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DiscoDave
07-10-2010, 11:45 AM
What % commission would you pay a contract sales and marketing company that...

1. Agrees to a non-compete agreement.

2. Generates their own leads and closes the sale based on your pricing requirements.

3. Works out of their office.

4. Provides their own transportation AND expenses.

5. Will allow all sales to be verified and confirmed before you agree to payment.

What are your thoughts?

santafe
07-10-2010, 09:50 PM
I'd say 10%. most realestate is 5-7%. Auctioneers for on site is 10 -17%. I mention them because I'd say the work would be the same. But it is really just a guess.

domain311
07-11-2010, 08:18 AM
Maintenance I would guess maybe 5-7% and planting or general installations 10-12%.

trimmasters
07-15-2010, 10:41 PM
For spray accounts 20%, maby more. I'm interested, Who is this company?

DiscoDave
07-15-2010, 11:56 PM
Thank you to those who have answered so far.

Keep in mind, most green industry companies average 10% on advertising and marketing. Also, if they employ a sales person, they are paying a salary (that does not go away when the leads are not coming in), employer share of taxes and workers comp., perhaps benefits, vehicle expenses, plus a varying commission of 7% to 15%.

On the other hand, independent sales contractors work 100% on commission, generate their own leads (this reduces advertising costs significantly), covers own transportation expenses, there are no employment taxes, workers comp. or benefits to pay and they are self managed (fewer employee issues to deal with). You can terminate their services with a clear conscience and no unemployment claim when you reach your sales goal, slow down or feel as though they are not performing.

I was thinking...
10% to 12% for mowing.
10% to 15% for landscape maintenance.
20% to 25% for lawn care and tree and shrub programs.
10% to 15% for most other services (drainage systems, enhancements and other addons.

What do you think?

lawnangel1
07-16-2010, 01:25 PM
Where do I sign up?

trimmasters
07-16-2010, 06:13 PM
Can you start Monday? I would go for it. What part of Ohio are you in? it would be nice to pass the overhead of the sales team on to another company knowing you have a fixed cost for sales of 20% or so. how do you plan on having your team generate leads? Telemarketing, Door to door, Etc?

DiscoDave
07-21-2010, 12:10 AM
Can you start Monday? I would go for it. What part of Ohio are you in? it would be nice to pass the overhead of the sales team on to another company knowing you have a fixed cost for sales of 20% or so. how do you plan on having your team generate leads? Telemarketing, Door to door, Etc?

The company does not exist... yet. I am employed by another company at this time. However, I am a former lawn and landscape company owner and can't seem to kick the entrepreneurial spirit. I am considering starting a company that specializes in business development for the green industry.

Presently, I have sold over $600,000.00 in 2010 maintenance services for the company I work for and am not being compensated to my satisfaction. Also, I have to manage the division and would prefer to focus soley on sales and marketing (which is my niche and passion). I am confident, I would have approached or exceeded $1,000,000.00 in sales this year if I weren't't bogged down with managing production as well. I generated 70% (estimated) of my own leads. The other 30% were the result of advertising the company invested in as well as existing/previous customers requesting quotes for additional services.

I have an eye for developing original and creative marketing and advertising strategies that work. Plus... I am one hell of a salesman. :) Therefore, when I do this, I am willing to be 100% responsible for generating my own leads. The challenge I am having is gauging the level of interest/need for a service such as this. Also, trying to determine the market value has been daunting as well. The more I charge (%), the more I can invest in lead generation which (of course) results in more sales. However, the more I charge, the less attractive the service becomes.

I am curious to see your response.

lawnangel1
07-21-2010, 11:45 AM
I would hire you at the above percentage rates you already talked about, but like you said you would have to sign a non compete. But I think you could make a lot of money for yourself starting a development biz like this.

wbw
07-21-2010, 05:21 PM
I service swimming pools. I would gladly and I mean gladly pay 1 months gross for a maintenance account. If I could spread the payment out so that the customer actually payed for it as I went I would go as high as 3 months gross.

ChiTownAmateur
07-21-2010, 06:11 PM
My 2c is you deserve 10% of the gross from all accounts that you bring to the table for the life of the account.

Over 10% a business owner will question if he wants to give more than that away for a long period of time...at 10% it's fair. The business owner may sell additional services to that account over time that you didn't sell originally...so to me the simplest way to look at this is to say you are the "finder" and you deserve a 10% finders fee on everything they sell.

