It’s no secret that sales is an industry with high turnover. A Glassdoor survey of a thousand salespeople revealed that 68% of sales professionals plan to look for a new job in the next year, and 45% within the next three months. Only 19% plan to stay with their current company!
If that isn’t foreboding enough, high turnover can also create huge deficits. DePaul University reported that turnover per sales rep costs on average a whopping $97,690. They also noted that out of the alarming turnovers of the businesses surveyed, 50% were voluntary resignations. That’s a lot of potential down the drain.
Why is this Happening? How do we fix it?
Sales talent retention has been an issue for some time now, and researchers and business people alike are working hard to dissect what it is about companies that keeps salespeople standing with one foot out of the door.
Check out the Webinar: How to Retain Your Sales Team in a High Turnover World
Reconsidering Compensation Structure
Not surprisingly, one of the primary reasons salespeople give for leaving their jobs is that they are being compensated inadequately. But Harvard Business Review reminds us that many sales staff who leave solely on the basis of compensation are low sales performers. So, it’s not always just about the salary.
How are your sales incentives structured? Are the higher performers hogging all of the rewards, discouraging any average or low performers from improving? Are your incentives only based on bonuses? Richard Harris of Harris Consulting suggests mixing monetary incentives with non-monetary ones, such as extra vacation time at certain milestones, professional development training, or even a monthly leaderboard.
Wayne Elsey calls this combination the “three Ms,” which are motivation, money, and momentum. Taking the time to structure your rewards and benefits can pay off big time in terms of retaining your sales talent and investing wisely in it.
Opportunities for Advancement
One Harvard Business Review study showed not only that promotion opportunity was one of the top three factors for sales turnover, but also that 70% of the people leaving the company for that reason specifically were top performers. This demonstrates that the savviest salespeople are not content with bonuses alone, but also expect room to advance their careers.
There are two primary factors managers should consider to keep those opportunities in motion. The first is that when looking to promote, look within the company first. This not only encourages employees to stick around, but gives you a plan of action when there is inevitably still some turnover in the future.
Secondly, provide ample opportunities for career development and professional training, like mentorship, conferences, and seminars. That way, those who may not be top performers still have the resources to advance. Show your employees that you want them to succeed and provide the resources for them to truly do so.
Check out this article: Reap the Benefits of Continuous Sales Training with DialSource
Compensation and promotion may dominate the stats, but the overwhelming common denominator of all studies in sales retention is company culture. Glassdoor’s survey showed 71% of sales recruits are likely to accept less money if it means working at a company with great culture. And 78% are willing to accept less if the company sells something they find particularly compelling.
An Anaplan study of 400 salespeople determined that low confidence in the offering portfolio was a top-cited reason for leaving a company, while organizational experts note that changes in the organizational structure without warning and input also play a large part in deterring employees. This relationship with higher-ups is a key component of company culture.
In Season One of the Office, Michael Scott decides “I won’t tell them about the downsizing. As a doctor, you would not tell your patient they had cancer.” In his ignorance, Michael demonstrates just how ridiculous it is to hide things from your employees, showing us that being comfortable with and confident in our management can go a long way.
Sometimes, building culture means there is still a little room to relax at work. The majority of employees say that the secret to a happy work life is having friends at work. In fact, building these relationships can even become more significant than the pay grade. This gives sales reps a chance to swap stories, decompress, and maybe even learn from one another. Not to mention building social skills is actually a good habit for sales, too.
Is There Any Hope?
The good news is, with the proper investments it is possible to retain your sales talent in this ever-changing market. Improving your company is an uphill battle, but it will be easier to carry the load if you keep your solid team around you.