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A sales question....

Discussion in 'Business Operations' started by Dirt Digger2, Mar 26, 2011.

  1. Dirt Digger2

    Dirt Digger2 LawnSite Silver Member
    from PA
    Posts: 2,396

    ok guys...so here is a general question, I know many of you deal in sales so you might be able to help me out...

    So the girlfriend is in sales, she gets a base salary plus commission. Basically she has goals so if she makes the goals she gets X-amount plus her salary, if she doesn't make goal she gets her salary pay.

    Anyway last month she didn't make goal so she should just get her base pay, but apparently her company withholds 10% of any unpaid bills from her clients out of her paycheck. So say she has a client that owes $1,000 they would withhold $100 from her paycheck. So she made a lot less last month then even her small salary.

    To me this just doesn't seem right...I always viewed it was the liability of the employer to collect past due monies and it all comes down to how aggressive they are at collecting (placing liens, etc...), it shouldn't be left up to the sales person to not only sell but collect on past due payments as well

    maybe I'm wrong...is this how it always works?
  2. Dr.NewEarth

    Dr.NewEarth LawnSite Bronze Member
    Posts: 1,441

    An interesting and frustrating question.

    What is in her written job description with the company?

    I'm in Vancouver, thus we also have different spelling rules.

    We have labour laws for non-union people. Do you have a labour
    relations act or state law that you can access on line?
    Perhaps through the states website?

    Here, withholding employee funds other than employment deductions, court ordered garnishees or agreed to retirement fund contributions is illegal.

    The labour laws here trump whatever agreement or understanding an employee has
    with his employer. There are retroactive time limits on repaying improperly deducted funds etc.
    Some employers here still screw over the employees with things like not paying
    proper over-time on statutory holidays or even if they work an hour later.

    If the employee (or contractor) speaks up or tries to protect their legal rights,
    they could lose their job or be reprimanded in many ways too. So it is tough.

    I hope some-one from your region can help you some more.

    If her company is withholding money and the sales have been low,
    then employee moral can go down, feelings of depression or anxiety can go up.

    We want our sales people happy and motivated.
    They will operate better in the long run.
  3. Roger

    Roger LawnSite Fanatic
    Posts: 5,923

    I would have to agree with the company's policy. Yes, they have the obligation to collect the outstanding debt, but the account is hers. She is responsible for cultivating the relationship, building the business level, and maintaining the account. She cannot just make a sale, then walk away, without still owning some responsibility for the account, including the collection. If the company didn't utilize the withholding policy, the salesperson could do just that -- make the sale, and walk away. I'm sure the company has seen that happen too many times. The implementation of the 10% insures the salesperson continues to be involved with the account.
  4. Brodie

    Brodie LawnSite Member
    Posts: 122

    It does not seem right to me. I know a lot of people in sales and none of them are responsible for collecting payments. In all cases I know of the sales rep will make the initial sale and then make periodical check-ups on the account to make sure the customer is happy and possibly sell more product. Following up on payment is the responsibility of the accounts department.

    I use sales people at the start of each season to bring in the bulk of our new clients, I know it is a different situation but when they are here they are just selling to new clients and checking in with the previous years clients. Why is that the only thing I have them do?
    Because that is what they are best at. I have an account manager to generally talk to customers about concerns or extra work during the year and sometimes do the odd sale but my accounts managers main job is to collect payments. That is what he is good at and he knows all the legal in and outs and proper ways to collect money and if needed proceed to suing for our money.

    My point is sales people are good at sales that is the only thing they should be focused on. Not collecting payments. If you hire some one to make sales then you want them to be making as many sales per day as possible not chasing people for money all day.
  5. Roger

    Roger LawnSite Fanatic
    Posts: 5,923

    Brodie, you are right, sales people should not be the ones making collections, they should be doing sales.

    But, they are the primary contact for serving the account. That does not mean collections. By paying the 100% the sales people have less motivation for servicing the account. Collections/accounting are the ones to get the money, but the sales people are not going to do well in keeping the customer going for the follow-on sales unless they maintain contact. Getting the money transaction completed in necessary for the next round of sales. That alone should be adequate motivation to keep the account current, but, in this case, apparently, not so.
  6. snomaha

    snomaha LawnSite Senior Member
    from midwest
    Posts: 896

    Agree - I want my sales people qualifying the sales they are making.
  7. bohiaa

    bohiaa LawnSite Fanatic
    Posts: 5,220

    I know RIGHT.........

    I have herd of people working at cash registers being held responable for the till comming up short and taked from there pay cheek, " this doesn't seem right too "

    right now Bells Dept store makes there sales people sgin up so many people for a credit card or there fired.....

    somethmes I think we " the public " allow some companys push us around.

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