DiscoDave
07-21-2010, 08:51 PM
My 2c is you deserve 10% of the gross from all accounts that you bring to the table for the life of the account.

Over 10% a business owner will question if he wants to give more than that away for a long period of time...at 10% it's fair. The business owner may sell additional services to that account over time that you didn't sell originally...so to me the simplest way to look at this is to say you are the "finder" and you deserve a 10% finders fee on everything they sell.

Although, I think your thoughts to have an on going payment arrangement for the life of the contract is interesting. I do not think this is the direction I want to go. I would prefer to simply acquire the account, sell the account and move on.

As I have been doing research for my business plan, I am coming to the realization that my original thought of 10% commission on the low end is TOO low. It probably needs to start closer to 14% to 17% for this to work. Remember, this will be a full fledged business. I am going to invest real money in advertising, marketing and time spent acquiring these accounts (contracts). I will also have the typical business expenditures such as vehicle, phones, office equipment, insurance, marketing materials, printing etc. etc.

What I really need to do is finish my business plan so I have some concrete numbers to work with. I will let you know what I come up with.

In the mean time.... I am still very interested in hearing opinions and feedback regarding the concept.

ChiTownAmateur
07-22-2010, 11:12 AM
I think it will be very difficult to get service owners to give you upfront money for an account that hasn't proven to be a quality account that pays and isn't a huge PITA.

I could easily see giving an ongoing commission to a sales rep as a finders fee. I could also see a contractor situation where you retain control of the account and contract it out to services and if you can figure it out, maybe after a year or so "sell" them the account at say 33% or 50% of one year's revenue.

Az Gardener
07-22-2010, 11:42 AM
Couple of thoughts... If you sign up a stable of contractors how do you decide who to give the lead to?

On the maint. what is the % on that you will receive payment on? The monthly base, the yearly gross, some other multiplier?

BigBUCKEYEfan
07-22-2010, 05:34 PM
I would seriously consider a 15%-20% commission on sales generated from an independent sales person, possibly slightly higher. Obviously there would have to be some stipulations as to how a commission is to be payed, as an upfront commission i don't think it would be likely, but a gradual commission with some incentive to retain accounts or selling on a 3 year contract might be even more possible and on the higher 20% range. Obviously a non-compete and other contractual obligations would have to be worked out, but could be very doable. I guess my question would be most businesses may already have their own marketing plan, advertising literature, vehicle, etc so that may have to factor into what someone would be given in a commission. But all those things would be very negotiable for someone with great sales motivation.

DiscoDave
07-22-2010, 08:46 PM
I think it will be very difficult to get service owners to give you upfront money for an account that hasn't proven to be a quality account that pays and isn't a huge PITA.
I can understand how some may have this concern. This is something I will need to address.

I could easily see giving an ongoing commission to a sales rep as a finders fee. I could also see a contractor situation where you retain control of the account and contract it out to services and if you can figure it out, maybe after a year or so "sell" them the account at say 33% or 50% of one year's revenue.
I have considered subbing out the work as you have mentioned. Initially, I had decided not to do so. However, this is something I may have to reconsider with certain services. The downside to this is it will include a degree of "managing" the accounts. I really want to get away from management of the work and focus on what I am happiest doing.... selling.

In my present position... If I could have dedicated 100% of my time to marketing, advertising and sales efforts and not have to worry about the operations, I would have likely breached the $1,000,000.00 sales mark this year. I missed so many sales opportunities because I was bogged down with other tasks.

DiscoDave
07-22-2010, 09:15 PM
Couple of thoughts... If you sign up a stable of contractors how do you decide who to give the lead to?
Yes, I thought of that. I plan to only work with one service provider in each area for each type of service.
On the maint. what is the % on that you will receive payment on? The monthly base, the yearly gross, some other multiplier?
I was considering basing it upon a % of the average number of cuts our area gets per year. I am also considering making it based upon the equivalent to 5 mowings.

ChiTownAmateur
07-23-2010, 09:20 AM
I can understand how some may have this concern. This is something I will need to address.

I
I have considered subbing out the work as you have mentioned. Initially, I had decided not to do so. However, this is something I may have to reconsider with certain services. The downside to this is it will include a degree of "managing" the accounts. I really want to get away from management of the work and focus on what I am happiest doing.... selling.

