What do you pay?

Interloc

Anybody know going rates for salesman in % that generate work and your own in Canada?

gtp1003

There is a guy on another forum no disrespect to this forum ment. He is dr. roof on the NRG roofing forum. Hes a good guy and there is a few other fell's over there in Canada. Hope this helps. im in the states so im not sure.

Now here in the states, if you can make your own leads and close them around 40+ percent I was getting 50% of profit period.

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Interloc

Boy...doesnt anyone pay a salesman??

Grumpy

Interloc, the way I see it: It can be done one of three ways.

1) Commission (net sale) only.
2) Profit sharing (gross profit).
3) Salary plus commission or profit sharing.

Each one starts with identifying how much you feel this new salesman should earn. Let's say $100,000.00 per year. Then identify how much this person can sell per year. Let's say $1,000,000.00

From my point of view if I went back to being strictly a salesman I would want profit sharing on my jobs. 40% of the gross sounds fair, but I'd take less if various perks were included like company truck, cell phone, benefits, etc... When I was a full time salesman, before I started my company, I was paid a very small salary like $250 a week. Then 25% of the gross profit from each of my jobs. I also had a company truck and cell phone. I was doing very well, and now consider myself to be an idiot for leaving. I did more than sales though too, I did all the marketing management for the company and I managed my jobs from beginning to end. To be honest I really didn't want the salary, but my boss wouldn't up my commission.

I have hired very many salesmen through the last 6 years. Most of them were ultra hesitant to work on the profit sharing model. They always have the same lame argument "How can I control the crews? I don't want to be penalized for their mistakes." That's the difference between a salesman and a project manager IMO. A salesman just wants to sell and usually doesn't have the know how to manage the project. In this case I was paying the salesmen 11% base plus monthly bonuses for hitting certain targets. I was also giving gasoline reimbursements up to a certain ammount. Having said that I find that most companies around here pay a flat 10% of the sale ammount. You sell $10,000, you get $1,000.

If I ever hire another salesman, will lower the 11%, increase the bonuses and compeltely do away with the gasoline reimbursements. They can put their mileage on their taxes afterall.

Using the profit sharing model, and excluding any salary, you need to know your average daily gross profit target. Let's say your average job lasts one day only and will yield $2,000.00 gross profit. You will also need to know how many working days there are in an average year, let's say there are 200. If the salesman is to earn $100,000 here is the formula I would use... gross profit x working days = yearly gross then earnings divided yearly gross = gross profit sharing...

$2,000 x 200 = $400,000

$100,000 / $400,000 = .25 = 25% Therefore using this model the person would need to sell enough to cover $400k of gross profit at 25%. Sounds very reasonable if you ask me. If he sells more or sells at a higher gross you both earn more. If he sells less or sells at a lower gross you both earn less. Therefore it is in the salesman's benefit to really maximize profit on every job he sells.



Using the commission model, it's much much simpler. Yearly forecasted sales / yearly earnings = commission %. So...

1,000,000 / 100,000 = 10 = 10% commission.

The pot hole in this formula is that the jobs must be sold at a certain markup or you can lose on jobs and the salesman can still be paid. Trust me It has cost me many many thousands through the last few years. Kinda flawed if you ask me. This is why I prefer the gross profit sharing method.



If you decide you want to pay a salary in addition to the commissions or profit sharing, well that's simple. Just deduct the salary from the earning equation and run the formulas again, and you will have your commission or gross profit sharing percentages.


I hope that answers your question. I know you were probably looking for someone alot more simple.

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-Grumpy
Chicago Gutters Chicago Roofing

Interloc

No,this helps alot Grumpy,I like the just commision version,gives me something to go off of,..Thankyou.

English Roofer

Grumpy that was well put as usual!
Cheers
Dave

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Grumpy

Just make sure you remeasure and approve every job before you order materials and schedule the work, or have a clause in your agreement with the rep of what happens if he/she measure short.

__________________
-Grumpy
Chicago Gutters Chicago Roofing

croof

We have been looking for good sales people and can't seem to the find them. Where are they hiding? We offer a profit share and ask that the sales guys only sale. We have a full time project manager who gets the jobs done and full time office staff to support the sales efforts.

Any ideas? Where and how I can get a few good guys (or gals)

www.CaliberRoofSystems.com

buildpinnacle

Croof,

It depends on what you are looking for. There are a few 'good' salesmen around and even fewer 'great' salesmen. I wouldn't even consider a job in roofing sales unless I could make a min of $150K in a slow year and upwards of $250+ in a banner year. Trying to find someone who actually knows roofing, is a great closer, and if applicable knows the insurance gammet is a tough find. Having them self motiviated, self sufficient, is even harder. When you find one, take care of him/her. They can make you a ridiculous amount of money.

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gtp1003

All i can say is when i was working i was paid 50 percent of profit and 60 percent if i brought the job to the table. But that was me.

And it was profit nothing takin away. Just what was left after materials and labor.

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If you have a question just ask. God bless

http://solutions4roofing.com/

Email drag70buickgs@comcast.net