Creating a business plan/ comp plan I have recently applied for an outside sales position at a company which has never hired from outside for a sales position, they have always grown them organically from within the organization. They pay their current sales reps a salary and then a bonus which is a % of the total profit for the company based on individual statistics, basically its a team oriented sales position. I am coming from previous Independent contractor positions which were either salary plus commission, or straight commission. Because of this, and the fact that they don' t pay "commissions," the manager asked me to write up a business plan of how I would get the job done, a compensation package that would work for me, as well as create a way that I would like to be measured on my performance. Hm.....it appears to me they might not be prepared very well for the market, or at least not with you. They are probably looking for some ideas to develop themselves better and this is why they are making you build a business plan. After all, you' ll be building up a strategy which can be applied by them to other previous employees.
This isn't going to be a business plan for the company, just for my own future plans of how I plan to accomplish things. I forgot to mention that I declined the position previously and told them the reason for declining it was because of the salary, so this is a way for me to prove to them that I am worth paying a higher salary to if that makes sense. If I were you, I' d propose a compensation plan that starts with a higher base salary which declines over time as your sales increase. You' re the only one who can decide that starting salary should be in order for you to make ends meet and pay your bills, but having established that, propose a declining salary by some percentage every month over the next however many months. By doing that, you' re indicating your level of confidence in your ability to generate sales and your willingness to "bet" on that ability by asking for less base six months from now which will save the company money on salary while, at the same time, increase company revenue. I' d propose a percentage commission based on those revenues that essentially keeps you even until you' ve reach the final base. Then increases in compensation for you after that will be the result of your selling skill based on a fixed commission percentage so the more you sell the more you earn. Hope this helps. The problem that I see is that you are coming from an individual commission-based job to one that is team oriented. It is doubtful that they are going to make wholesale changes from a structure that has served them well in the past. If you need to suggest something, I would suggest a hybrid plan. Take the total compensation expected and divide into thirds. +/- one third will be base salary, +/- one third would be team-oriented commission/bonus (to preserve the past culture) and +/- one third would be individual commissions. As for the business plan, show them how you plan on attacking your markets and what you see as your sales targets/goals in 3, 6 and 12 months. | |
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