TheColdCaller

Sales Manager

Do you think a sales person can be considered overpaid?

I believe sales people are significantly underpaid/under appreciated when they start their careers. On the flip-side, do you think a sales rep can be overpaid after closing several large accounts that give reoccurring commission regularly with little to no effort after the first initial order? I tend to go back and forth on this and I'd like to hear everyone's thoughts.

Can a sales person be over compensated

Attached poll

Yes No Indifferent

*Voting in this poll no longer yields commission.

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💰 Compensation

49 comments

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snazzy

Praised Answer

This would be a subjective answer in most cases. Blanket statement: Good, hard-working salespeople deserve a lot of $$$. There is no 'go home, the workday is over' in sales. If you think of the hours legitimately clocked every week, I'd argue that we are all getting very underpaid!

Incognito

WR Officer

Master of Disaster

@snazzy 🏆

Incognito

WR Officer

Master of Disaster

I can literally name at least 10 ppl in my company right now making at least 100k base salary who are completely useless, lying trolls. They have brought in exactly zero revenue and faked all their activity.

meanwhile, we have no money for what actually makes money and keep on hiring more idiots.....

TheColdCaller

Opinionated

Sales Manager

I can see where you are coming from @Incognito . I am more talking sales people that did not inherit big accounts or get warm leads daily. This person created the lead themselves through hard work in the beginning and made it big. Low base, but high commission. I feel like everyone's situation is a little different. Also, I hate to say it but age/experience makes a difference in employers eyes.

Incognito

WR Officer

Master of Disaster

Um...... not mine apparently 😂

but yes, I get where you’re going. If someone worked their ass off, got a big win and the residual income stays fat, then they earned it.

SalesPharaoh

Big Shot

Senior Account Executive

I agree with this logic, but regarding coasting in high revenue areas it's whrre I feel the base or commission can be lower. If their job is like custo.er success where it's just account maintenance and making sure they resign so i don't know what would be fairer

justatopproducer

Politicker

VP OF SALES -US

You must work where I do...

SalesPharaoh

Big Shot

Senior Account Executive

Did they get promoted to get there?

Incognito

WR Officer

Master of Disaster

@SalesPharaoh nope. Hired from wherever. No important experience necessary 🙄

on the flip side, they did hire me and I came from an entirely different industry. But I have a sweet Rolodex so 🤷‍♀️

SalesPharaoh

Big Shot

Senior Account Executive

Nicee nicee, i understand unfortunately i have to agree with you because i feel you. Board hired people from big telecom to run a scaleup. Problem is that salespeople from telecom usually rely on products that sells themselves. Now join me no one got a big deal infact some tried to shark me and ruined it for all of us.

Incognito

WR Officer

Master of Disaster

@SalesPharaoh 💯

the worst is that corporate is so tone deaf that they don’t realize that these idiots are polluting the brand. I don’t want my name associated with these asshats.

SalesPharaoh

Big Shot

Senior Account Executive

@Incognito It's frustrating because I feel in order to go through change in this magnitude would be costly. Also I guess management wouldn't feel what you and I are feeling as long as the ship is sailing.

MSPSales

Politicker

Partner Development Manager

Hell no we are not overpaid. We are in a role where most of our livelihood comes from commission in a high stress job with little to no job security.

1) Without sales the company wouldn’t make any money organically

2) Sales is not a 9-5 job and you would be hard pressed to find someone willingly to do what we do without adequate compensation

3) We don’t get much support. Marketing opps are hit or miss. Sales managers don’t do much other than telling us to sell the way they do or just asking about pipeline.

4) Our quotas always go up while compensation usually goes down

We put up with a lot to get paid really well if we achieve.

You of course get colleagues who are lazy and coast off good territories etc. But you will find that anywhere. Lazy people be lazy ya kno

CadenceCombat

Tycoon

Account Executive

Anyone can be overpaid. It all comes down to what value the employee in question is generating and that doesnt always translate to $$$

Haast

Notorious Answer

Account Executive

Yes in salary, No in commission.

SalesPharaoh

Big Shot

Senior Account Executive

But if they negotiated for that salary and the other party accepted it so? If they don't feel it's unfair why should we?

Haast

Notorious Answer

Account Executive

Fair point, problem is some salespeople are better at negotiating a salary than they are at ultimately selling the product (since that is difficult to know up-front when interviewing). Since sales people tend to be quite communicative about these things across the org, the combined visibility of a higher salary than their peers but lower performance/attainment can cause good salespeople to leave that company or approve less of their employer/management.

