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9x12 Sales Rep - Anyone working with one?

by FormerWageSlave
19 replies
Just wrapped up my second 9x12 card and it went very well. I am looking to expand out to 6 additional business districts in my area, but to do that, with my schedule, I feel I need a sales rep to meet with businesses and fill spots.

Do any of you 9x12ers have a sales rep arrangement you'd be willing to share with me?

How do you pay? What's your split? Are they an employee or independent contractor?

What else should I be considering?

Thanks for your help.
#9x12 #hire #rep #sales #working
  • Profile picture of the author jamesfreddyc
    Originally Posted by FormerWageSlave View Post

    Just wrapped up my second 9x12 card and it went very well. I am looking to expand out to 6 additional business districts in my area, but to do that, with my schedule, I feel I need a sales rep to meet with businesses and fill spots.

    Do any of you 9x12ers have a sales rep arrangement you'd be willing to share with me?

    How do you pay? What's your split? Are they an employee or independent contractor?

    What else should I be considering?

    Thanks for your help.
    I don't know about any 9x12 such thing or what kind of split you should determine, but I'd say figure out your gross margin number(s) for whatever it is you market/sell and base commissions off of that.
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  • Profile picture of the author iAmNameLess
    Bob Ross had some of his people available for appointment setting. Not sure if they're still available but since they have experience doing this that might be the best bet.
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  • Profile picture of the author rugman
    Bob Ross just had a podcast on this a little bit ago - not sure if it is open or for members. Look him up if he doesn't jump in here.
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    Growing older but not up!

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  • Profile picture of the author FormerWageSlave
    Thanks all for your input.

    I need more than appointment setting. Looking for someone local to visit businesses and sell. Although I have been successful, I can barely call myself a salesman. And I would rather spend that time on my consulting clients and my family.

    I'm thinking I will put an ad up on Craigslist, but want to at least appear competent when presenting the arrangement.

    How does this sound?

    No base, all commission, we split 50/50 the profits generated from each card which for me has been $5k-$6k. Independent contractor. Part time or full time, I don't care, just fill cards and move on to the next business district.

    They fill spots, I handle everything else. I sold my first 9x12 in my spare time in 15 hours over two weeks time. An experienced salesperson could do just as well I hope.

    Is that compensation fair, good, bad? Is the whole arrangement unattractive? Am I thinking about this wrong?

    Thanks all, for helping out this sales noob.
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    grrr...

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    • Profile picture of the author misterme
      Originally Posted by FormerWageSlave View Post

      Is that compensation fair, good, bad? Is the whole arrangement unattractive? Am I thinking about this wrong?

      Thanks all, for helping out this sales noob.
      I think you're being too generous.
      Make sure your contracts state "verbal agreements not valid."
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    • Profile picture of the author iAmNameLess
      Originally Posted by FormerWageSlave View Post

      Thanks all for your input.

      I need more than appointment setting. Looking for someone local to visit businesses and sell. Although I have been successful, I can barely call myself a salesman. And I would rather spend that time on my consulting clients and my family.

      I'm thinking I will put an ad up on Craigslist, but want to at least appear competent when presenting the arrangement.

      How does this sound?

      No base, all commission, we split 50/50 the profits generated from each card which for me has been $5k-$6k. Independent contractor. Part time or full time, I don't care, just fill cards and move on to the next business district.

      They fill spots, I handle everything else. I sold my first 9x12 in my spare time in 15 hours over two weeks time. An experienced salesperson could do just as well I hope.

      Is that compensation fair, good, bad? Is the whole arrangement unattractive? Am I thinking about this wrong?

      Thanks all, for helping out this sales noob.
      I think that the arrangement is definitely fair for the would be sales person. However, I don't think it is a wise move on your part for a couple reasons.

      1.) It seems sketchy. You never want to give X percentage of profit. It could also end with legal problems.
      2.) You will have a hard time getting people to trust you that whatever you say is the profit. This ends up in low quality applicants who probably can't sell jack.
      3.) They won't understand additional costs, postage, printing, etc.
      4.) For profit distribution you would be considered a legal partnership. You don't want that, you want to be able to write off the commission as an expense, not a distribution.

