Using Freelance Sales Reps

Using Freelance Sales Reps






In a similar vein, an increasing number of businesses across all sectors, industries, shapes and sizes are using freelance, commission only, sales reps as a natural solution - and an easy way to avoid the high fixed costs of managing an internal sales team.

However, as a vital element of any business, sales certainly isn't something you want to mess around with. So, what should you look out for when considering using freelance sales reps?

  • Associated costs - Sales reps are often seen as a flexible alternative to employed sales people - and they are - but you still need to look at more than just the headline rate of commission you pay. You'll also need to factor in ongoing recruitment expenses, training costs, provision of materials, expenses, management time ....
  • Finding the right rep - For some reason, some businesses are less vigalent about who they let represent them when there's no fixed salary to be paid. Every representative that sells on your behalf is a representative of your business - and as such can both generate new business and damage your reputation. Check references, go for solid track records and lay down clear expectations.
  • Management time - Freelance sales reps don't have to turn up on a Monday morning, in fact, they don't have to do any really. Make sure to allow for plenty of management time in dealing with - and motivating - your freelance reps.
  • Creating the right package - All other things being equal, paying by commission only is more expensive as a % of sales than paying a salary or wage. Some products and services can attract commissions as high as 50, 60 and even 70%. Good representatives have no shortage of options when it comes to what they sell - creating a package that excites them is often difficult.
  • Keeping an eye on results - Again, it's easy to assume that since you're only paying out for what comes in, any business is good business
  • Long-term and client / customer management requirements -- If you sell a product or service which requires long term ‘account maintenance' to help get the most from your client base (i.e. repeat sales, gradually growing account values) then freelance reps are probably not the best bet for you. If you do decide to use them, make sure to build in a hand over process whereby your reps introduce a new customer and someone else manages the relationship.
  • Loyalty and turnover - If your freelance rep leaves tomorrow, what would happen? Could they / would they take your client list with them?
  • The opportunity cost of underperforming reps - You're never going to get a 2nd chance to make that 1st impression - bad reps can actually harm your business.
  • Consistency - If you're relying on freelance reps to deliver your weekly sales target, be prepared for a rocky road. Freelance means just that - free - and since you do not employ freelance reps they can come and go as they please. What will you do if your top rep goes on holiday for a month, drops your services from their portfolio or simply disappears off the face of the earth?

 

Mark

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