To encourage and motivate your sales team, you must not only focus on the sales representatives but also on one important individual who is responsible for leading the entire team, the sales manager. An effective sales manager is one to offer good advice and coaching to his or her team. Whenever there are sales-related problems, a manager often steps in to offer their expertise in navigating the situation. And just like any other employment with the business organization, it is important to also encourage your sales manager by offering the right compensation plan. Learn and read more about this below and should you need any help preparing a compensation plan then check out our free sales manager compensation plan samples that are available for download on this page.
10+ Sales Manager Compensation Plan Samples
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What Is a Sales Manager Compensation Plan?
First of all, a compensation plan is a combination of the salary and various benefits an employer offers you in exchange for employment. For sales managers, their pay should be measured on their team’s performance and other important components related to their managerial duty. In order to be able to hit your company’s targeted sales, you need a capable employee who can lead the sales team to success. Attracting the right candidates for the job would mean building up an attractive compensation plan. A sales manager compensation plan is not only built on higher salaries that are usual for those who are at a managerial level, but this should also contain other components like achievements and not just the percentage of profits. And of course, also included are the usual benefits any other employees are entitled to such as bonuses, incentives and etc. Basically, a compensation plan will depend on the what the company policies and its practices.
How To Create a Sales Manager Compensation Plan?
A sales manager may play several roles in a business organization aside from coaching his or her sales team. As he or she would be in charge of hiring new members for the sales team, collaborating with other departments in the organization, and prioritizing deals and opportunities. Take note that a sales manager’s compensation plan is to incentivize leaders so they may motivate their team so that they generate a lot of sales revenue. With a lot of responsibilities on hand, the importance of creating a well-crafted compensation plan will ensure that you are able to reward sales managers for their outstanding sales performance. Here are several tips that will help you create a successful compensation plan for your sales manager.
I. Sales Behavior
Identify different sales behavior that should be able to support your overall business goals. This will eliminate uncertainty and set out clear expectations.
II. Higher Base Pay
With an extent of responsibilities and the pressure to ensure the team reaches its sales target, a sales manager’s base pay must be higher. So they are motivated to do their duty as expected of their role.
III. Comparing Data
Data from previous sales performance can help develop a compensation plan. By comparing data you are able to understand how managers are compensated. This will set ground rules on how sales operations should be done to help achieve goals and motivate managers.
IV. Stock Options
Some companies offer managers even their employee’s stocks as an incentive. But managers being higher in rank should be offered more to reflect their greater stake in the company.
V. Other Incentives and Benefits
Aside from the usual benefits such as health insurance, paid leaves, bonuses you may want to offer benefits such as loyalty awards, incentive trips, allowances, and other things. As long as the company could afford it, then include this in the compensation plan.
VI. Clear and Direct to the Point
Make sure your plan is understandable and direct to the point. You don’t need to force yourself to add benefits that are not feasible in the end. This is why you should initial do your research and compare data to come up with a compensation plan that will not only benefit the sales manager but the company as well.
Is it Important To Have a Sales Manager?
A sales manager plays a pivotal role in a company, as they are in charge of achieving the sales targets and eventually generating revenue for the organization. Their responsibilities include managing their target, recruitment, motivating and training the salespeople, managing the operation process, handling complaints, executing marketing strategies, and many more.
What are Employee Incentives?
These are rewards and privileges that motivate employees to meet business goals.
What Is a Sales Representative?
These are individuals who present and sell products or services to organizations, businesses, or government agencies.
A well-crafted sales manager compensation plan will help your company acquire a steady stream of high-performing candidates. Which in the end can be very beneficial for the company. Employees whether managers or rank and file are the major backbone of every business operation and one way to motivate them is by presenting an attractive compensation plan.
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