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or propane customers, along with equip-
ment sales and service, is the lifeblood of
any retail energy company. Unless you have
the time to spend seeking out prospects
and following up sales leads, having a sales
staff – even if it just a single salesperson –
is a necessity.
Whether you are seeking customers
for fuel delivery or equipment installation,
a good salesperson can be an invaluable
resource for your business. But one ques-
tion we receive quite often from our energy
clients is this: Howmuch should I be paying
my salesperson? The factors that play into a
salesperson’s compensation depend on the
individual company, but there are trends in
the industry that can give you, at the very
least, a starting point.
We polled three separate, similarly
sized fuel companies about their practices
in paying their sales staff. Each compensa-
tion package had similarities, but all had
their own “tweaks” intended to boost the
productivity of the sales staff.
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paid their salespeople a base
salary of $480 per week, or approxi-
mately $25,000 annually, plus a commis-
sion on new accounts. At a certain level
of growth the commission level grew.
This created an incentive-based system
that drove their sales staff to push from
five accounts ($200 commission per new
customer) to eight accounts or higher
($400 commission per new customer).
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pays their sales associates
a base salary of $650 to $700 per
week, or approximately $35,000
annually. For fuel sales, they take the
net sales, subtract the cost of product,
and multiply by 5% to calculate the
salesperson’s commission. This formula
allows them to pay each salesperson
on a performance basis – a fair and
easy-to-calculate amount. As an added
benefit, each salesperson receives a
company car or car allowance.
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pays their fuel sales staff
approximately $37,000 annually, with
a commission of $175 for each signed
contract. They have separate sales-
people for equipment, with a $50,000
base salary and a commission paid for
any sales they make beyond a monthly
set goal. This system encourages
salespeople to beat their quota every
month in order to achieve the bonus
commission.
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These three companies each provide
unique systems of compensation, but there
is one common trend: incentives. In order
to keep a sales staff working hard day
after day, there needs to be an incentive
beyond just a base annual salary. Bonus
commissions based on exceeded sales goals
will drive a sales professional to find new
clients every month. The sales staff needs to
recognize that they hold the growth of the
company in their hands.
That growth, however, is not up to the
sales staff alone. In fact, there is not one
member of your entire staff who should
not be considered a “salesperson.” Each
employee has a network of friends, family,
and acquaintances, most of whom have fuel
needs. From the office staff to those deliv-
ering fuel and installing equipment, your
entire team needs to be able to recognize a
lead when they have one and pass it along
to a trained salesperson for a follow-up.
That said, there must be incentives
for non-salespeople to make referrals.
If a member of the delivery staff obtains a
lead, passes it on to the salesperson, and
the salesperson delivers on a contract, the
delivery staff member should be rewarded
in some way. He or she took the initiative
and delivered something valuable to the
company and should be compensated.
The reward does not have to be monetary,
but can come in the form of gift cards and
other recognition that will encourage non-
salespeople to continue to find leads and
make referrals.
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Sales leads are vital, as is success in
pursuing them. But one-time sales are only
good – you guessed it – one time. You must
develop a companywide set of standards
that describe the type of customer you want,
stressing customer retention to your entire
staff as an important aspect of customer
acquisition.
A customer that has positive interactions
with your staff, starting with a salesperson
and continuing with the office staff and
delivery team, will be more likely to come
back the next time they need oil, propane,
or service. Happy customers also refer their
friends and neighbors, essentially becoming
a “salesperson” for your company!
In order to ensure this positive cus-
tomer experience, your entire staff must
be fully versed in your company’s services
and products. That way, if the client has
a question, they can go to any member of
your staff for an answer. Always remember,
the best answer to a question that your staff
member does not know the answer to is,
“I’m not sure, but I know exactly whom to
ask to find out.”
A knowledgeable, courteous, attentive
staff member can be a salesperson for your
company. Salespeople sell products and
services. Non-salespeople sell your com-
pany. It is up to you to provide the proper
incentives for both in order to cultivate a
culture of lead generation and growth.
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By Martin Kirshner, CPA, Gray, Gray & Gray, LLP