      The amount you would be giving them is fair... but you should maybe give that amount in a different format.

      Since you already know what your profit is, I'd recommend breaking it down and give whatever % of the sale as commission to where it would be 50% profit but we're not saying profit, it is commission.

      Also, not sure if you're doing this but if you're not you're leaving a lot of money on the table and making your job harder. Don't just sell 1 time spots. Make the mailer a monthly thing, and sell discounted rates for 3 month agreements, 6 month, and 12 month. If you end up with 50% of your advertisers renewing for longer term advertising, then you don't only need to find 12-15 spots each time you do this... you only need to find 6-7.
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      • Profile picture of the author FormerWageSlave
        Very helpful. Thank you iamnameless.

        Perhaps I should rethink the profit sharing. Here was my thinking on that though.

        The price of each spot is decided and known by all parties and the salesperson will need to collect a deposit from the business to reserve the spot. We all know what the spot sold for.

        There is also some latitude on the pricing. When I am close to doing a sale, and I think knocking $50 off will close it, I do it. I would give that same freedom to the sales rep.

        My expenses are also fixed. Printing, design, postage are fixed costs and everything over that is profit. I was going to be transparent about that, and set the expectation for what they could earn based on the fact that each card is worth between $8k-$9k. Minus costs, and we split the rest 50/50. Sounds like that may not go over well though?

        I hear you about the profit sharing become a legitimate partnership and I would prefer not to have that.

        How would you structure the commission to encourage them to get the highest price possible for all the spots?

        Thanks again for your input. Much appreciated.



        Originally Posted by iAmNameLess View Post

        I think that the arrangement is definitely fair for the would be sales person. However, I don't think it is a wise move on your part for a couple reasons.

        1.) It seems sketchy. You never want to give X percentage of profit. It could also end with legal problems.
        2.) You will have a hard time getting people to trust you that whatever you say is the profit. This ends up in low quality applicants who probably can't sell jack.
        3.) They won't understand additional costs, postage, printing, etc.
        4.) For profit distribution you would be considered a legal partnership. You don't want that, you want to be able to write off the commission as an expense, not a distribution.

        The amount you would be giving them is fair... but you should maybe give that amount in a different format.

        Since you already know what your profit is, I'd recommend breaking it down and give whatever % of the sale as commission to where it would be 50% profit but we're not saying profit, it is commission.

        Also, not sure if you're doing this but if you're not you're leaving a lot of money on the table and making your job harder. Don't just sell 1 time spots. Make the mailer a monthly thing, and sell discounted rates for 3 month agreements, 6 month, and 12 month. If you end up with 50% of your advertisers renewing for longer term advertising, then you don't only need to find 12-15 spots each time you do this... you only need to find 6-7.
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        grrr...

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    • Profile picture of the author Ron Lafuddy
      I've created and sold my share of ad programs. The idea of hiring a salesman goes against my grain. That's a whole 'nother discussion. So, I did something else. I found a partner.

      In one case, it was a printer. I had established 3 ad programs in his area. They were up and running, producing good income. That got his attention.

      He had everything needed to keep them going. He had an inside graphics person, an experienced sales guy and a print shop. He also had the ability to cut the costs and increase his share of the profits.

      The guy was honest. He kept good records and he could keep a schedule. The arrangement worked out well for everyone.

      If hiring a salesman doesn't work out, perhaps a partnership might.
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      • Profile picture of the author Publisher
        Ron,
        Would you please share on how you structured your partnership?

        Thanks
        Shawn
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      • Profile picture of the author FormerWageSlave
        Thanks Ron. At this time, I have all the other components to this locked in and really requires not a lot of effort on my part. My designer handles the client, and once done, everything gets sent to the printer, then gets shipped to me.

        The sales part is a little over my head and the most time consuming. I am happy to split profits if I can expand out to 6+ more zones and just collect checks.