SalesPharaoh

Big Shot

Senior Account Executive

I agree the best salespeople sell themselves. But what are ways to improve this?

Haast

Notorious Answer

Account Executive

If i knew i'd go join Ops!

Suppose you could try conditional/ramp performance based contracts, but not many actual top performers would go for that if it meant leaving something certain.

ChangeTheChannel

Good Citizen

Channel Sales Manager

Of course a sales person can be overpaid.

We all know people who coast on good territories or good accounts and game the system/metrics. Isn't that like half of why we're in sales to begin with?

Theoretically a good comp plan should disincentivize this type of behavior but there plenty of people comfortable at hitting 90-110% of their number doing the bare minimum, or less.

TheColdCaller

Opinionated

Sales Manager

I think you're right @ChangeTheChannel

Do you think it is fair for the employer to restructure the employment contract? I feel like no matter what role you play in a company or how much you make if someone takes money away from you, you'll be upset and start looking. Thoughts???

ChangeTheChannel

Good Citizen

Channel Sales Manager

Whether it's fair or not is irrelevant.

But the more common approach companies take will be to raise quotas to an unattainable level and hope that kicks out their overpaid reps.

CaneWolf

Politicker

Call me what you want, just sign the damn contract

Which often just kicks out the good reps who go "well, that's a bunch of crap" and walk out the door.

SalesPharaoh

Big Shot

Senior Account Executive

Ok that is very good points there. But then if they got a contract they negotiated for it, are they to blame?

Trinity

WR Officer

BusDev

If they continue to create new POs (add-ons) with existing clients because they regularly check-in/continue to build the relationship, I think they should get the commission.
But if they're just an order taker or someone else managing/maintaining the account then they should not get commissions.

fuzzy

Notable Contributor

CMO (Chief Meme Officer)

I know salespeople who definitely do not deserve their pay. But, it's nothing to do with their deal size and everything to do with the lying sacks of shit that they are.

TheColdCaller

Opinionated

Sales Manager

Wait, what do you mean by that @fuzzy ? Are you talking about lying and overpromising to their clients or lying to their employer?

TheLoneGun

Opinionated

Extremely Rad Product Offloading Specialist

Salespeople are inherently lazy. So if someone inherited a solid territory, book of business or negotiated a huge salary. Maybe.

However a sales persons value can easily be quantified, so even those who have a great territory but contribute little to no growth can get shit canned.

SalesPharaoh

Big Shot

Senior Account Executive

Exactly 💯 they are the easiest to terminate because all this effort goes to simple numbers and % if they meet them you're good if they don't good bye

DaveyDimes

Acclaimed Answer

Account Executive

You gotta pay your salespeople enough where they can survive as they ramp.

I've always loved the 50/50 base to commission split uncapped. If a rep is crushing it they deserve every penny of the commission.

For those reps who are building books of business, those jobs can be super volatile. In many, you don't have a base or have a limited drawer. Those who can survive and close career deals usually deserve it. It's also worth keeping the rep around long term to maintain the relationship with the client which they have to do in many cases.

Kanyebut4sales

WR Lieutenant

Account Executive

@TheColdCaller To say that you can be overpaid for your effort also says that you can be underpaid for it....which definitely is possible....but sales isn't about being paid for effort it's being paid in correlation to the results you bring in.

We get a piece of the revenue we generate. Sometimes we get a base pay to sustain us financially and emotionally so that we can focus on creating those results. If we don't generate those results we can get fired because we become unprofitable.

PeterSwan

Opinionated

Sales Specialist

No - most definitely not overpaid. I'm with Corp on this when he says "either you build a product or sell it".

HarryCaray

Notable Contributor

HMFIC

No, as long as it's legit pay for performance. Eat what you kill.

Captain_Q

Arsonist

Sr. Account Executive

To the individual that believes salespeople are overpaid. You’ve either; 1. Tried it and failed or 2. Have never tried it. When did people start looking at sales like some secret society? Are waiting for Joshua Jackson, a.k.a. Luke McNamara, to abduct you in the quad and offer you a spot on the squad?! Pretty sure there’s an open invitation to apply, for anyone that has the drive and mental fortitude to deliver at a high-level DAY IN AND DAY OUT. Join the club, sucka!

TheColdCaller

Opinionated

Sales Manager

@Captain_Q Just picture an account has grown to 50k commission yearly with maybe 20 hours of total work a year. You wouldn't feel guilty at all for that? Is there a number/scenario in your mind where a sales person can be overpaid? I am not saying they are, but I hope you can see where I am coming from.

