Let's Talk Turkey - 101106

It’s early November and most everyone is getting ready for Thanksgiving in a few weeks – everyone except most business owners.  Most of us business owners are burning the midnight oil trying to figure out how to squeeze a profit out of this economy and in some cases, just trying to break even while we ride this storm out.

So, let’s get to the bottom line.  There is still business out there.  People are still spending money, just more selectively than before.  So what do you do?  The answer is simple, you run lean, you run efficient, and you go get the work.  The days of the “order-taker” sales team member being able to get by on the crumbs off the table and stumbling across a nice order every once in a while is no longer effective.  With that in mind, the true hunters are still producing, albeit, maybe not as they were before, but they are still leading the pack.

So the question appears to be, what to do with the “order-takers”.  I know there are as many answers as there are people; however, I offer two options for your consideration providing you have a reasonably motivated and capable employee:

1.       Downsize the “order-takers” and reassign the customers to the producers.  While this seems like a quick fix; this could be a $66,250.00 expense.   Using $75,000.00 as a total salary/commission basis for our “order-taker”, think about these costs:

a.       Cost to hire a replacement when the economy picks back up:  $18,750.00

                                                               i.      This is an average commission for a headhunter and is a relatively reasonable budget to account for the headhunter or the lost time, productivity, and effort of your HR department.

b.      Cost to train the replacement to your company standards:   $18,750.00

                                                               i.      It’ll take at least 90 days to get the new employee up and running.

c.       Cost of lost customers that “just loved the former sales rep”:  $18,750.00 conservatively.

d.      Severance/unemployment/etc:  $10,000.00 conservatively

e.      Total Cost to “down-size” the “order-taker”:  $66,250.00

2.       Invest in an outsourced consultant to assess an alternative training program to assist the “order-taker” to transition from “order-taker’ to “quasi – hunter”.  While you may never make a true hunter out of them, everyone can be coached to a higher level of performance.  The added benefit, once they learn to become a “quasi-hunter”, the benefits will be compounded annually.  Total cost:  $0.00.  (The consultancy fee would be calculated into the break-even analysis).

Remember, of the many reasons to hire a consultant; objective review of business practices and specialty training are among the top ten.

Until next time…