Sales incentives.

It occurred to me today that coming up with sales incentives isn't the easiest thing to do. So I figured I would share my thoughts and any other sales managers with a similar problem may take heart that they are not the only ones.

I have a team of 7 sales people. The newest has been here a week. The longest serving 6 years. My longest serving sales person creates 30% of our revenue.

Now sales people out there will be crying out "obviously he is the one that should win Sales Person of The Year" and before I was a manager I would have agreed but that would miss the point of incentives. I want to motivate the whole team and if there is going to be a clear winner of the incentives scheme before it has even started the others will not take anything from it.

So my solution...
I started by looking at the things I wanted to increase. Sales activity, yield and of course revenue. I decided the best marker to use was money that the company hasn't seen before. So all new business will automatically count however my top guy has 70 clients to manage and doesn't do much new business. His revenue comes from increasing the spend of existing clients. So if a client spent £10,000 with us last year and this year they spend £15,000 then £5000 will go towards their total on the incentive scheme.

That doesn't necessarily increase the number of calls and visits the sales guys are making so to be included in the scheme they must have hit their KPIs for that week.

I think this is a fair scheme and hopefully will increase the activity and as an automatic consequence the revenue. I'll tell you if it worked this time next year.