The most successful sales teams working on the trading desks on Wall Street had a saying: “You eat what you kill.”
Firms like Bear Stearns and Montgomery Securities (where I had my first job in San Francisco in 1999) always hired college and professional athletes because they were the most competitive and wanted to win at any cost.
Here are 11 rules to keep when looking to hire your first salesperson:
Always foster healthy competition by hiring 2 sales people, not just one. They will feed off each other’s energy.
Always pay a salesperson on commission! There’s nothing worse than getting paid a salary and a bonus that is based on metrics that are unclear. If a bonus is paid it should be closely and transparently tied to your sales numbers. If this is the case, then why not pay on commission?
They should get a kick out of winning a sale – an adrenaline rush. We’re talking fist pumps and high fives because each sale means MONEY!!
Determine and be very clear about the key metrics the sales person will be paid on. Number of phone calls made, as a metric is useless – 1 million phone calls with zero sales adds nothing to the bottom line.Worthwhile metrics are: # of sales closed, total $ amount of sales closed, # of each product sold, $ amount of each product sold, # and $ discount given to close a sale, timing of sales (is it the last week of the quarter or steady throughout the quarter), the conversion rate, profitability of the top 5 clients of the salesperson, etc.These can be tied to how you see your key financial metrics. That is, you want the salesperson to focus on your most profitable products and most profitable industry/customer segment.
Also, monitor Customer Acquisition Cost (CAC) and Lifetime Customer Value (LCV). The salesperson should be aware of these 2 metrics and track them closely – minimize the first and maximize the second.
The salesperson must have a successful track record selling a similar product or service that you provide. (Be cautious about hiring a product salesperson to sell a service).
They should have a strong ‘rolodex’/book of business already.
The most successful salespeople use the 80/20-rule to drive quality leads and have a strong referral strategy in place.
Always do reference checks and if possible find a 2nd or 3rd person to talk to at a company the candidate worked at who was not provided as a reference. You’re looking for rave reviews – 9’s and 10’s. Anything 8 out of 10 or lower, ask why not a 9 or a 10 and start probing.
Ultimately, since he/she is a salesperson you should feel as though they have sold themselves exceptionally well to you and for the position you’re hiring. Don’t be scared to call his/her bluff: “I’m not hearing superstar sales person. Are you sure this job is for you? I’m not getting it.”
Always have a probation period to start with and very clear performance targets that you will be measuring against. You have to be very clear about what you want.
Most importantly: does he/she gel with you personally. They must genuinely believe in the product or service they are selling and are excited about it. They care more about the person they are selling to than making the sale. And they truly believe what they are selling will make a difference in the customers’ lives.
There’s no magic formula to hiring a salesperson, but if you can check off most of these points you’ll have a good probability of finding a superstar salesperson.
Today, we’ve barely scratched the surface
Whatever stage you’re at in business, you need to be all over the numbers. In posts like this, we aim to offer bite-size food for thought – but in a few hundred words, we can only do so much.
If you’re ready to build your financial muscle, how about a FREE copy of James Vanreusel’s (highly-acclaimed) book for CEOs?
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