Salesforce
Motivating and Retaining Salespeople It is the deals salespeople bring in every day that keep home improvement companies solvent. Yet, salesforce turnover is notoriously high, sometimes exceeding 100% in a year’s time. In-home selling is tough, tougher by far than business-to-business selling, according to George Dunning, vice president of Homefix Corp. in South Orange, N.J. “It takes a lot more natural sales ability to do what we do,” says Dunning, who manages a salesforce averaging 50 people out of six offices. “Anybody with a personality can make that [business-to-business] sale.” Dunning says turnover at Homefix has declined since the company started a sales training program he describes as “intense, aggressive, upbeat, and 21st century.”
Salespeople at many home improvement companies, including Homefix, are not employees but independent contractors, working on commissions that average about 10%. Greg Williams, sales manager at Cal-Tec Enterprises, a window installation company in Fresno, Calif., says straight commission motivates better than any other system. “It’s Christmas morning every Friday when they open those commission checks.”
Many Replacement 100 companies — 84% — offer bonuses to salespeople who hit certain sales targets. If reps are independent contractors, that bonus money will help them cover their health insurance and car expenses. Drew Nietzer, president of LGH Corp., a gutter protection company based in Alpharetta, Ga., says that depending on the season, typically two-thirds of company salespeople meet LGH’s monthly sales bonus targets. Many companies, including LGH, retain salespeople by offering a strong benefits package, including health insurance and 401(k). To keep the ranks of salespeople full, many companies now offer a strong benefits package. Forty percent say they pay for at least some portion of the salesperson’s cell phone expenses. Salespeople, as all will attest, live and die by the cell phone.
Do you have a sales bonus program? Average number of salespeople: 28
Average number of jobs sold by a salesperson in a year: 93
Average size of job sold: $7,249.16
Average annual revenue per salesperson: $682,232.76
What benefits do you offer your salespeople?
Group health insurance 71%
401(k) or similar 57%
Cell phone 41%
Vehicle/car allowance 34%
Other* 16%
*Includes life insurance, long-term disability, company trips, ESOP, training, dental insurance, travel, profit sharing.
About the Survey
The Replacement 100 is a ranking of leading U.S. companies engaged in the replacement of roofing, siding, window, decking, and ancillary lines that participated in the 2004 annual survey of home improvement companies. Data collection for the 2004 survey commenced in May 2005 with an initial survey of 350 companies identified by the REPLACEMENT CONTRACTOR editorial staff, with input from industry consultants. To participate in next year’s survey or for additional inquiries about this year’s list, contact Jim Cory at 215.923.9810 or jcory@hanleywood.com.