In my present position... If I could have dedicated 100% of my time to marketing, advertising and sales efforts and not have to worry about the operations, I would have likely breached the $1,000,000.00 sales mark this year. I missed so many sales opportunities because I was bogged down with other tasks.

What would the average profit margin be for the $1mil in business would you say? It's just an average but let's talk numbers and figure out how much profit is in there, how much expenses there are and maybe we can come up with a creative idea or two to help your plan.

Stillwater
07-23-2010, 11:39 AM
My 2c is you deserve 10% of the gross from all accounts that you bring to the table for the life of the account.

that is too much bleeding

OrganicsMaine
07-23-2010, 07:20 PM
Funny that this thread is going....I was just thinking about this today. A friend of my wife's is a single mom who is divorced with a nice monthly check coming in, but wants to earn some money on her own as well. I was thinking about approaching her to sell work for me. My thoughts are 15% for the first year, then 7% the following. Then nothing on that account. This will provide a small amount of residual for her and not tear into my profits too much. She would only sell the work once, then I would handle it from there.

This would be pure commission only, and I would 1099 her at the end of the year.

Thoughts?

DiscoDave
07-23-2010, 09:49 PM
What would the average profit margin be for the $1mil in business would you say? It's just an average but let's talk numbers and figure out how much profit is in there, how much expenses there are and maybe we can come up with a creative idea or two to help your plan.

Tough one to answer. It all depends upon the amount of overhead the company has, how much is paid in wages to hourly employees and how productive they are and the equipment is. These are all things that are variable from company to company and beyond my control.

One option is, I will agree to sell within the companies pricing parameters as long as they are not unrealistic and within the local industries standards. Another option is, I simply sell based upon a set rate based on the local industry standards and the company either excepts or declines the deal.

Az Gardener
07-25-2010, 11:13 AM
I think the % some are suggesting are pretty high especially in the maint arena. At least if you are talking about a company of any size. PLANET puts out a yearly report that lists expenses of the various businesses by area and type of business. It lists sales, profits, pay levels for various positions etc. A very interesting read. As I recall even in the good times profit was below 10% for all types of work.

I know what you mean about creative marketing. I have been working at it for about 18 months and it is really beginning to pay off. My business has grown by over 30% since about March.

DiscoDave
07-25-2010, 12:21 PM
I think the % some are suggesting are pretty high especially in the maint arena. At least if you are talking about a company of any size. PLANET puts out a yearly report that lists expenses of the various businesses by area and type of business. It lists sales, profits, pay levels for various positions etc. A very interesting read. As I recall even in the good times profit was below 10% for all types of work.

I know what you mean about creative marketing. I have been working at it for about 18 months and it is really beginning to pay off. My business has grown by over 30% since about March.

I have not seen THAT particular report. I would assume the profit that is being reported is after all advertising, marketing and commissions have been paid. I know the average maintenance company spends 7% to 10% of gross sales and the average fert. company spends 10% to 15% just in advertising. This does not include commission for sales staff, overhead associated with employing the sales staff (vehicle, literature, benefits, management, etc).

What I am proposing is... I will pay for the advertising, sales staff and all costs associated with generating the leads from my pocket (up front). How many times have you or someone you know invested large amounts of money into an advertising campaign that produced little to no results? That money is gone forever. When you hire me, you only pay for results after they are achieved. There is no initial investment risk.

lawnangel1
07-25-2010, 02:53 PM
Right or wrong I think 10-12 percent is a reasonable number in which I think you would have many businesses chomping at the bit for your service. (I know I would) However 15% plus is pricing you out of many markets, the margins are just not there in maintenance anymore, especially in commercials which is what I presume the majority of what you would be selling.

DiscoDave
07-25-2010, 03:57 PM
Right or wrong I think 10-12 percent is a reasonable number in which I think you would have many businesses chomping at the bit for your service. (I know I would) However 15% plus is pricing you out of many markets, the margins are just not there in maintenance anymore, especially in commercials which is what I presume the majority of what you would be selling.

It will be a balance of commercial and residential. I realize most companies will not be able to or want to pay in the 15% + range. However, I only need one company in each area I service that will.

I have been in this industry a long time and most of my competitors know of my ability to grow a business very quickly. I am regularly asked to consider going to work for them. One company offered a salary of $45,000.00 plus 5% to 10% commission (depending upon profitability) and a company vehicle. This is with him paying for all of the advertising and marketing etc.. In a scenario where I sell $500,000.00 in services for him, he will save money paying me 20% and not having the additional costs associated with generating the lead, paying me during slow times, benefits, vehicle costs, etc. etc.

