How Philadelphia-area businesses pay their salespeople — and keep them motivated | Expert Opinion

The nation’s unemployment rate stands at about 4%. But it’s only 3.2% for workers in sales and related occupations.

That’s because even when business slows, many of my clients are reluctant to let good salespeople go. They’re counting on those employees to bring in new customers and keep existing ones.

But how should they pay them? For Philadelphia-area businesses, there’s no single formula. They might choose from several different approaches.

One way is to keep compensation simple by paying salespeople a commission based on both new and existing customers.

This is how salespeople are paid at GLOBO Language Solutions in Wyncote, says senior vice president Jenny Esno. GLOBO helps organizations communicate with their employees, customers, partners, and suppliers across languages. The company uses thousands of linguists and employs about 15 salespeople.

“We compensate with above-average earnings through a built-in model that allows a senior account executive the opportunity to nurture and grow the accounts they serve,” Esno said. This structure is designed to retain high performers, she said.

New Jersey online retailer Adagio Teas pays their two salespeople a base salary and a percentage of sales.

“The plan aligns the company’s performance with salespeople’s compensation,” CEO Michael Cramer explained, adding that “high performers are rewarded with growing commissions.”

Anchor Pest Control in East Brunswick, N.J., also pays its salespeople a base salary plus commission. In addition, the company runs monthly sales contests, according to company president Carmen Reino.

“We’re a very competitive culture here,” he said, “so everything we do is based on competition.”

At First State Building & Design, a residential construction firm in Chadds Ford, a successful project delivery is just as important as making the sale, said general manager Micah Weeks.

“In construction, a sale doesn’t end when the contract is signed,” he said. “Poorly scoped or poorly priced work creates problems throughout design and production and ultimately affects the client experience.”

This is why, for him, it’s important to incentivize successful projects.

“Our approach keeps sales aligned with the overall success of the project, not just getting a contract signed,” he said. “That means selling work that’s properly scoped, appropriately priced, and positioned to deliver the quality and client experience we expect.”

Mount Laurel-based Roosevelt Paper pays its 36 salespeople a salary plus monthly bonuses and incentives, CEO David Kosloff said. That makes the compensation split approximately 50% salary and 50% incentive pay. Newer salespeople receive a larger salary component.

“Our approach, starting over the last 10 years on the sales side, is a team concept with selling, where every account is shared between the inside and outside sales person,” said Kosloff, whose company has 350 total employees.

Although this approach is important, Kosloff wants to make sure he’s recognizing the best performers with a separate monthly bonus.

“Even though there’s a team concept with each account having two sales reps, there’s an individualized incentive,” he said.

Several executives stressed that salespeople are not just motivated by compensation. Most want to be better at what they do. So a low-performing sales representative should not simply be terminated. Coaching could be a better solution.

At GLOBO Language, Esno says she works to distinguish those employees who need help developing skills from those who just lack motivation. She says that for lower-performing salespeople, the company evaluates whether performance issues stem from skill or motivation. Then it establishes a clear, time-bound improvement plan and provides hands-on coaching in the field. Reino is using AI to help train.

“We now have some AI programs so that for every call, a sales or customer service representative will get an email at the end of the day with feedback and suggestions for things they could have done better,” he said.

It’s important to make sure that reliable numbers are being used to best evaluate a salesperson’s results.

“In all cases, performance decisions are importantly guided by verifiable data,” Esno said. ”Because we rely on the success of our sales team, maintaining data integrity aligned with scorecard metrics is essential for measuring performance accurately.”

Anchor Pest Control’s Reino believes that clear performance expectations should extend beyond the sales department.

“Everyone has clear metrics from salespeople to customer service representatives, to management, to technicians and everyone knows what their numbers are supposed to be,” he said. “If they’re not meeting their numbers, we have an improvement program. We’ll put them through coaching.”

For business owners, the lesson is to decide what a successful sale looks like before deciding how to reward it. Build the compensation plan around that outcome, make the expectations clear, and give employees the coaching needed to meet them.