    I would make whatever commission plan you have constant and equal for all 3. Right now the guy grabbing all the sales could be a de-motivator and doesn't insprire the staff to try harder or perfect their skill.

    Making the comp plan equal might inspire the other two to get more energy to grab those sales, and improve their closing ratio.

    The person with the longest tenure should be at a higher salary than the rest. Its to be expected.
  • Posted on 2/27/2012 at 11:05 AM Member
    There should be no commission split, why give money to a person that did nothing to receive it. That would not be fair to the hard worker.

    If you want the new sales people to get more chances with customers, then you make up an alternating walk in rule for the salesmen.

    i.e. salesman one gets the first customer in the door, salesman two gets the second customer, etc. etc. and just repeat.

    Everyone gets a fair chance. But, if your new people can't close a deal, you must be prepared to lose some sales because your heavy hitter will not be taking up their slack.
  • Posted by ziczacxann21 on 2/27/2012 at 11:41 AM Author
    Thanks for the response.
    I made it clear to all the sales people that they have to take turns to serve each customer that walks into the shop. But the super sales man doesn't adhere to this. He grabs anyone that walks into the shop. When the other sales people is serving other customers or even almost closing a sale, he cuts in and tells the customer that his colleague isn't recommending the best item for the customer! He then tries to convince the customer to buy another item so that he can grab this sale.
    Now i plan to give each sales person equal percent based on the shop's total sales. And the guy who worked the longest has the highest basic salary.
    Any other comments/ suggestion would be appreciated.
  • Posted by ziczacxann21 on 2/27/2012 at 11:46 AM Author
    By the way, my shop sells high end products, we get about 10 pple walking into our shop each day on average. But maybe only 3 people will buy each day on average.
  • Posted by CarolBlaha on 2/27/2012 at 1:28 PM Accepted
    You need to sit that super guy down and tell him while you appreciate his committment, butting in like that is unprofessional and has to stop.

    I really don't like the fact you are essentially being backed into this situation because of his agressiveness. (not assertive, aggressive). And if I were one of the other two guys, I'd let superman do all the work, why not, I get paid for him doing it. You're about to go out on a very slippery slope.
  • Posted by ziczacxann21 on 2/27/2012 at 9:13 PM Author
    Thank u so much For taking the time and effort to respond.
    Really appreciate it.

    I have a feeling if i change the commission to be an equal split among all sales people, this super guy will lay back and relax...unless he feels that for any particular month, his colleagues can't hit the target then he will start working....

    I have talked to him about cutting in to catch his colleague's customer but he doesn't accept he's in the wrong. He feels he's recommending the best item for the customer. And he always use the excuse that this customer is his, because this customer came to see our product several times and he was the first to talk to this customer. Sigh! If he wants to define in that way, then i would say all customers belong to the company coz we invest heavily in advertisement to drive customers to the shop!


  • Posted by CarolBlaha on 2/28/2012 at 12:39 AM Accepted
    I see your logic, but I'm not sure you'll get the desired result. More likely he'll hate the plan and balk, even resign. If you pull in his reigns he'll balk and maybe resign. This is your business, you need to get back into control.

    Quite frankly, if only only commission plan was being paid me on the total sales of the group, I'd walk. Now I have been paid on a combo plan, my sales plus bonus on group sales. That would be a two tier system. But then, if I acted like super guy, I'd expect and would be terminated (after coaching of course) and I'd know I'd been pushing the envelope and I derserved it.
  • Posted by Gary Bloomer on 3/3/2012 at 4:16 PM Member
    Your "super salesman" might need reining in a little more, perhaps by cutting his hours—not his salary, just his hours.

    Were I one of the other sales people I'd walk. True, the customer is important. However, were I a customer in your store and I found your sales people effectively squabbling over which product is somehow "better" or as to who I, as the customer "belong" to, you'd lose my business and I wouldn't be shy about telling other people why I'd walked away either.

    As for the 30 percent that buy, how many more customers MIGHT you win if "Mr. Pushy" backed off? How much more might the other sales people respect him if he was to mentor each of them so as to provide a united sales force front? Yes, the old ABC "always be closing" rule is a good one, but not at the expense of team spirit and not at the expense of the loss of customers.

    The point here is this: there ought to be no selling, from anyone. There ought to be solid, compelling benefits outlined for the customer, there ought to be bold, imagined, desired outcomes presented to the customer. There's no "sales" pitch in either of these approaches and often, people who are "just looking" are chased away by sales people who don't know the difference between a sale and the acquisition of a customer. Sales walk out the door as one off events. Customers come back again and again. Which one do you want?

    Your super salesman may be meeting the need to rack up sales. What he may not be doing is reading the customer's mind, anticipating their desire, and exceeding the customer's expectations.
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