Tag Archives: sales negotiations

6 Important Factors to Consider When Negotiating Your Next Sales Job

handshakeFinding that ‘perfect’ sales job is no easy task.  Most jobs have a straight forward description, offer a clearly defined salary and occasionally benefits.  Sales jobs on the other hand are complicated to negotiate. Even if you have an approximate dollar figure in mind that you need or want in terms of an overall dollar figure, it isn’t always so easy to calculate and get to that figure. This because in addition to base salary, there are multiple other areas of compensation and factors to consider including but not limited to:

  1. Sales Territory

LocationMapAside from monetary factors, the territory is probably the most important factor to consider and should be broken down as follows:

  • Geographic Location

You must be OK with the location of your territory.  For instance, I was fine with covering all of Canada but because my clients were not concentrated in major cities.  My job had involved a significant amount of travel by air and on country back roads and I loved that. If I had to just focus on accounts in Toronto, there is no way I’d be even remotely interested.  You have to decide where you are willing to travel to and how often and if that fits with the position you are considering.

  • Number of Accounts

This can be highly variable.  Some companies require that you manage only 30-50 accounts. I had 600 in my previous territory.  Depending on your time management skills, you may not be able to handle one or the other end of those extremes.

  • Previous Rep History***

This is SO important!! I cannot emphasize this enough.   Be sure to ask your future employer WHY the previous rep left this position and after how long.  Were they liked? Did they do a good job?  Believe it or not, the LAST thing you want to hear was how awesome that rep was and they were in the territory for over a decade! Why? Because you will have an uphill battle the entire time.  Good luck filling those shoes. Not only will your employer have much higher expectations of you, the clients will likely hate you at first because you’re not the old rep that they knew and loved forever.

On the other hand, if the previous rep did a lousy job then you have enormous potential to repair all of those relationships and grow your sales immensely.

If you have a chance, try to get in contact with the previous rep and ask them for their version of why they left.  They might give you some sort of insight into your potential future employer that may be a deal breaker!  Do your homework.

2. Commission Rate and Frequency Paid (i.e. monthly, quarterly, annually)

percent-signTypically commission rates are higher for junior sales positions and/or at start-ups and are usually offered in conjunction with a lower base salary.  The idea being that the rep is more focused on acquiring new accounts.  The more senior sales roles will offer a more hefty base salary and lower commission rate because those territories have been better established and require more nurturing of existing accounts compared to hunting down new accounts.  If you were used to receiving your commission on a monthly basis and the new company only pays it out at year end, you will have to re-do your monthly budget and determine if you will be able to live off of your base salary alone for an entire year. If not, then you can try to negotiate the frequency at which your commission is paid or try to negotiate a higher base salary with a compensatory decrease in commission.

3. Bonus

piggybankNot all companies offer bonuses for commissioned employees however some will offer a year-end bonus for teams who over achieve.  If this is an option, don’t include it in your budget because there is no guarantee that you will receive this.  Consider it icing on the cake.

4. Car Allowance or Company Vehicle

CompanyCarsEven if all of the numbers sound great in your offer, if you just bought a new vehicle and the new company only permits the use of a company vehicle you will have no choice but to sell your car or keep it and suck up the cost.  If you own your own vehicle and the company offers a car allowance, some companies have a policy which requires you to own a vehicle that is less than 2 years old. So even if you get a car allowance, you still may need to purchase a new car.  Car allowance rates are also highly variable.  I have never had one that fully covered my car payments and insurance.  This must also be factored into your monthly budget.

5. Expenses- What is Covered and How will it be Reimbursed?

credit cardsYet another highly available point.  It must be clearly defined what you will be able to expense.  Will it cover just meals? Or all travel costs including fuel?  Some companies insist their reps use a company credit card to cover all business expenses which is great because that means no expense reports! On the other hand, some companies will allow their reps to use their own personal credit cards and require the submission of monthly expense reports.  I always preferred the latter so that I could collect travel rewards and use them towards a personal vacation.  Once again, this is not usually negotiable.

6. Manager Style

badmanagerYou might say, “TSW How am I supposed to know this before I start?” The answer is quite simple and one you should remember every time you go through the job interview process:

The way your future boss treats you in the interview process is how they will treat you as an employee.

Never forget that.

So if you’re completely aggravated by the interview process, you will be just as aggravated if not more as an employee.   

If you are out there interviewing for that next sales position, don’t sell yourself short. It’s better to wait for that perfect position than to just jump into the first job offer that you get.

Happy Sales!

Cheers,

TSW

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