Replies

1. 
   DanT | May 27, 2006 02:39pm | #1

   On what type of product?  Remodeling, new build, commodity type remodeling (tub liners, kitchen cabinet refaces etc.) all have different structures and amounts.  DanT

1. 
   Pigsooie | May 28, 2006 06:00am | #4

   In this case, I'm talking about decks, screened porches, arbors, etc.

   Generally non-invasive and straightforward projects.

   Frenchy suggested 50% of profit, which seems a very broad, gray line.

   Hypothetical: if the salesman closes a deal on a cookie-cutter deck at the going rate, what should his piece be?

    

1. 
   DanT | May 28, 2006 01:36pm | #5

   I looked into this in may area a few years ago and most in the home improvement industry were getting a base salary, say 6 bucks an hour, milage and 10% of the base project.  Then 33-50% of the upsale of options. 

   So if they sold a 24'X12 deck for on a level lot for $3500 plus upscale railing for an addtional $500 and it would be sealed too for another $350 the sales person (figureing 50%) would recieve $775.00 plus the 6 an hour and milage.  The milage pay I was quoted was minimal.  DanT

1. 
   Pigsooie | May 28, 2006 08:23pm | #7

   Thats exactly the hypothetical breakdown I was looking for. Much thanks.

   If you don't mind, what is your region?

   Edited 5/28/2006 1:26 pm ET by Pigsooie

1. 
   DanT | May 28, 2006 10:42pm | #8

   Central Ohio. DanT

2. 
   frenchy | May 29, 2006 04:09pm | #11

   Pigsooie, 

       Broad grey line?  Shouldn't be.  You have a cost per sq. ft. of your average deck don't you?  I mean you know how much time and how much wood and nails etc. that a basic simple deck  costs don't you?   Now factor in your variables such as access, terrain, ordinances, special requirements, etc..  Add your profit and divide that number by 2  that's 50%

     You don't want to pay that much?

           Fine sell it yourself.. but read my post to Jeff Buck first.  Are you sure you have the required time? 

1. 
   Pigsooie | May 31, 2006 04:32am | #14

   Frenchy,

   I didn't mean to disrespect your good information when I stated: "profit is a broad gray line."

   I was looking for a concrete amount to figure into the sale price.

   Sorry about any misunderstanding, and thanks for the post. It will definitely be information I refer to.

   Soooie!

1. 
   frenchy | May 31, 2006 03:02pm | #15

   Pigsooie, 

       Be careful not to add the cost of commissions into the bid price.. Commisions come out of profit.  If you hire a prosalesman you should expect a dramatic increase in sales.  If there isn't, then the salesman is just coasting on your reputation and really adding very little to the company. 

     That salesman isn't worth his commision.  A great salesman will generate more business than you can handle, giving you the luxury of subbing out some work and allowing you to grow and expand. Check your management ability and inclination first.   You probably will spend far more time managing projects and dealing with issues than you ever will swinging a hammer..

2. 
   BillHartmann | May 27, 2006 03:47pm | #2

   Also what is the saleman bring to the table.

   Just leads? Full design, specification, and pricing? All you do is show up with the materials and a hammer.

   Something else?

3. 
   frenchy | May 27, 2006 07:51pm | #3

   If a salesman can't earn a comfortable living you won't keep him.. It's a tough thankless job that few can do well.  It's the second highest paid profession right after doctors and well ahead of lawyers.  Think in those terms when looking for salesmen..  

     Trust me there are a lot of order takers out there.  Store clerk kinda of sales experiance, what you need is someone who can MAKE A SALE HAPPEN..   What you don't want is the guy who used to be a builder and wanted to stop because it's too hard of work!  A great salesman will work nights weekends and holidays to make it happen..  60 hours a week is kinda the minimum starting and a successful one will easily work 80 hours or more week in and week out..

     It's not the hours!

    It's the success.

     Pay on commission.    typically 50% of the profit in a job should go to the salesman.  From that he should pay his own expenses.  If he is looking for a quarantee or draw you don't want him.. As a profession it's a harsh life.  That's why the pay is good.. The failure rate of new salesmen is over 99%

     Now against that, you have to be up to the mark yourself!

     Don't expect him to sell ship  "er" T   If you have a poor reputation  you might get a salesman who can sell but he'll be slimey, expect it. good ones won't work for poor companies their own reputation is on the line.  Chances are this won't be a career kinda company.  You'll use him and when you realise how much he makes you'll try to cut back, that's when he starts to look for his next job..

