how much to pay salesman?

Discussion in 'Business Operations' started by DBL, Jun 13, 2006.

  1. DBL

    DBL LawnSite Silver Member
    Messages: 2,219

    early this year we had a salesman contact us about a job. he was weird but was willing to work for free for a week or so to show us what he could do. let me say again he was weird but he went to ten houses in one day... got 4 lawn accounts... and thousand dollar tree job... and i think 3 or 4 we got mulching jobs. then we liked him so we had to discuss a contract. he got us to give him 25% on jobs he got us. he does all the work on these jobs even if theyre referals from jobs he sells and closes the jobs. thats the major part of his salary..he only gets a few bucks on the lawn accounts. my question is is the 25% on the PROFIT MARGIN too much to be paying this guy. he has been pretty steady but then he broke his leg and has been out for a while.
  2. Brendan Smith

    Brendan Smith LawnSite Bronze Member
    Messages: 1,195

    to me it sounds high. a more realistic figure would be 10% of NET instead of 25% of the entire amount.
  3. harryhomeowner

    harryhomeowner LawnSite Member
    Messages: 140

    25% of something is better than 100% of nothing. How much time can you dedicate to getting new business?
  4. rodfather

    rodfather LawnSite Fanatic
    Messages: 9,501

    if you come across a dog that can talk, you don't correct his grammar...hire that guy and let him make ya some $$$
  5. rodfather

    rodfather LawnSite Fanatic
    Messages: 9,501

    What do ya mean by weird...hell, everyone I just about know is weird in "some way". :laugh:
  6. DBL

    DBL LawnSite Silver Member
    Messages: 2,219

    hes just a weird guy but he can talk and he only gets 25% on the profit margin thats after we pay for supplies employees materials...

    ENDURO LawnSite Member
    Messages: 64

    I wish I could find some self sufficient employees like that. You've found a unique employee. Most lawncare employees are not good salesman. Like the other guy said, 75% of something is better than 100% of nothing. Of course, you do have some expenses, but still sounds like a good deal to me. I would also assume that the high sales commision may motivate him to sell more. If you cut his %, it may cut into his sales motivation.
  8. TPnTX

    TPnTX LawnSite Bronze Member
    Messages: 1,775

    I've got a similar situation. This guy is so good and knows the business well. He can sell and also does the work with helpers I provide. We agreed to 1/3 of the net on jobs he brings in and I'm happy with that. Jobs that are referrals I pay him labor only.
  9. Freddy_Kruger

    Freddy_Kruger LawnSite Bronze Member
    Messages: 1,064

    I owned a window cleaning franchise for while they also had lawn care franchises. I was getting 65% and lawn care was 80% and we didn't even get the jobs.
  10. macomb-lawn

    macomb-lawn LawnSite Senior Member
    Messages: 278

    If he's good, put him on a flat salary plus a small commision. But, put in stipulations like collections, etc. This is how we do it.

    $250.00 a week salary, BUT the employee has to meet a minimum of $4K in sales per month.

    3% Commission (if customer pays on time and in full.)
    2% Commission (if customer is 30 days past due.)
    1% Commission (if customer is 60 days past due.)
    0% Commission (if customer is more than 60 days past due.)

    This is on landscape and snow jobs. Commisison is paid monthly, and only AFTER payment has been recieved on the invoice.

    On lawn jobs, it's 3% flat on the monthly bill. So, we don't pay commission unless the bill is actually paid, and it's paid monthly so if the customer is past due, the commission goes down. The sales rep. is responsible on collecting. So far, it's been pretty good for us. Everyone is happy. Now, our sales director "baby sits" all the sales reps. He's on flat salary. But, all proposals and quotes are reviewed by the sales director prior to "closing" the bid/estimate/sale to make sure the margins are right.

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