        What did your printing partner need you for? Sounds like he had all the components to the type of program all in his own shop. Am I misunderstanding?

        Thanks.

        Originally Posted by Ron Lafuddy View Post

        I've created and sold my share of ad programs. The idea of hiring a salesman goes against my grain. That's a whole 'nother discussion. So, I did something else. I found a partner.

        In one case, it was a printer. I had established 3 ad programs in his area. They were up and running, producing good income. That got his attention.

        He had everything needed to keep them going. He had an inside graphics person, an experienced sales guy and a print shop. He also had the ability to cut the costs and increase his share of the profits.

        The guy was honest. He kept good records and he could keep a schedule. The arrangement worked out well for everyone.

        If hiring a salesman doesn't work out, perhaps a partnership might.
        Signature

        grrr...

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        • Profile picture of the author Ron Lafuddy
          Originally Posted by FormerWageSlave View Post

          What did your printing partner need you for? Sounds like he had all the components to the type of program all in his own shop. Am I misunderstanding?

          Thanks.

          No, he didn't have all the components to the programs, just the ones I'd chosen for him to take on.

          The key, is that the printer already had the pieces in place, to take on the parts that I didn't want to be bothered with. There was no additional risk or investment for him to make.

          It was profitable for him from day one and by controlling cost, he was in a position to make it more-so. He had every incentive to want this to work out well for both of us.

          Partnering added stability, unlike hiring a salesperson, which adds cost and risk.

          Anyway, it sounds like you have everything well in hand.
          Well done and best of luck.

          Ron
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          • Profile picture of the author iAmNameLess
            Originally Posted by dave147 View Post

            I think you're a bit over generous with the 50/50 split. I'd do a $100 commission per spot filled, and they would be an "independent contractor" responsible for their own actions.
            You won't find anyone worth your time here in the US for $100 per spot. You would have to do 200-250 probably. At least that's how it is here, different areas I suppose will have different levels of motivation or desperation.

            Originally Posted by FormerWageSlave View Post

            Very helpful. Thank you iamnameless.

            Perhaps I should rethink the profit sharing. Here was my thinking on that though.

            The price of each spot is decided and known by all parties and the salesperson will need to collect a deposit from the business to reserve the spot. We all know what the spot sold for.

            There is also some latitude on the pricing. When I am close to doing a sale, and I think knocking $50 off will close it, I do it. I would give that same freedom to the sales rep.

            My expenses are also fixed. Printing, design, postage are fixed costs and everything over that is profit. I was going to be transparent about that, and set the expectation for what they could earn based on the fact that each card is worth between $8k-$9k. Minus costs, and we split the rest 50/50. Sounds like that may not go over well though?

            I hear you about the profit sharing become a legitimate partnership and I would prefer not to have that.

            How would you structure the commission to encourage them to get the highest price possible for all the spots?

            Thanks again for your input. Much appreciated.
            I don't know the ad sizes or your pricing structure so I can't really help you with the pricing or how to change your pay out structure.

            What I would do, is figure out the price per ad cost that you NEED in order to break even. Now add whatever you need to the price for you to make whatever amount of profit you want. So if your break even point is $175 per spot... and you sell 14 spots, you can add an extra $100 to make $1,400 profit on each card the sales person is able to sell out. You would then tell the sales person, the lowest sale you can accept is $275. Anything above that, he gets to keep.

            For sales materials, I would create a pricing sheet that showed $800/ad for 1 month, also showing different discounts for long term monthly agreements. For example..

            1X - $800
            3X - $700
            6X - $600
            12X - $500

            This increases the probability of longer term commitments and makes future cards easier to do.

            If the salesman decides to approach it saying we're doing a discounted entry into your program, the usual price is $800 but we can get you in for $600 right now, it can be pretty powerful.

            It makes it easier for you, as long as you don't get jealous of the salesperson making more than you per card. However, the benefit you have is scaling.