     Remember nothing happens untill something is sold so expect to pay well for success.  If he comes to you with a great reputation or successful experiance and you are  a new or start up company, the usual 50% of profits won't be attractive to him, he'll want a chunk of the company..  believe it or not it could be worth it.  Few owner seller companies really amount to anything.  The value of their equipment and that's about it.  However successull well run businesses are worth not only the value of their equipment but also the value of work on their books and something for "blue sky"

1. 
   JeffBuck | May 29, 2006 08:41am | #9

   "A great salesman will work nights weekends and holidays to make it happen..  60 hours a week is kinda the minimum starting and a successful one will easily work 80 hours or more week in and week out.. "

    

   A good salesmen will ...

   a Great Salesman doesn't have to.

    

   btw ... a sucessful salesman will work less and less hous each year.

   Jeff    Buck Construction

    Artistry In Carpentry

        Pittsburgh Pa

1. 
   frenchy | May 29, 2006 04:03pm | #10

   JeffBuck,

     You need to give the rest of the information.. great salesmen don't just wave their little pinkie and have customers appear.  They are constantly prospecting.. They have their own network setup and know who's doing what and when..

     Watch a great realitor at work sometime.. They attend every party and every meeting.  The great ones make friends and know that friends call friends when they get a divorce and need to sell the house or get a promotion and want to start looking for a house..  They have beauticians and barbers who work for birddog fees and collect gossip and rumers. 

     They give out their business card but usually under the guise of,  "here call me,   this has my private cell phone number on it.. "  They want to be your friend..  They are experts at the cheap gift.  when you arrive bearing a gift you are far more welcome than when you arrive empty handed.. But you can give away the family fortune buying gifts.. hence the "homemade preserves" or " Beautiful antique....." I think the whole collecting lures hobby started from someone with nothing more than an old tackle box full of lures and a router!

      I know realitors who buy old magazines and cut out adds and put them under a glass frame.. (they make themselves).   I digress. 

     Great salesmen don't work 80 hours a week or more, unless you count the prospecting time. The party time, the time spent with barbers and hairdressers etc. 

     Great salesmen  use referals and networking instead of cold calls.. If I'm selling porches decks and minor stuff I would know that to make a decent living  I need to sell X number of dollars per week and I would know where and when the best prospects are..   I would know that by knowing all of the neighborhoods, what the rules are regarding additions,  which communities attracked upwardly moble owners who are likely to get promotions that allow them to afford porches decks and such. 

     That sort of information isn't available at the snap of your fingers.. It takes time to acquire.  The commissions paid pays for that time..

1. 
   JeffBuck | May 30, 2006 04:58am | #12

   "Great salesmen don't work 80 hours a week or more, unless you count the prospecting time. The party time, the time spent with barbers and hairdressers etc.  "

    

   yeah ... the time spent living a normal life.

   everyone else does that too ...

    

   for once  ... we agree on something. The great salesman just makes productive use with his downtime. I don't consider that "work time" ... but I agree with your point.

   I myself, make sure everyone knows what I do for a living ... I prospect virtually every waking moment. I don't think of it was work time though ... just meeting new people and making new friends.

   That's what I meant by saying a great salesmen "works" less as time goes on ... great salesmen have figured out how to have more free time and make even more contacts ... plus that fact as they get better ... each close is a little easier.

   Jeff    Buck Construction

    Artistry In Carpentry

        Pittsburgh Pa

1. 
   frenchy | May 30, 2006 05:02pm | #13

   JeffBuck,

     Living a normal life, What's that?  I work on my house and I work at my job the rest of my life is spent resting from work, I try for a solid five or six hours a night and use the tube to fall asleep..  Sitting here at  the computer is usually work (except when I sneak over here)  

     If I'm prospecting for clients, it's work.   I wouldn't go to a party if they were handing out free Ferrari's as door prizes.  I don't socialize, I don't play, I work and rest. period.. I know.  something about Jack being a dull boy should enter here..  

4. 
   Fotze | May 28, 2006 02:20pm | #6

   In the Poconos going rate for a salesman in new construction is about 3%, however some builders deduct items such as well and septic from the sale price and base the commision on the difference.

    

   Janet