Sales incentives, short term and long term.

ward said:
Why pay for this service when X,Y, Z down the road will give me an estimate for free?
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This is not unique to us. Look at the plumbing trade and others like it. Once upon a time they did free estimates. At some point though someone decided it was time to charge. They faced this problem until others realized they were better off charging than not.

It's like any other aspect of selling, it's about the value proposition. Why is it valuable to the customer? Answer that question and it'll become easier to get paid for the estimate.
 
Imagine it Nick ;) Sometimes being the salesman AND the owner creates perverse incentives.

Plumbers in Louisville give free estimates. Tree companies do too. So we do. Ultimately, your competitive environment sets the pressure. Giving free estimates isn't a big deal though. Use it as a way to meet and greet new people. Even if they don't use you, they'll remember you if you make a good impression.

A typical sales commission is 10%, with an expectation of $500,000 in gross sales. Always pay commission on the gross. What the owner does with the net is too different from year to year and easily manipulated. Keep it simple.

I also recommend a Base. That is, guarantee your sales staff a living wage, and pay commission over a certain goal. This is also a good protection during lean times. You don't want your employees wondering if they can pay their basic necessities or not!!
 
@JTSpear Are you dead set on the sales commission route? I hired someone for the sole purpose of generating me more leads so our guys could expand from our normal area. It worked nicely for us because everyone likes doing the work, but no one, including myself wanted to start making phone calls.
 
treeremovalALB said:
@JTSpear Are you dead set on the sales commission route? I hired someone for the sole purpose of generating me more leads so our guys could expand from our normal area. It worked nicely for us because everyone likes doing the work, but no one, including myself wanted to start making phone calls.
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Im not dead set on the commission route. I would much prefer to spend all day in a tree rather than doing sales, I just know that I can't be a field guy forever and that I won't be able to grow in our small company without getting into the business side. That being said I'm trying to get into the sales while still doing the fun stuff. ALB, does this guy you hired do the full sales process? I would like that option but I think it would require an overhaul of how we are currently structured. If it were my company I would probably try to do that, I can't see the boss going for it.
 
JTSpear said:
Im not dead set on the commission route. I would much prefer to spend all day in a tree rather than doing sales, I just know that I can't be a field guy forever and that I won't be able to grow in our small company without getting into the business side. That being said I'm trying to get into the sales while still doing the fun stuff. ALB, does this guy you hired do the full sales process? I would like that option but I think it would require an overhaul of how we are currently structured. If it were my company I would probably try to do that, I can't see the boss going for it.
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@JTSpear I hear you there. I don't think you would need any changes though; I didn't. I'm probably not explaining what he did very well. I run my business as normal. My SEO guy just got way more people to call my company.

He redid my site and got it ranked higher, which brought in more calls. He also created another site for me to generate me even more calls, which he set up to auto-forward to my phone (awesome). When any calls comes in, the ball's in our court. My guys and I go out, provide an estimate, and close sales like normal. More leads is more chances for us to close jobs, which translated to more money. I'm in the process of expanding because we're approaching too many calls coming in haha. Never thought I'd say that. I can PM you his email if you'd like to talk to him. He's busy, but he's pretty responsive.
 
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ward said:
I seriously doubt that it is normal for arborist salespeople to be making $200k a year. You'd need to have a very large company with limitless customers somehow willing to pay that extra %10 premium on each bid. I just doubt its possible. I'm guessing that owner/salesman is the usual arrangement and that the cost of the extra sales is essentially eliminated. The difference between $1200 for a removal and $1000 for a removal in my market is the difference between success and failure. All the gladhanding and social schmoozing aside, for most people its an economic calculation (within reason). Unless that salesman is a real "it that stinks" (ee cummings), I doubt the success rate for exorbitantly priced work is going to be very high. Go ahead and drive yourself crazy with a 20% success rate.

I suspect its also why your boss is offering you only 5%: he knows any more than that and his profit margin for the work goes down to low and your success rate goes down too.
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Ward - There are LOTS of guys making this much $. Some even more....just sayin. Also, though most guys making this much are usually running 1-2 tree crews and 1-2 PHC guys full time as well. It's hard to make that kind of money JUST selling treework.
 
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