Stillwater
07-25-2010, 04:45 PM
[QUOTE=Az Gardener;3654936]I think the % some are suggesting are pretty high especially in the maint arena. At least if you are talking about a company of any size.qUOTE]

This is a under statement at the risk of sounding arrogant, I will take it a notch further some of the % numbers being tossed around in this thread are ******ed it is clear some have little experience in this area.

DiscoDave
07-25-2010, 06:26 PM
This is a under statement at the risk of sounding arrogant, I will take it a notch further some of the % numbers being tossed around in this thread are ******ed it is clear some have little experience in this area.

How nice. We all appreciate the sharing of opinions and helping one another out. Especially when advising those who have "little experience." However, referring to other peoples' comments as "******ed" without contributing intellectually at all to the discussion does not make you sound "arrogant." It makes you sound ignorant. Also, as the father of a child with special needs, I did not appreciate your comment.

The facts are... there are many large and successful companies who's business models supports investing a greater % of revenue into their sales and marketing efforts than most of their competitors. I assure YOU sir, these are not individuals that have little experience nor are they developmentally delayed. For example, the owner and founder of Real Green Systems, and a multi-million dollar Scotts Lawn Service franchise that was started only a few years ago, invests upwards of more than 20% on marketing alone. This is his third lawn care company following this business model. I will also refer to a former employer of mine that started his company with only $700.00 and sold it 15 years later for more than $2,200,000.00. In the two years prior to selling, he too implemented a similar business model of paying higher % commissions as well as investing more in advertising and marketing. Thus almost doubling the size of his company in only 2 years.

The reality is, there are several ways to grow a company quickly. All of them requires an investment to acquire the accounts. The method and % of commission I am referring to is only one way to do that. Another way is to purchase the accounts for an even higher percentage of the gross sales than what I am proposing.

Obviously, I am only going to be attractive to a company that is interested in aggressively growing their company and can handle the growth.

Stillwater
07-25-2010, 09:00 PM
How nice. We all appreciate the sharing of opinions and helping one another out. Especially when advising those who have "little experience." However, referring to other peoples' comments as "******ed" without contributing intellectually at all to the discussion does not make you sound "arrogant." It makes you sound ignorant. Also, as the father of a child with special needs, I did not appreciate your comment.

Disco, I find it intriguing you made my post about yourself. Just because you have children with special needs does not make my use of the word ******ed inappropriate. Take that political correctness somewhere else your not a victim hear and my post is not about you but it is interesting you think so.

DiscoDave
07-25-2010, 11:16 PM
Disco, I find it intriguing you made my post about yourself. Just because you have children with special needs does not make my use of the word ******ed inappropriate. Take that political correctness somewhere else your not a victim hear and my post is not about you but it is interesting you think so.

You call it political correctness. I call it being a protective parent. Something I hope you understand... It is difficult to be constantly reminded that one of the definitions of my sonís disability will be used as a derogatory way for people to insult one another. He will always struggle to be socially accepted by "normal" people. He will take notice of the way people throw around the word "******ed" in their mean spirited ways, and wonder if they are speaking about him. He will hear the "short bus" jokes, and wonder why people are so mean.... He is very proud and loves riding his "short bus" to school. I know someday, he is going to be crushed to learn that this will be a source of countless insults that people inflict on one another. I will do my best to soften the blow for him when that day comes.

I hope you realize that these words are not always harmless. The people that the words describe will occasionally hear you and they do not see things the way we do. They take everything personally and they canít simply toughen up or shake it off. It devastates them. All they know is they are mocked and made fun of their entire life. It is in movies, tv and even in there own families. If you do not care that sometimes children can be hurt by things that you say. Then by all means... use the word ď******edĒ as much as you want and be prepared to be confronted by those that care about someone with the disability. However, if you ever feel empathy for the child that will some day come to the realization that all of those "short bus and ******" insults he has heard, was about people like him. I hope you feel compelled to stop saying it and not ignore it when others do. Speak up and say, "You know, that really wasn't appropriate... it was just mean."

I will let you have the last word.

Az Gardener
07-26-2010, 12:08 AM
Disco I don't know where you grew up or what your childhood was like but from where I sat everyone was teased and abused about something deserved, accurate or not.