            Most sales people do not last long. They're flakey, they have problems, and can be very frustrating. BUT, if they quit, and they had multi-month sign ups, thats all your money. Make sure you have an agreement in place though.
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            • Profile picture of the author dave147
              Originally Posted by iAmNameLess View Post

              You won't find anyone worth your time here in the US for $100 per spot. You would have to do 200-250 probably. At least that's how it is here, different areas I suppose will have different levels of motivation or desperation.
              Well it is $1800 a card for them for a few hours work a day, and could be filled in a few days if they're any good.
              but yeah, different levels of motivation or desperation I guess, a combination of the two would be good.

              Great idea on the pricing sheet there.
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  • Profile picture of the author dave147
    I think you're a bit over generous with the 50/50 split. I'd do a $100 commission per spot filled, and they would be an "independent contractor" responsible for their own actions.
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  • Profile picture of the author SashaLee
    Hi there,

    Forget about analysing the split because you're only going to get dead turkeys with this opener:

    "No base, all commission"

    All the best,

    Sasha.
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    • Profile picture of the author FormerWageSlave
      You may very well be right. But it doesn't seem like I'm in the position right now to make this anything bigger than commission based sales. Although I could put up $ in good faith at the start against future commissions? That's a thing isn't it?

      I guess we'll see.

      And I wouldn't open with that in my ad, by the way.

      Originally Posted by SashaLee View Post

      Hi there,

      Forget about analysing the split because you're only going to get dead turkeys with this opener:

      "No base, all commission"

      All the best,

      Sasha.
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      grrr...

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  • Profile picture of the author FormerWageSlave
    Great advice iamnameless. Thank you.

    One of my selling points for the card is no contracts, no commitments. This is because a lot of publishers out there are pushing advertisers into longer commitments.

    So far it's looking like I will have a 75% retention rate for my very first 9x12, with the sequel card. In part due to many of the businesses actually doing well with it, but even those that didn't, I am promising that we will be targeting new areas on the next card and they should give that a chance.

    But I could definitely rethink the no contract, no commitment part. It would be better for me of course. I wonder how the prospect values it? It is a common question I get during a sales pitch, usually with a sour look on their face. So I think they expect some long commitment like other ad mediums.

    Just for edification, I do a small, medium, large for $445, $595, and $795 respectively. 20,000 pieces in total across three promotional segments. And the promotion lasts for three months, not just a one time mailing.

    I've known my (breakeven, P&L, etc.) numbers since before I even started selling. But I like the structure you've presented. That's the ticket I think.

    Anyway, your input is very helpful. Thanks again.

    Incidentally, I did "sign up" my brother in law in another state to sell these where he lives. He's a recent MBA grad, looking to start a business or get hired, and until then is going to give this a go. It will be a good test to see how a sales rep arrangement could work.
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  • Profile picture of the author SashaLee
    Hi there,

    You could also copy a page out of Jay Abraham's books and tell the salesman this:

    1. You get the entire 1st month card fee for yourself as your commission. You sell it for $600 you make $600.
    2. Each subsequent month they sign up you get $250.

    Now, YOU take a loss on the first card, BUT the rep will be stoked to work their ass off for the money. There's less effort required for subseqent month signups and over time you make the money. It's all about the lifetime value of the advertiser.

    We use a similar structure with one of our clients and it works tremendously well - it's not in advertising sales though.

    Once you get over the mental block of the first month investment (which is what it really is) you'll be on the road to riches so long as you're tackling the right market.

    All the best,

    Sasha.
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    • Profile picture of the author misterme
      Originally Posted by SashaLee View Post

      1. You get the entire 1st month card fee for yourself as your commission. You sell it for $600 you make $600.
      2. Each subsequent month they sign up you get $250.
      That sounds great though it works best in certain circumstances, namely, where product capacity is unlimited. The idea being that the sales producers are going to go great guns with that incentive and sell more than they would normally otherwise, so on a card with a limited number of spots to sell, there aren't more sales which can be made, and so, a lot of the profit will go out as commissions.
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