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The Frightening Cost of Employing Sales People Vs Commission-Only

Alexander HowardAlexander Howard

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Sales has always been a volatile industry. It's no wonder that so many employees refer to it as the "revolving door". With the majority of agents leaving their posts within a couple years, companies have no choice but to constantly hire and rehire, cycling out those who perform below expectations. There's a high expense in training and outfitting new employees.

So how can you make sure that those important investments eventually deliver a return?

A 2016 study by the United States Bureau of Labor Statistics found that three million employees quit their jobs in October alone. That's a quit rate of about 2.1% of the working population. And it's a rising trend. The youngest generations of workers are the ones most likely to bounce between jobs, testing the water before realizing where it is they want to settle in.

LinkedIn concluded that, in a workforce study of the last twenty years, "the number of companies people worked for in the five years after they graduated has nearly doubled." Workers are less and less content receiving a small raise at their current jobs, preferring instead to diversify their portfolios and look for the next big opportunity.

In this article we explore some of the costs associated with hiring in-house sales agents/reps versus that of partnering with independent, commission-based sales representatives. Below is a chart that will give you an idea of some of the things you need to think over before starting the hunt for sales new talent.

Expense comparison chart independent sales reps vs employees

Salary, training and absence are three of the biggest drains on a company's time and budget

New employees can take months to properly acclimate to their positions. According to the 2016 Optimization Study by CSO Insights, nearly half of reporting companies noted a ramp-up time of new employees in excess of ten months. That means that the average sales employee has less that 14 months to recuperate your company's training expenses and pull in a profit.

At CommissionCrowd we believe there's a better way. Our goal is to reduce the risk factor in bringing in new talent to increase sales while mitigating financial risk.

We do this by facilitating the full relationship between employers and independent sales agents. Everything from finding, to training and effortless management is covered from right within the platform.

Connecting Your Company With Independent Sales Reps

One of the ways we do this is by connecting you to a our large and ever growing database of experienced reps with existing networks of contacts across the world. We also help you to craft your sales opportunity in a way that's attractive to freelance sales people.

What many companies who have yet to experience working with independent sales reps fail to understand are the main benefits of working with independent sales reps

At a very high level these include:

You'll save time and money, sell more and eliminate the risks that come with an employed sales team.

Find out if your company is right for independent sales agents here:

5 point plan you need to determine if Independent, self-employed sales professionals will be interested in working with your company