The only difference between being a greaser, dork, *** or ******ed was who assigned your particular nickname. In the case of "special needs" kids nature did it for you. Lighten up, he clearly was not picking on your kid, and you can't protect your kid for ever, he will be much better off the sooner you let go and let him begin to handle things his own way.

I'm sure you will have an indignant reply so here are my references. I was an only child, we moved so many times I can't count the number of school's I went to prior to my sophomore year when I moved out on my own. You want abuse I'll tell you no one feels pity for the new kid in school. I was the new kid in school at least 3-4 times a year. I was fat and my hygiene was not up to par as a young boy, my single mother working 2 and 3 jobs didn't have much time to help me so I was on my own. I promise I got more abuse than the entire short bus of ******ed kids combined. It made me very strong and resilient and gave me a good sense of humor. I can't say I wouldn't change a thing but you know you get lemons you make lemonade.

I have 5 kids of my own from 5 to 27 and I and my wife volunteer for many school activities. I am a den leader in cub scouts and have been for 5 years my wife is also a den leader for another group. My den has the add. kids no one else could handle. My youngest son has a learning disability he may well be ******ed but they don't use that word anymore. He gets no special treatment except a lot more help with schoolwork and he can kick his older brothers butt. Ours is the house all the kids come to and we are the ones the school calls when they need someone on short notice. We know kids and I don't believe you are doing yours any favors by being so protective. You and your child are only victims if you think you are and act like you are. Which from my seat it seems you are.

JMHO. My sig line below does not only apply to employee's.

DiscoDave
07-26-2010, 12:36 AM
AZ Gardner you are right.

Stillwater, I apologize. I can be overly sensitive at times when it comes to this topic. I just hate THAT word.

My wife and I have 6 children and we have our hands full at times. Our son has autism and we have had a pretty difficult week.

MarkintheGarden
07-26-2010, 12:46 AM
Disco I don't know where you grew up or what your childhood was like but from where I sat everyone was teased and abused about something deserved, accurate or not.

The only difference between being a greaser, dork, *** or ******ed was who assigned your particular nickname. In the case of "special needs" kids nature did it for you. Lighten up, he clearly was not picking on your kid, and you can't protect your kid for ever, he will be much better off the sooner you let go and let him begin to handle things his own way.

I'm sure you will have an indignant reply so here are my references. I was an only child, we moved so many times I can't count the number of school's I went to prior to my sophomore year when I moved out on my own. You want abuse I'll tell you no one feels pity for the new kid in school. I was the new kid in school at least 3-4 times a year. I was fat and my hygiene was not up to par as a young boy, my single mother working 2 and 3 jobs didn't have much time to help me so I was on my own. I promise I got more abuse than the entire short bus of ******ed kids combined. It made me very strong and resilient and gave me a good sense of humor. I can't say I wouldn't change a thing but you know you get lemons you make lemonade.

I have 5 kids of my own from 5 to 27 and I and my wife volunteer for many school activities. I am a den leader in cub scouts and have been for 5 years my wife is also a den leader for another group. My den has the add. kids no one else could handle. My youngest son has a learning disability he may well be ******ed but they don't use that word anymore. He gets no special treatment except a lot more help with schoolwork and he can kick his older brothers butt. Ours is the house all the kids come to and we are the ones the school calls when they need someone on short notice. We know kids and I don't believe you are doing yours any favors by being so protective. You and your child are only victims if you think you are and act like you are. Which from my seat it seems you are.

JMHO. My sig line below does not only apply to employee's.

Dude, your head is on the level, your heart is in the right place, and your words are true.

Disco, I think you have a possibly great idea, and it sounds like you have the skills to make it work. The problem I see is that it is hard to represent and sell other people's work. I think many of us business owners see our customer service and sales as what we do best. I personally would never contract with a sales agent, because sales will be the only thing I expect to do in the future.

I think that your best bet for making bank and having a great time doing it is to partner up with someone who specializes in operations. I know a lot of times people knock the partnership, and I have heard many horror stories, but when it goes right, there is nothing better than having someone who is really on your team.

