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  #1  
Old 12-15-2008, 12:46 PM
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tb8100 tb8100 is offline
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Default Incentive-based compensation: team pay vs. individual pay.

As we expand our sales force, we're looking at using a team-based compensation plan to encourage a team effort to sell, rather than an every man for himself approach where salesman fight over customers and what not.

With a team-based compensation plan, everybody has a base pay (we're looking at salary) and then when the team collectively hits goal, everybody gets the same bonus check. Now, you have to have individual performance monitored to prevent freeloaders, but with team compensation, salesmen don't care if they're the one that closes the sale or another salesman. They both equally care because they're a team and they're looking out for one another. Salesmen will send each other sales. It's really a neat concept.

In a shop where you have handheld techs, rider techs, and walk-behind techs, individual compensation makes more sense. But in an environment where you have multiple employees performing the same tasks (selling the same equipment, working on the same equipment, etc.), a team-based compensation makes a whole lot of sense.
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  #2  
Old 12-15-2008, 01:58 PM
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MowerGIRL MowerGIRL is offline
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If I were selling, I wouldn't want my pay to be based on a team.
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  #3  
Old 12-15-2008, 02:48 PM
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Quote:
Originally Posted by MowerGIRL View Post
If I were selling, I wouldn't want my pay to be based on a team.
Not if you didn't trust the other members of the team, or you didn't trust the employer to monitor their performance. If you stressed a team-like atmosphere and showed your employees you or the sales manager were looking out for them and making sure everyone is performing, I think it would be rather attractive.

Think about it- the salesperson wouldn't view the other salesmen as competition. They would be sending eachother sales. I personally would rather work in a team environment than an every man for himself environment.

I guess it's a personal preference thing.
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Price; Quality; Service; Choose any two.

If You Always Do What You've Always Done, You'll Always Get What You Always Got.

Kioti Tractors and Side by Sides | Branson Tractors | TYM Tractors | Bad Boy Mowers | Hustler Turf Equipment | Gravely Mowers & Chore Products | Ariens Mowers & Chore Products | Echo Power Equipment

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  #4  
Old 12-16-2008, 10:20 AM
Commercial Dealer Mike Commercial Dealer Mike is offline
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Are you building this off of another model? From this industry or another -- for example, auto/truck sales, real estate, retail, etc?

I'm curious to know how this method has worked in other environments and/or business segments.

I've alwasy been under the impression that commission drives sales. However, a team-based approach is an intriguing concept.

Thanks.
Z
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  #5  
Old 12-16-2008, 10:59 AM
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tb8100 tb8100 is offline
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Quote:
Originally Posted by Commercial Dealer Mike View Post
Are you building this off of another model? From this industry or another -- for example, auto/truck sales, real estate, retail, etc?

I'm curious to know how this method has worked in other environments and/or business segments.

I've alwasy been under the impression that commission drives sales. However, a team-based approach is an intriguing concept.

Thanks.
Z
This is actually off of the Dell Direct Store mall kiosk model, so computers. My brother was a regional manager for the DDS in the southeast for awhile and spent years working his way up the chain with them. He and I were talking about their team-based approach and I thought it was a great idea. Since he majored in Marketing and Professional Sales, he studied a lot of different sales models and there are a lot of good ones out there. You just have to pick what's going to work best for your business and industry.
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Price; Quality; Service; Choose any two.

If You Always Do What You've Always Done, You'll Always Get What You Always Got.

Kioti Tractors and Side by Sides | Branson Tractors | TYM Tractors | Bad Boy Mowers | Hustler Turf Equipment | Gravely Mowers & Chore Products | Ariens Mowers & Chore Products | Echo Power Equipment

http://www.bigredsonline.net
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  #6  
Old 12-16-2008, 11:07 AM
Commercial Dealer Mike Commercial Dealer Mike is offline
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Under this model, would you still offer performance-based bonuses?
Or is it a group bonus --sort of like profit sharing?

Also, what does the sales manager use to benchmark the individual perfomance of his/her sales team?

Thanks.
Z
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  #7  
Old 12-16-2008, 12:19 PM
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Quote:
Originally Posted by Commercial Dealer Mike View Post
Under this model, would you still offer performance-based bonuses?
Or is it a group bonus --sort of like profit sharing?

Also, what does the sales manager use to benchmark the individual perfomance of his/her sales team?

Thanks.
Z
It would be a group bonus. The idea is that they would work with eachother to meet fair goals set by the sales manager. The sales manager's job would be to set fair goals for the team, and also to track individual salesmens' performance, which can easily be done with any POS software. Make up a bar graph of each salesman's sales, etc.

Now if a rep did far and away more than the other team members, it would certainly be appropriate to have a plan in place to reward that.
__________________
Price; Quality; Service; Choose any two.

If You Always Do What You've Always Done, You'll Always Get What You Always Got.

Kioti Tractors and Side by Sides | Branson Tractors | TYM Tractors | Bad Boy Mowers | Hustler Turf Equipment | Gravely Mowers & Chore Products | Ariens Mowers & Chore Products | Echo Power Equipment

http://www.bigredsonline.net
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