"Should a Dealer Sales Manager be Selling Accounts? No!" - 06/19/19 Edition
Stephen Says Column
Dear Stephen:
I hear about the great economy on TV and read about it in the Wall Street Journal. I run a medium-sized Herman Miller dealership in a medium-sized market (we are outside of Houston, Texas), and I just do not see the upside potential to this current economy — at least not in my market. We are busy at the very high end of the market (mostly wood), and we are busy at the low end but our bread-and-butter mid market is sketchy.
My boss, the owner, is pushing me to hire more salespeople, assuming this will produce more revenue. Yet, the salespeople I have in place who are good and working hard are not getting the orders like we did two years ago — or even one year ago.
Each new salesperson increases overhead substantially when you add up the minimum guaranteed salary, health insurance, expense account, sharing of an assistant, training ... well, you know. I am concerned about the time it takes for a salesperson to be productive and profitable (about a year), and if there’s a hiccup in the economy I will have to let people go. It eventually will reflect on my performance and the bottom line P&L. So, I would rather play it safe and not hire.
The other issue on my mind is that I have some of my own client accounts. That helps with my income but it hurts my relationship with the sales staff. I am perceived as their competition. The owner likes it that I have client accounts — he thinks of that as a true “sales” manager — so I don’t have much choice in it, but I would like your opinion, as the workplace expert. Why do most dealer owners like their sales managers to also be “sales-people”?
What do they do about these issues in other markets and at other dealerships?
Signed,
The Questioning Manager
Dear Questioning:
I hear a host of stories from dealer clients in medium to small markets around the country, with the details changing depending on the geography and the type of client they specialize in. For instance, some markets are very busy and others slow: Mid Atlantic is booming with white shoe law firms and lobbyists wanting fancy wood furniture for their D.C. or Maryland offices. In NYC, it’s hedge funds, banks, law firms and media with plenty of cash to spend on furnishings. Boston and the Silicon Valley have tech companies. Every geography has a niche. We have searches right now in Charlotte, North Carolina, just for dealers and manufacturers serving banks. Dallas and Houston are big recruiting markets for us, followed by San Francisco. And I know a dealer is busy if they are willing to pay headhunters a fee!
But back to your questions. Here is my advice: If you think you have great salespeople, then track their sales history for the past five years. If they are not making incrementally more sales and commission, then find out why. Those are the sales people to focus on. If it is because the business simply is not there (for instance maybe a big customer left town), then you need to know that. If they are losing accounts for other reasons you need to know why, and if there is no business development but the market is there, then you have a problem. Is the problem the salesperson not doing their job right, or is it your dealer’s responsiveness to your customers? You’re the manager; that is your job to find out and then create a solution. Bottom line to your question is more salespeople is not always the answer. Many dealer owners think new salespeople are walking ATMs and they are not. My advice to you is to slow the hiring and increase the sales training.
And you have accounts, too? Most dealer sales managers do I know. My question to the owners is always the same. Why do your sales managers sell if it disrupts the management line of responsibility and the sales-people view it as competing with them? Any accounts the manager has are accounts the sales team does not have. I know, most dealer owners do not agree with me. Look, someone needs to “manage.” And we know it is rarely the owner! My advice to dealer principals who ask — and they do ask — is always the same. A good part of your dealership’s sales manager’s responsibility is to help their salespeople find and develop new accounts, assist the salesperson in being successful to make commission dollars, and in doing so make the dealership more successful. It’s crazy for a sales manager to also sell and manage accounts. It is counterproductive to why anyone should be hiring a sales manager; which is in part is to recruit, manage and lead the sales team.
So take a breather, examine your current business before you go on a hiring spree, and for goodness sake, don’t compete with your own salespeople.
Stephen
You can send your workplace questions to Stephen at: StephenSays@bellow.press
Questions selected to be answered, will appear in this column. Please use the Subject: Stephen Says for all emails. Stephen Viscusi is a bestselling author, television personality, and CEO of The Viscusi Group, Global executive recruiters located in New York. Follow Stephen on Twitter @stephenviscusi. Like Stephen on Facebook and follow him on LinkedIn.
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