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Setting up a sales team

Setting up a sales teamMany small businesses start out without any sales expertise or dedicated sales staff but Michael Warne, regional director of the Chartered Institute of Marketing and former chief executive of the Institute of Professional Sales, believes it's essential to realise that even the best product or service won't sell itself

According to Michael Warne, many small businesses believe a good product or service will sell regardless of their sales efforts, but this isn't the case.

"Most businesses are started by a person who knows a lot about a certain technology or about a particular sector. In the latter case they may have a sales and marketing background and be well-placed to do the selling themselves," says Warne.

"However, if they don't know anything about sales my advice would be to hire a sales professional who also has experience or knowledge of the sector or product."

While this might sound logical, how does a business-owner without a sales background attract, interview and keep hold of a good sales person?

Identifying the right salespeople

To begin with, Warne advises business-owners to:

  • Decide what type of salespeople you need. Field selling requires skills different from those used in cold calling.
  • Look for people with some knowledge of the industry, product or service. This is not to say you can't train someone, but it's hard to go from selling something like pharmaceuticals to food, for example.
  • Consider using a recruitment agency. It may cost more but they will be able to help you find the right person.
  • Don't overlook existing staff with sales potential. They will have a good idea of your products or services and are likely to have already built relationships with some of your customers. However, new employees may also bring in new contacts.  

If you're worried about employing someone with the wrong skills, it can be a good idea to put them on a probation period first to see how they get on.

Pay and rewards for salespeople

Once you do employ someone you will also need to work out how you are going to pay them. Most salespeople will be used to working on a part-pay and part-commission basis.

"It is better not to use commission only because this will only be suitable for some products and services," says Warne. "It is also, in my opinion, much better to employ someone so they feel they're part of the company instead of using people on a casual, commission-only basis."

Research shows the best mix is 80% basic pay and 20% commission. The basic pay will usually be quite low - about the same as a good secretarial wage. But the benefits on top, which can include things such as a company car, make the package more attractive.

Warne believes business-owners shouldn't feel they have to justify to non-sales staff the amount of commission sales employees get.

"Going out doing field sales is hard, demanding and sometimes depressing. They have to cope with rejection and going out in foul weather."

He adds: "However, if they're clever, small firms will create team-bonus schemes so that support staff in the office also get to share in any sales success."

Ongoing training

Above all, Warne believes it's essential not to employ a salesperson and then forget about them. Ongoing training, targets and frequent meetings are needed to get the best results.

"Even old-timers should spend 10-20% of their time being trained - either about new products and services or on refresher courses," Warne adds.

Written with expert input from Michael Warne of the Chartered Institute of Marketing.