Sales Commissions In Florida

Robmartin

Good day,

I would like to know what is the standard sales commission for a sales person in the canstruction and remodeling industry in Florida.

What is the percentage per sale?

Thank you,
Rob

naptown CR

Depends on what type of cans you are trying to sell.

willworkforbeer

And depends on how many cans per sale, volume discount.

modterry

You have to look at what it costs overall to book a job.
What is your average Sale ?
What does a lead cost you ?
How many hours does it take to book the sale ?
What do you expect the Sales person to do ? ( Do they do the Sale, the estimate, any oversight , etc. )
Where do the the leads come from ?
Are they on commission only ?
How much volume will your sales person need to sell to make a "better" than decent living. You want to give them incentive.
Sales - should be the highest paid person in your organization.


Our commission structure is :
New construction - is lower as a % than Remodeling
with new construction - the work is on the front end - our sales does not need that much interaction after the sale.

Remodeling - almost has to be there every other day or so - to keep the customer happy.

Terry

Robmartin

Thank you Terry

modterry

If you sit down and go through your Business processes in detail it will help you understand how much to pay someone.

Example:
1) Biz Plan - decide what is your ideal client, job and the level of service you will have to give.

Estimate realistic sales projections

Why are you in business ? ( your personal needs, goals )

What does your company offer

Describe various job descriptions


2) Marketing - what will you need to spend to acquire a customer
Leads in, no of leads to bids / no of leads closed etc.

3) Sales Processes

4) Admin Processes

5) Construction Processes


Read Remodeling in April - It had a survey of remodeling companies in various sales levels. Real education.

I spoke with the author and he confided that most remodeling companies until they were over $ 1,200,000 in sales did not account for sales and marketing costs.

If you plan to work 2000 hours a year.

You want $ 300,000 in sales / 2,000 = the cost / hour is $ 150

If you , like most, can only spend 20% of your time in sales then :

$ 300,000 / 400 hrs = $ 750 / hr

You need to decide the kind of Market (jobs) to go after
2 jobs @ $ 150,000 jobs or 300 jobs @ $ 1,000 or somewhere in between.

Most owners of remodeling companies wear several job hats ( Sales, Estimating, Ordering , Job Supervision and spend alot more than 2,000 hours per year )

You need to assess what your strengths are and weaknesses and decide where you want to hire.

If you want Your business to become mature where you could leave it for a month ( how about a vacation ? ) and it operates without you. You want to develop people and systems.

We Use this Budgeting Formula:

Sales = 100 %

- Sales Costs = 8% ( Sales Commissions / Marketing Expenses )

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= Net Sales Amt 92 %

- COGS = 72% ( Cost of Goods = Materials / Labor / Subs )

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= Gross Profit = 20 %

- Admin Costs = 10 -12 % ( Auto, Taxes, Bookeeping, Insurance , Salaries , etc )

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= Net Profit Before Taxes & Interest = 10%

- Interest / financing ( Any Long term debt )

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= Cash Flow Before Taxes

( Cash Flow - used for new equipment, expansion, etc )

Hope this helped answer the original question.

Terry