Building a Sales Team
When is the Right Time to Start?
When starting a business one of the things that business owners may or may not realize is that they will have to wear all the hats. What I mean by hats is that he or she will have to take on the roles of everyone (sales, HR, fulfillment, operations, customer support, etc.) in order to keep the business running. Once you start to grow and see some revenue coming in, hopefully, you’ll be at a point where you can start to delegate and hire more people onto your team to scale. One of the BIG mistakes or lessons I learned when I owned my fitness company was not hiring a sales team. This led to a vast constraint in my business and limited my ability to scale and grow, ultimately limiting my ability to make a bigger impact on the health and wellness of many more people.
I did have a team. However, it only consisted of an assistant and trainers to train the boot camp sessions. All of the “strategy sessions” aka sales meetings weighed on me and therefore stopped with me. If I could go back and talk with my younger self, I would share the next steps in scaling my business and how to hire and train a sales team.
I acquired the basic fundamentals and framework for this knowledge from Cole Gordon. I had the opportunity to be a part of this process when I worked for a company in the high-ticket sales arena, and this is how they grew their sales team. It works when you use it and makes a lot of sense when you implement it in your business.
How and When to Make Hiring Decisions in your Business
Hiring team members is solely to alleviate active (or perceived future) business constraints. Hiring without consideration for active or future constraints will result in a bloated team.
It’s important to identify first what your constraints are. The two most common might be fulfillment and operations. If it’s fulfillment (Meaning you can’t fulfill to your customer what you promised because you’re on too many sales calls, then one option would be to innovate.
- Move 1 on 1 calls to group
- Do fewer calls
- Leverage with technology
- Essentially change the structure of your business to accommodate the demand
- Hire a coach or someone to fulfill the services you’re selling so you can focus on taking the current number of sales calls.
- Automate or eliminate tasks
- Delegate to a new operations person
If the main constraint is availability, meaning there are no more spots on the calendar for you to take sales calls because your marketing is generating more leads than you can take then it’s time to hire a closer.
The above might all seem common sense, but many business owners make the fatal mistake of hiring just to hire. They don't have any constraints to ease, so they cause unnecessary problems.
Another important tip is to delegate low-level tasks first and highest-leverage tasks last. A high-leverage task such as sales should be completed last, as it has the highest return on investment.
Even though I was unaware of this or didn't have a framework to work from, I was actually doing some of this in my business. In order to focus on sales and adding more members, I first hired an assistant to handle all scheduling, emails, and billing; essentially low-level tasks that consumed my time. In addition, since I was only one trainer, hiring more trainers made sense if we wanted to train more people. Because I still loved being in the trenches and training a small portion of sessions, I used a system to onboard and phase myself out of training. Eventually, I stopped training altogether and concentrated on sales and growing our members. Additionally, I had someone handle social media for us.
In my case, I failed to delegate the highest leverage task, which was "sales". In my mind, adding a salesperson would lead to a way lower closing ratio, and we would lose a lot of members. I also wondered how I would be able to pay them enough to stay and support my wife and two young kids while maintaining my current lifestyle. My failure to hire and train salespeople only hurt me and the company's growth. With an abundance mindset, I could have increased marketing to accommodate the additional salesperson and then honed their sales skills so we could close more deals and serve more customers. In other words, I could duplicate myself and then take the time to consider the bigger picture and expand to more locations if I repeated this enough times.
It is important for entrepreneurs to spend their days doing activities that yield the highest revenue per hour. These activities usually consist of things only you can do or might be challenging to delegate.
- Coaching sales team etc.
- Improving or expanding (adding more products)
Since there is only so much time in a day, you can’t do it all (obviously). You must delegate, automate, motivate, and outsource. Spend most of your time doing high revenue-generating tasks and less low rev-gen tasks. Essentially delegate all other business tasks BEFORE you delegate closing - aka sales.
The Biggest Takeaway:
- Master your sales process before delegating it.
- Short-term benefits include making more money because you’re spending time doing high-leverage tasks.
- Setting your sales team up for success because you’ve validated your sales process. You also have a call library you can reference and use to train your sales team.
How to Know When You’re Ready to Hire Your First Salesperson:
If you can check all the boxes below, then you’re ready
- Is your offer validated? Meaning you have consistently sold it at 25% or higher and sold 30+ units.
- Can you provide 3+ sales calls daily? They can self-generate the rest. However, 3 is the minimum they should be receiving in order to make enough sales and generate enough income to want to stay. The worst thing for a salesperson is to work for a company that makes them hunt for all the business. This is very unattractive, and great salespeople won’t work for you.
- Your offer is priced high enough. Having healthy enough margins to compensate your sales team well. Basically, if you pay your team well and there are opportunities to make even more and grow, you will retain “A-players.” If your comp structure is bad and your sales team can make way more with another company, you will struggle to scale and grow.
If you can confidently check all the boxes above, then you’re ready to hire a sales team. If you make the mistake of hiring prematurely then you will face some obstacles. Here are some that might happen if you make a premature hiring mistake.
- Without a validated offer, your sales reps won’t have the confidence to sell it.
- Little to no lead flow. You will attract bad talent because great closers don’t want to work without a healthy lead flow.
- No healthy compensation means low-level of talent, and/or your people will quit
At the end of the day, it's not your fault you haven’t been able to grow. You don’t know what you don’t know. When a person decides to go into business unfortunately they don’t provide a 4-year degree for entrepreneurs. If you want to be a doctor or lawyer, you go to school, pay tuition and become one. However, taking the path less traveled like “entrepreneurship” means you have to be resourceful and seek out a mentor or coach who already has the success you want and you invest in yourself so you don’t have to make the same mistakes.
Now you have a basic framework for when and when not to grow your sales team. The next step is to take action! Let’s gooooo…