How Many Salespeople Should I Hire?

One of the most asked questions I get is how many sales people does it take to get the revenue numbers needed. Personally, I believe in large sales forces because in highly competitive situations the largest army wins. That doesn't mean, however, that you can go out and hire 100 sales people if all you can possibly sell this year is a million dollars if everything goes right. So how do you decide how large a staff you need?

The first thing to do is to determine how much revenue you want. I say want because your present staff is getting you what you have and will be only able to grow so much. But if you want to double or triple your sales you will have to increase the number of people selling. It's just a fact of life. So let's say you are billing $2.5 million and want that to grow to $4 million. Your typical sales compensation is 10% commission so your potential commission pool will be $400,000. Next determine what the average sales person in your business should make. One rule of thumb I've used for new sellers is compensation for a 2 year professional just starting out. Let's say $55,000 per year. Well dividing your commission pool ($400,000) by your compensation target ($55,000) would tell you that you need 7 sellers on staff to get to $4 million. What's that you say? You only have 4 sellers and they are making a little more than $55,000? That's right and that's why you are doing $2.5 million. And you will do $2.5 million give or take a few hundred thousand until you hire those extra 3 salespeople.

Of course, the numbers given here are for example only and may differ in your situation. We can calculate the number of sellers in almost every business, however, so call me if you want to discuss your particulars.

Now how much do you want to sell? We can calculate that too but I'll save that for another column.

Mike Shannon is the owner of Shamrock Business Coaching, a coaching practice that helps business owners increase profits. You can visit Shamrock Business Coaching on the web at: http://www.ShamrockCoaching.com.

---

Accepting Responsibility for Your Sales Success

That we live in a time of relentless and pervasive... Read More

The Spirit Of Change

A Highly Conscious Approach To Business Management. For more on... Read More

Do You Know How to Fire Up Your Sales Staff (When Money Isnt Everything)?

Money is the only thing that motivates a salesperson, right?... Read More

The Top 5 Issues Facing VPs of Sales

A recent study of 2,663 sales organizations by Think Training,... Read More

The Boss from Hell: Quick to Criticize, Slow to Praise

So you have a boss who dumps all over you... Read More

Management From Within

Inspiration and Management from Within ? Part 2.The more you... Read More

Make Time, Not Excuses

There are four primary activities that successful salespeople engage in... Read More

What Is A Proposal? And Why Do You Need One?

Do you know anyone who regularly wins bids? Or can... Read More

How You Can Raise Your Business Earnings By 50% With An Age-Old Magic Truth

Imagine increasing your business earnings by 30, 40, or 50%.... Read More

Book of Lists Marketing for Pressure Washing Companies

The American Business Journals produces a Book of Lists each... Read More

The Art and Science of Managing Expectations in Selling

It is very easy to fall into a trap with... Read More

14 Top Lead Generation Tactics

According to former Harvard Business School professor David Maister, typical... Read More

How To Have A Successful Retail Sales Event

In the 30-plus years I spent working in advertising and... Read More

A Coachs Handbook For Sales Managers

This article may be reprinted in its entirety with express... Read More

The Nine Warning Signs that You Need a Sales Video

Corporate videos are an important sales tool that can often... Read More

Overcoming Sales Objections for Small Business Networks

Do you need help overcoming sales objections? Do you sell... Read More

Set Yourself up for Trade Show Success

Of the many mistakes small business owners make, a big... Read More

Promoting Your Private Label at Industry Trade Shows

So everyone thought you were crazy when you announced 6... Read More

Is Your Sales Trust Factor High Enough to Win Against the Competition?

How high is your sales trust factor?Is it higher than... Read More

Sales Tactics to Beat Your Competition

This month I want to share a success from a... Read More

8 Line Items of a Trade Show Budget

Budget Guidelines for Trade Show MarketingB'techa didn't know - Trade... Read More

Five Steps to Maximize Success in Targeting For Growth

Targeting is the process of selecting high potential customer accounts... Read More

How to Sell Strategically

If you want to maximize your sales performance, take a... Read More

How We Build a 90% Failure Rate into the Sales Process

I recently began doing training in the banking industry. Across... Read More

All Small Businesses Need to Gather Community Intel

How well do you know your community? As business owners... Read More

Back-to-School List - 10 Tips for Trade Shows

There's a new year beginning now - the school year.... Read More

Disclosure Laws Favor International Terrorists

The Federal Trade Commission has rule that are supposedly in... Read More

How Do I Manage Workplace Conflict?

Workplace ConflictConflict is an inevitable part of business life and... Read More

The Sales Carpenter

I remember moving my family to Argentina as Vice President... Read More

Outsourcing the Sales Function

Small to medium companies that want to increase sales or... Read More

How to Improve Your Management Procedures Usability

Are your people consistently following your procedures? Each year, organizations... Read More

How Your 60-Second Elevator Script Can Transform Your Staff, Your Sales, & Your Business

When attending a Chamber of Commerce breakfast networking get-together, I'm... Read More

Sales Plan? Whats a Sales Plan?

In the past, if you said the word "plan" to... Read More