Stillwater
07-26-2010, 02:13 AM
"euphemisms" you probably would have perferd me to choose a different word than the one I choose to use in my original post that so offended you. But euphemisms sugarcoat the truth of the existence of people who probably donít want us or really need us to feel bad for them so much as they require us to provide equal and appropriate conditions for them. If we really, sincerely do want people with disadvantages to feel the rapture of equality, then we have to treat them as equals, as best and as reasonable as we can and not patronize the ways their lives are different from ours in unnecessary ways. I am not defending the use of that word when used in a disparagingly way and as a mater of fact I would stand beside you in defense of your child in that situation. But you sound as if their is no circumstance where that word would be appropriate. Their was a time when NASA lost a rocket they would say the trajectory was ******ed. Or before the 80's the mechanic would say your car is not running right because the timing is ******ed. We can't protect our children from everything although we may want to but in our hearts we know that would be harmful. Times are changing and not all for the good, their was a time you could go to the park and skin you knee now you just find rubber mulch and padded seats on a swing and a lawsuit for the town. Their was a time you could ride a bike or roller skate without a helmet now your fined or worse your bike and skates are confiscated. Their is legislation in the state of MA. to outlaw the word "******ed" ban the placement of soda machines, and make it unlawful for McDonald's to pack a toy in a happy meal. The department of education is also debating sending "fat" reports home with children who they think don't weigh what they should. The county commissioner of Dallas Texas wants the government to ban the word "Black Hole" because it is racist. All this is under the guise of protecting someone. Heck America can't even defend her borders without being called a raciest. Children have been hurtful to each other since the dawn of time we know this and some people believe it built character and ended with the learning of tolerance. The character and accountability of Americans today is weaker then just 50 years ago, now everyone is offended and harmed by the simplest of things. Having said all that maybe I should have said in my post that "paying excessive commission on sales leads could result in ******ed growth" I apologize for not having the forethought to word it that way. If you get anything out of this post it should be this as I stated earlier in this post I am not defending the use of that word when used in a disparagingly way and as a mater of fact I would stand beside you in defense of your child in that situation should it ever arise.

Stillwater
07-26-2010, 02:31 AM
AZ Gardner you are right.

Stillwater, I apologize. I can be overly sensitive at times when it comes to this topic. I just hate THAT word.



Disco, absolutely no apology necessary your a dad I understand.....

lawnangel1
07-26-2010, 12:25 PM
Putting the personal stuff aside, I think it is a great biz idea that has the potential to make you lots of money in the future. Good Luck.

BD Bone
08-02-2010, 10:41 AM
I believe what you suggest is a noteworthy idea. However, being that we have used a company in the past to help with growth, sales, leads etc...I would be very cautious. You have a lot of obstacles. In our particular county (We are in Ohio as well) there are a dozen or so highly qualified big lco's. Who, where, or how would you make the distinction of giving the account leads to? If I am paying you the same % as the next big lco, I want a guaranteed locked in contract w/a non-compete clause and no future possibility of you forwarding the lead, mailing address, contacts etc.. to another in the future EVER! If I maintain that new client, I am the one who develops the relationship, cultivates the future sales, add-on services and continues the service. I can not justify anything more than an upfront flat-fee based upon revenue dollars generated from that initial contract sale. It would be a % of that and nothing more.

In my opinion, it sounds like you stated you are happiest in sales...If so, it may behove you to seek a large lco within your area to pay you simply to do that privately. The benefits, pay and so forth might be simpler, less complex and pay better that way than to be a "consultancy sales firm"... but that is simply my opinion. In a way, this is not a lot different than some of the others out there.. Service Magic and the like.. So, you offer one difference w/no upfront costs.. but in this economy, that can get very expensive. I would also want as a client demographics, marketing reports based upon the responses you have gotten, etc... that makes me decide in the future of continuation.

Just some of my thoughts. Good luck.. I Think the theory is great, just a lot of details to figure out.

EgansCountryGardens
08-02-2010, 08:12 PM
To make it real intriguing for a company, I would offer to be paid a higher commision of the profit of the job. Not a commision off of the gross of the job. Anyone can close jobs that may not make any money at all for the company if not priced correctly. However, if you offered to be paid a percentage of the profit, then that would be a more attractive deal to the company. I only say this, because this is how we pay our sales people.

Its no risk to the company, it makes the salesperson more accountable for not only the initial bid, but also following through the project and making sure it is done efficiently. Because the more the job makes, the more the salesperson makes. We pay 30% of the profit from the job. After all overhead, labor, and materials are paid to the company.

30% of the profit to the salesperson, and 70% to the company.

