jjabara

I am trying to establish sales goals for my employees and our new manager. We currently pay our employees 5% commission on packages and lotions. I am looking to further "compensate" them for increasing sales. I am not sure if I should use their PTA and LPPA(PPTA) and then commission them for a certain % increase that way.

Also for managers....how do you measure and compensate your managers for increasing sales etc. And how often?

Any ideas and suggestions would be helpful

crosbytan

I don't pay my employees commission for packages unless it is a 3 or 6 month package. customers walk in the door to tan. the employees aren't selling tans unless it is an extended membership or an upgrade. i pay 3% but have secret lotions in the store that are "harder to sell" on those bottles i raise the commission up to 10%. I look back at the previous year and raise the monthly goal by 15-25% and as extra incentive if the girls hit their goal then I will make a purchase towards the salon that they want. for example last month i bought the Tan Track system. This month I bought a new 10 min super bed and XM radio for the salon.

Steve Underhill

If you want your manager to drive sales you should structure her pay around sales staff performance. If you have someone under performing it cost her. If the staff performs at a high level she benefits.

Sales staff should receive commission on products and EFT's sold. There should also be special additional perks paid when you run in store contest for a specific lotion or tanning package. These should be short term contest.

You get what you pay for when it comes to your staff. it is also very important to have monthly sales training meetings as well as a training period of at least 2 weeks before a person is allowed to sell. It is up to you or your manager to properly train your staff.

You can't hire someone and just say now go sell.

__________________
Stephen Underhill
Consultant
steve@smuconsulting.com

suncitypembroke

I use to give commission to my emplyoyee and it didnt change anything as how they sell or work, so I took away the comission and gave them a small raise and this seem to work better for awhile. As a owne you are the captain of the ship and how the ship is run is how it going to sail . So with that said it up to you to run the sale ad and what going to be the special of the week . When the campain is successful the customers come in and spend $$$$ so what are the employee doing as far as sale.... nothing so you give $$$ away for whay you did to bring them in. It better to give a bonus as to how they work .( Gift card for gas etc ) This will alway earn you good standing with emplyoee, and a tax write off.

SunseraWarman

How does this benefit your staff? You need to give your staff the incentives not YOUR salon.

When we hit salon goals (which are always 10 - 20% more then the previous year) then all the girls get a cash bonus.

Steve Underhill

If a commission on some packages and lotions did not work for you, it was not set up properly and not supported with training. Just raising pay is rewarding a person for showing up. If they get paid the same no patter how much they sell, what is the motivation. Sales by design is a performance reward position. So many things are not understood by operators that translate to lower income.

__________________
Stephen Underhill
Consultant
steve@smuconsulting.com

suncitypembroke

Here what I found as to getting information to my emplyoee how to sell, had someone come in and give a talk on how to sell lotion , from Devoted ,did all I could to get the information they needed to sell, and still it the same result, LAZINESS , I keep telling them to ask about lotion and if they are not using ask way and tell them why it critical to use lotion as they tan, nothing. How the saying go you can lead a horse to water but you cant make them drink it. They cant remember to give the new customer free eyewear and a packet of lotion.I want customer to see what it is and the important of lotion and eyewear together.So giving them % dont work for me. Believe me I given 10 % on lotion and 3% on packages , and still got the same result.

peach

I agree. Paying commissions is counter productive in many ways. 1) you pay commissions many times on things that would have been sold anyway. 2) It makes your people "pushy", which may or may not help sales but definitely irritates your customers. 3) it doesn't encourage people to perform relative to their peers (ie no team concept) 4) it doesn't encourage all sales, just the big packages / expensive lotions.

At my store, every month is a sales contest. I have bonuses each month for 1) highest individual total sales, 2) highest individual lotion sales and 3)team-for total monthly store sales goals.

sbt501

We pay commission on lotion sales, employee must reach a minimum amount of sales to get commission. We also pay commission on Hp sales and upgrades.

Peach I believe your perspective is short sighted. If your employees are understanding your clients needs and goals and selling based on those needs, they will never come off as pushy.

As far as performing relative to peers the incentive is when 1 employee make $500 in commission and the others makes considerably less.

peach

I compete with big franchise stores, and that is the #1 complaint of people who switch to me; pushy salepeople, reason: commission sales structure with no flexibility. In these stores, they will not sell you a single visit or a packet of lotion. They push EFT's and $100 bottles of lotion on everybody that walks through the door. They are not worried about the needs of customers, they are worried about their commission checks.

Commissions do not create competition between employees; they are not competing against anyone. They are "free agents", which means that they don't really care how the store is doing or their fellow employees for that matter. They might as well be door to door salesmen. You have created a bunch of self centered, self absorbed humans who just happen to go to the same place to work. Actually, that is perfect model for our current generation if you think about it. I'll bet they tell their friends and customers to only buy things from them when they are in the store.

If you are motivating them with those parameters, that will be your result.