Reducing Sales Rep Turnover

Fred BergerPresidentDocument Technology Solutions Consultingwww.documenttechnologysolutions.com

“Partnering with Dealers to Reach the Next Level”

Agenda

• DTS Consulting Introduction• Key Industry Trends• Cost of Sales Rep Turnover• Reasons for Sales Rep Leaving• Common Turnover Reduction Actions• Circle of Success• Summary • Next Steps• Questions

DTS Consulting

• An Independent Industry Consulting Firm Dedicated to “Partnering with Dealers to Reach the Next Level” • 35 years experience helping companies grow and improve overall

performance through change and innovation• Access to Alliance Partners representing some of the best expertise

in the industry• President of the 4th largest Sharp Dealership in the US• COO of a $20 million Dealership• Vice President Danka Acquisitions• Vice President of Ricoh Business Systems - Ricoh’s Direct Channel

Key Industry Trends

Copier Industry• Speeds and

Feeds

Digital Revolution• Paradigm Shift

Explosion in Color

Technology-Driven Solutions• Managed Print

Services• Electronic Document

Management• Scanning (capture)• Processing (manage)• Integration (making

software work)• Routing

(storage/retrieval• Mobile Devices/Cloud

Printing

Cost of Sales Rep Turnover

The average turnover for copier sales reps in the US is 60 %30% of all sales reps have been with their current company less than 1 yearThe average tenure for a new hire is between 3 and 6 months

The average cost of a sales reps turnover after 5 months is:

• Salary @ $24,000 year $10,000• Fringe Benefits @ 25% $ 2,500• Car Allowance @ $400 mo. $ 2,000• Recruiting $ 3,000• Training $ 2,000• Total $19,500 This excludes any lost Gross Profit that a sales rep would produce from sales and aftermarket

Reasons given for Sales Rep leaving

Did not understand

job

Too much cold calling

Did not make enough money

The company

My manager did not

support mePoor hire No training Not enough

customers

Lack of support

Sales Rep was a loser

Did not like sales

Time spent to hire a Sales Rep

Recruiting time 1 hourPreparation for interview ¾ hourInterview by 3 managers 1 ½ hoursPost interview review ¾ hourTotal 4 hours Number of interviews per hire 6 interviewsNumber of hours spent interviewing per hire 24 hours

If you have 20 reps at 60% turnover that consumes 288 hours or 36 days per year

Typical things companies do to reduce turnover

More Training of sales reps :• Products• Sales Skills

More training of sales managers

Use telemarketers for appointments

Testing of applicants

Have applicant’s rides along with a rep before hiring

Assign a mentor to the new hire

Change compensation plan Accept turnover

Do not hire any more inexperienced

reps

Do not add any more sales reps etc

Results of all these actions

Turnover remains high

Revenue is reduced

Profit is reduced

Activity Management/

Account Reviews

Hiring

Compensation

1st Day/10 Day Orientation

Sales Rep Opportunity

Training

Success Factors/

ProgramsSM

GSMVPS

In the center of all of this are the people responsible for effectively executing each element

Circle of Success

Sales Rep Opportunity

• Why are you hiring a sales rep?– Replacement?– Addition?

• Have you evaluated the territory/opportunity?– Territory make-up

• What type of Sales Rep are you hiring? Why?– Geo– Vertical– Major Account– MPS– Software/Solutions– Specialist– Team concept

• Can the territory support the Sales Rep?– MIF?– Customers?

Hiring

• Based on the type of Sales Rep– Have you developed a general profile?– Have you developed a specific profile?

• Skill set of candidate must align with the opportunity– Geo rep– Vertical market rep– Major account rep– Solutions rep– Specialist

• Interview process– Behaviors– Skill sets– Experience level– Testing– Pre-set questions– Interviewers, manager, general manager, vice president, owner, etc

• Develop/ Maintain candidate pool• Do Not Settle

Compensation

• One size does not fit all• Compensation plan must align with company strategy,

sales rep opportunity, sales rep profile, etc• Base compensation versus variable compensation• Align with company strategy, sales rep opportunity,

sales rep profile • Ranges, competitive, drivers, internal alignment,

experience• Sales Manager compensation should be geared toward

sales rep success

1st Day/10 Day Orientation1st Day – The most important day!!!!!!

• Welcoming• Tools ready

– Phone– Laptop– Computer access– Desk, chair, clean– Business cards– Company documentation– Organization chart– Hiring paperwork

• Introduction– Company management– Key personnel

• Meeting– Game plan

1st Day/10 Day Orientation

10 Day Orientation• Create a 10 day orientation• Should be day by day, hour by hour• Include :

– meetings with key individuals– Training on tool utilization– Training on company sales/marketing materials– Training on products/programs– Training with key sales reps– Training with manufactures sales reps if possible– Review meetings after each session with manager/employee– Home work assignments– Etc

• Keep them involved at all times• Have 1st management review with employee after this 10 day program

Training

Management’s commitment to training is critical to success and retention of sales reps

• Continuous training throughout their career is a MUST• Ensure the training process is managed• Create a multi level training plan, include time frames and reviews• Should include:

– Manufacturer's training– Web based training– Hands on training– Self paced training– Etc.

• Manager reviews after each course, evaluation• Manager MUST reinforce training programs• Manager MUST make sure training program is adhered to.• Showroom must include hardware and software to support training program• Sales manager should have weekly team training meetings

Activity Management

• Sales Managers need to drive sufficient activity levels to achieve success

• Activity levels need to be sales rep type driven• Sales Managers need to review and monitor

activity and levels• Sales Force Automation tool should be used to

monitor activity and pipeline

Account Reviews

• Account reviews should be on a set schedule• Sales Manager should conduct thorough account

reviews• Account reviews should be solution driven not just

sales close driven• Team account reviews should be the norm• Next level manager should sit in on many account

reviews• Remote monitoring and SFA tools should be used for

account reviews

Success Factors/Programs

• All Sales Reps should be aware of internal/external marketing/sales programs

• Sales managers should make sure these programs are used appropriately

• Internal programs should be geared toward strategic plans

• Internal programs should be geared to make new hired sales reps “Ring the Bell”

• Sales manager should be tied to the success of these programs

Summary

Technology is Driving Industry

Change at a Rapid Pace

Sales Rep Turnover is extremely costly

There is no one thing that causes

turnover

Back to Basics is required

“Circle of Success” is a building block

Time spent up front well worth

while

Next StepKey Area Assessment Grades

Sales Rep Opportunity 1-10Hiring 1-10Compensation 1-101st Day / 10 Day Orientation 1-10Training 1-10Activity Management/ Account Reviews 1-10Success Factors / Programs 1-10

Questions?

For More Information Contact:Fred BergerPresident

Document Technology Solutions Consulting, Inc.727-403-3936 ©

Fberger@documenttechnologysolutions.comDocument Technology Solutions Consulting

www.documenttechnologysolutions.com

“Partnering with Dealers to Reach the Next Level”