OrganicsMaine
08-02-2010, 08:21 PM
I don't think that he was planning on being a part of running the jobs. If he were in house, that would make sense, but because he has absolutely no say in how a company is run, he could be really setting himself up to be taken advantage of.

DiscoDave
08-02-2010, 09:23 PM
I appreciate the great and honest feedback I have received so far. I am absorbing all that you are sharing and will address all of these concerns in my formal proposal.

STL Cuts
10-02-2010, 06:25 PM
Any updates?

lawnangel1
11-23-2010, 09:21 AM
DiscoDave, whats the latest?

Rayholio
11-23-2010, 12:41 PM
I would pay a LOT for FREE accounts..

like 50% of the 1st years earnings. The residual in my business justifies a profitless 1st year, easily.

ONEBLADE
11-28-2010, 07:18 AM
What's the word Disco Dave?

DiscoDave
12-04-2010, 09:46 AM
DiscoDave, whats the latest?

I have met with a few local company owners and they all have a very strong interest in contracting with me. However, I am exploring several additional options.

In order of preference...

1. Selling the services and subcontracting most services except the fertilization programs and the landscape maintenance. If I do this, I still have to manage the work OR get to the point (very quickly) where I can hire an operations manager.

2. Business development and marketing company that sells as an independant contractor for other companies. One of my concerns with this is being at the mercy of the contractor for payment and their ability to be efficient and profitable to ensure I get a commission.

3. I have recieved several job offers as well. I am considering further exploring two of them. The pay plans will increase my earning potential by $20,000.00 to $30,000.00.

4. Staying where I am IF my current employer will change the management structure and compensation plan I am currently on.

For now, I am moving forward with a hybrid version of option 1 and 2 until or unless I come to a realization that one works out better than the other.

Rayholio
12-04-2010, 11:12 AM
I'm gonna throw my 2 cents in here, if that's ok... I'm sorta a marketing, and sales guy myself, who has transitioned to managment thru ownership. I've never been much of technition.. although it comes with the job, and frankly is the easiest.. although most time consuming part of it.

I have found that these services are relatively easy to sell.. If I send out 1,000 of the right letters, at the right time.. I get 10-20 customers very easily.

Door to door works well.. even home-shows produce a profit.. only thing that doesn't is indirect media such as radio and TV...

So.. if it's so easy.. why would I be willing to pay someone else to do it? quite simply.. Man power. Despite constant efforts I can not find employees that are worth a dam. I can knock on 20 doors, and get one sale EVERY TIME. Even after extensive training, and with a background in sales, employees can NOT close 3 sales per day after knocking on about 900 doors.. even with the assistance of door hangers. The direct mail, and other successful marketing ploys require sometimes HUGE amounts of money in advance, and then there are also man power concerns there.

Being in the position I am, I would pay someone like you a LOT of money for 'free' clients because I'm not messing with the personell mess, nor am I fronting money and time.. I'm just holding out my hand, hoping to get it filled by... a broker. who takes his % and doesn't give me the headaches.

On subcontracting: I work with a lot of mower guys who send me work.... many times I'll be forced to do the work, and then wait to get paid. It creates huge problems. It confuses the customer. maybe they have heard of your company and don't like it... one time I was asked to service a lawn that WAS my customer, and I cancelled. when I told the contractor that I wouldn't do it, he had to go find another vendor. There's also a chain of payment. from the customer to the contractor to me. If the customer doesn't pay, the contracter rarely pays.. and somtimes the customer pays, but the contractor doesn't...

My point is; however you do this.. you want / need to be in control. If it were me, I would suggest selling services to customers, collecting payment on the spot (check made out to the company that you're working for.) report the sale so that service can begin.. Then at the end of the week exhange the checks and contracts you collected from customers for your commission... if the company can't pay.. you hold their checks.

In this way there is total accountability. profits, and losses can be EASILY tracked, and you're never find yourself waiting on a paycheck with NO RECOURCE.

Another option would be to have the cutomer write the 1st check to you.. and you keep it as your commission.. they sign the contract, and it's up to the company your working for to do future billing, ect... all you do is fax in signed contracts with the 1st payment allready made, and your commission filled.

I dunno man.. I find the idea of such a business very exciting.. but I don't think you'll be able to do it without a lot of money on hand, or a huge credit line... you're going to need LOTS of people.. and good ones at that.