Sales Warrior Lesson 52
Physical and Psychological Space
Salespeople are usually compensated for making sales not
profits, and most salespeople sell what they are best compensated for selling.
Most sales compensation system are put in place to direct salespeople to do what
is best for the company, but compensation systems are never perfect. Indeed,
within a company, compensation systems can create contradictory incentives.
In the early days of selling microcomputers, I ran a
retail computer store for a large national chain. My compensation was based on
the profitability of my store. My district manager's compensation, however, was
based on sales volume. I could have increased volume and sacrificed
profitability, but I choose instead to run of the most profitable store's in the
nation, which earned me both a large bonus and a problem with the district
manager who wanted to replace. Within a few months, we both got what we wanted:
I was promoted to a new position of National Accounts Marketing Manager.
No matter what your sales incentive system, your company
survives on profits alone. If your company is not profitable, you cannot be
successful in the long run with them. It is only a matter of time until their
position becomes untenable.