Captain_Q

Arsonist

Sr. Account Executive

So, I think that there are a lot more moving parts in your scenario. Do you competitors sell a similar product? How long has that account been buying from your company and/or from the rep directly? When you refer to revenue growth and hours contributed, you are forgetting to mention all of the intrinsic value and relationship building your rep has put in. What was the accounts YoY growth the previous 3-5 years? Has there been a change there? If an account is truly growing with no touch required, then yes, maybe it should be moved to a house account. However, if you do that, who will handle all of the support calls? Who works with the customer when they want to leave for the competitor? If a company builds a reasonable revenue model with enough margin, then why shouldn't a rep continue to reap the benefits of a longstanding customer?

TheColdCaller

Opinionated

Sales Manager

I agree nothing is cookie-cutter in sales. Lots of competitors in my industry. So this rep brought in the account a couple years ago. It was a tough one to pull down. Lots of hours. But since then it has been steady growth with almost no maintenance on the rep side of things (lots in operations). Sales person receives the quotes and sends the prices right back. That's it at this point really with a visit or two a year. So in the foreseeable future the rep could make 50k-75k theoretically on one account alone with almost no effort yearly. Rep oversees the relationship. Don't get me wrong, the company is winning too, but not quite as much.

DentalSales

Good Citizen

Managing Director

Can a rep be overcompensated? Sure. But I would doubt that happens all too often. Every company I've worked for raises quota year after year in what eventually becomes a game to limit a sales rep's income potential. HBR has an interesting take on this:

"For instance, the research suggests that caps on commissions, which most large companies use, decrease high-performing reps’ motivation and effort. Likewise, the practice of “ratcheting” quotas (raising a salesperson’s annual quota if he or she exceeded it the previous year) may hurt long-term results."

https://hbr.org/2015/04/how-to-really-motivate-salespeople

Reps should be well compensated, in my opinion, but not to the point where it hurts the business. On the flip side, too many execs look at sales as an expense that should be cut instead of the key to revenue gen that it is.

DustyGreenField

Good Citizen

EVP, Sales

I've been canned 2 times due to being "too expensive" - usually around the 18-month mark. Quota on new opps and compensation on sold business should be decoupled.

Adslanger1

Opinionated

Senior Account Executive

6 out 9 of my teammates are overpaid
but honestly in a few months I will pass em all up and make more so fuck it

Onemoredial

Valued Contributor

Account Exectutive

Of course people can be overpaid, you can be put on an inflated base, or the commission structure could be overly generous and actually reducing productivity

Salespreuner

Big Shot

Regional Sales Director

Value delivery matters : always need not be $ ; it could be mentoring, experience sharing, best practices implementation and lot more!

employee being discussed needs to be seen as a whole!

Ace

Arsonist

CEO

If they're deserving, then why not

The_Sales_Badger

Notorious Answer

Account Executive

Sales is a grind. That's why everyone can't do it. The only people that think salespeople are overpaid are salespeople. That's right, I didn't have a stroke. The bottom-feeder salespeople are jealous of the President club winners, attributing their wins to luck.

It's crazy though - top-tier reps seem to get lucky every year... meanwhile, those haters are begging recruiters to help them get an easier job.

LordBusiness

Politicker

Chief Revenue Officer

Unfortunately, there a lot of sellers who have, and will continue to be over paid. This (I find) is most common in the enterprise game where they have support team of sales engineers, SDRs, product, etc. Nothing drives me more insane than my sellers who forward simple shit questions over to support teams because they are two lazy to execute on them. These are the types who complain about spending their time "not selling" (what does this even mean?) - everything is selling, every little piece of the process is selling.

Trinity

WR Officer

BusDev

It depends. If they're an order taker then yes

Chep

WR Officer

Bitcoin Adoption Specialist

Really depends. Someone once said to me "It's the hands you shake not the grades you make that determine your success in life" and I feel like that quote is pretty applicable to this

AlexT

Politicker

Account Executive

Personally, I am keeping an eye on my price/value ratio from a company standpoint. If I bring 10x what I cost them per year they would be dumb as f to sack me.

I have seen people hired as senior with a bloated base that should have been fired faster for doing nothing.

But to go back to your question if you have earned the skills to be trusted with big deals that bring big rewards and you bring them home for the company, then why would you be overpaid? It is not a free handout.

CuriousFox

WR Officer

🦊

For all of the shit I have to do? Hell I'm underpaid.

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TheColdCaller

Do you think a sales person can be considered overpaid?

Can a sales person be over compensated

49 comments

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