Sales Commission Question

firefighter188

Hi all, I'm new to this site. I'm applying for a sales job in the siding trade in St Paul, Minnesota. The job pays straight commissions at 8% the value of the job. Can anyone tell me if this seems like a fair wage for this type of position?

Thanks.

Teetorbilt

It's low here.

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PressurePros

If you sell a quarter million dollars worth you can make $20k. That would be what 35 jobs? I would want to know how many leads per week and how hot the leads are. If you are inexperienced with sales, cannot overcome objections and are a bit shy I would think you would close maybe one job per week. You're probably looking at about $600 per week profit if your getting five leads. The nice part is your income will rise pretty dramatically once you get good at it.

PS: Ask them how they get their leads. If it is from telemarketing it means they probably offer a "free, no obligation quote" which means you're close ratio will be MUCH lower.

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Ken Fenner
Pressure Washing PA
Roof Cleaning Services PA

firefighter188

They do their own advertising on the radio and in print as well as trade shows. They generate decent leads and the only salesperson last year generated around $2.5 million in total sales. The closing rate was about 30%. They are expanding to 3 sales people for 2007

I am new to sales, but have some experience based on tasks within my previous employer of doing marketing and selling of solutions to internal business units.

Finally the biggest difference is that I'm moving from IT to construction. I have a fair amount of understanding of the business, due to me just finishing a major remodel on my home where I acted as GC.

btw - the owner said that the marketing budget is about 10% total gross.

Any other advice would be much appreciated as well.

dougchips

2.5 million, they should cast him in bronze! Become his best friend.

concretemasonry

The area you are talking about has undergone a transition in new home construction. Because of the demand and historical growth without downturns, many big national builders have moved into the mass market. I doubt whether a individual siding installer would get much of a piece of this market due to the buying practices and commitments.

You should try to evaluate the rest of the mass townhouse/single family market and determine how many leads you could get. Keep in mind that any good salesman in the organization will maintain his leads and connections you would be gived what amounts to "cold calls". These would be the price shoppers and you may not end up getting a full commission.

Because of the amount of vinyl siding and the local dislike of it for good construction, the people selling cultured stone and a way to improve the image of a vinyl sided homes are coming out O.K., but they still have to cultivate contacts with the custom builders.

Fortunately there are a number of older homes that could benefit from the "magical transition" using vinyl siding that change thes character of the house. If new local home construction ever really goes down, this could be a short term good market if the company you are considering is active or is willing to get into it.

It is always a big challenge when you are changing fields - Good luck!!!

marc

I'm in NH and we do work in NH, Mass & Maine.

We pay a straight 10%

Grumpy

It's slightly low but that really depends on the avergae sale... A question you certianly want to ask.

Mr future employer... How many leads can I expect on average? Are there any slow times during the year? What kind of closing ratio are your other sales reps achieving? What are their average sales? How much are they earning per year?

BTW if youa sk all these questions you can do the math and see if the employer is bullcrappin ya.

For example if your average sale is $500, and you are paid 8% that leaves $40 per job for you. If you are only given one lead per day... You are going to be hurting. BUT if youra verage sale is $50,000 and you are given 10 leads per week and are selling 25%... That's $10,000 per week... Can you live on that?

You see there is more to it than just your commission. Also are there any bonuses or incentives or benefits? I know our orange big box friends pay a 7% base but have a tiered system paying a higher commission for the more you sell... Giving you incentive to sell more. Plus health insurance which can easily be a few hundred per month.

Are they providing a car, cell phone, Office space? Your commission is only a small fraction of the big picture.

I pay a base 11% for residential sales. Why 11%? because everyone else pays 10% I also offer bonuses for sales goals, and other various incentives.

Floorwizard

Grumpy really added a bunch of what I wanted to say.


good post.

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vinylguy

here in central pa. i pay a straight 15% on the total contract price. average contract price is 7-8 thousand ( i thought that # was higher but the math proves it not to be) we do strictley exterior remodeling altough i just added kitchen cab refacing. i only have 1 salesman and we sold 1/2 million in volume in 06 he made around 75000.00 this year not bad at all. he is content i do turn all leads over to him. i rehash any that don't sell and offer them some incentive and then pay him around 5% on those sales. i am looking to put another saleperson on this year and shoot for 1 million in sales. only time will tell what happens. we do the one call close here. its tough to do when your used to taking everything you can get your hands on but now that iv'e learned to walk away from jobs that don't fit my bussines i laugh at the guys that are doing some of them jobs for cheap and tell me all the horror stories they encounter with this type of customer. i remember the days. just living paycheck to paycheck working all the time just to keep head above water always oweing th suppliers. i found a new way of bussines and i am digging it. my best source for work is home shows fairs ect and direct mailers 3-part system around every job just a little plan i've come up with that really knocks the comp. out of the picture. hope this helps

MCPaint

what is a three part mailer? I am currently trying to design some doorhangers with a tear-off reply card postage paid offering free estimates. I was thinking of maybe making one part a tear-odd business card also. Is this what you are talking about? Where did you get yours?
Steve

dougchips

MC,

Mailer #1 "we will be working in your neighborhood"
Mailer #2 "we are working in your neighborhood"
Mailer #3 "we are almost done working in your neighborhood"

Just people mail to the same house 3-4 times in order to increase results.

ruskent

Is your 3 part mailer a postcard letter or ????

dougchips

Post cards. The bigger the better.

vinylguy

yes post card or insert with slice in for door knob hangers. with return postage. and i do the coming attraction to a home near you, then- now showing at a home near you,- then your neighborhood is improving, all with the customers project address on them. then always a job sign before during and after. the crews on the jobs are responsible for up keep on them and making sure that while they are working there it is in the most visible place. finally after the job is finished i send out my husband and wife team of canvassers. and the incidentals are our job trailer setting on the jobsite or in and out of the jobsite neighborhood while the job is going on and of course our lettered up trucks running back and forth. also and "KEY" we always asked for referrals from customers when jobs are complete. $50.00 gas cards are hot right now and alot of people really work to get them refferals for us. thats about it we use colony press for our mailers and door knob hangers 1000 peices for $40.00 not bad mailer are custom but you can get generics for $78.00 for 200 homeowners closest to job site both front and back with return postage. thats also where i get my door knockers with return postage 1000 for $40.00 not bad check it out and good luck.