Paying a sales trainee a base salary before she really starts to sell makes sense for the right person, two home improvement dealers say. But a third dealer says it's suicide, likening taking that trainee off base pay to “taking someone off heroin.”
An extreme analogy, perhaps, offered by Chris Ripley, principal of Lifetyme Exteriors, a $4 million Boston company, but he believes that paying a base doesn't work. Ripley chooses to let trainees split commissions with the sales manager who runs with them on calls during training. He maintains that this creates a normal pay rhythm, in that trainees are paid a month after a sale. Once they've run four appointments, the manager can decide whether or not to let them run on their own. “It's our way of reaching fluency, to put their feet to the fire,” Ripley says.
PAY ME BACK Matt Hullander of Hullco Exteriors of Chattanooga, Tenn., pays a base to experienced salespeople in training at the $4.2 million company, but when they sell large jobs on commission, they repay him the base. If they have no training, he pays them the same $500 per week but doesn't require repayment. Hullander says he's been burned in the past paying large base salaries. In one instance, it took him six months to realize his mistake. In another case, however, he paid a sales superstar with hefty experience $800 in base per week to start. The salesman, by choice, maintained the deal through the trial period even though commissioned sales would have merited him $1,500 in salary.
Fred Finn, president of Euro-Tech of Chicago and Remodel America of Milwaukee, which together log $10 million in business a year, says his trainees “select themselves” through their success in canvassing for a few weeks. Trainees receive a base, which Finn would not disclose but said was close to $500 per week, an industry standard. “We put them through that trial, and if they don't want to do it, we don't need them on the salesforce,” he says.
Finn typically hires inexperienced personnel. Of his 17 salespeople, all canvassed before taking a sales job. Finn says he sympathizes with guys looking for jobs who might need gas money to get to work. “It limits our ability to hire the right people if we're not paying them something in training,” he says. Once they become salespeople, they're on a draw against commission.
RISE TO THE CHALLENGE If candidates balk at the challenge of 100% starting commission, Ripley introduces them to his 26-year-old superstar who had never sold before — and who now makes $20,000 each month. “Eighty percent of the time people say, ‘I can do that' — they rise to the challenge,” Ripley says. “In the end, I want them to be right. I'm not challenging them to be wrong.”