You may recall last year we published a series of helpful posts to position your company for the future called the Workplace Series. After a lot of positive feedback, we decided to pick up the series again, this time focusing on the core of every business: people.
Over the next few weeks we’ll be posting about best practices for hiring new employees, developing your staff, and retaining the people you’ve invested in. This week we will focus on who to hire to help you grow your business.
One of the most challenging things about being an entrepreneur is knowing how to grow your business – when to pull the trigger on adding people to your team and how to go about doing that.
There is the risk that comes with adding payroll costs when you don’t know if the individual will pay for themselves, along with the fear of having to let someone go if things don’t work out.
When building out a Distributor business, there are some natural points in time when adding staff makes sense:
- You have more opportunities than you can handle
- You need to free yourself up from administration to build sales
Hiring Support Roles
There are two roles that can help solve administrative burdens and workload problems:
- An Account Coordinator who can help with sourcing, quoting and liaising with existing clients so you can focus on building relationships and bringing in new business
- A Production Coordinator who can manage all general administration needs as well as all supplier touch points after purchase orders are created to make sure production goes smoothly
- Book Keeping/Accounting who can handle all customer invoicing and accounts receivable as well as receiving vendor bills and accounts payable
These roles quickly pay for themselves if you are able to leverage the time for you or your team to be able to sell more. Do some simple math – if one of these roles costs approximately $50K including benefits, vacation etc., then all you need to be able to bring in is an additional $10K/mth in sales. The hiring of any of these roles should easily be able to free up enough time to achieve that.
Building and Scaling a Sales Team
Now that you have a good model going – customers who buy what you’re selling and a brand with purpose – it’s time to scale the sales team.
There are two approaches you can take to this:
- Farmer model– take the Account Coordinator role you hired and when they’ve had a year or two experience, promote them to an Account Manager role where they can manage a portfolio of clients. This allows you to hive off from your portfolio some of the smaller accounts that have room to grow that you don’t have time for. This frees you up to bring in more opportunities and results in solid organic growth from the existing client base.
- Hunter Model – if what you need is more sales fast and you don’t have the patience to grow in a more organic fashion, you can bring in a Hunter who’s responsibility it is to bring in new business. This is a very different skillset from a Farmer, so be sure you are looking for the right thing.
Hiring a Hunter in the promotional industry is difficult – hiring from another Distributor rarely works as they come to you with the baggage of how a different Distributor runs their business. If the other Distributor has done a good job of building their brand, their clients should want to stay with that brand, not follow the individual sales person. If someone promises to bring a book of business to you, you should be skeptical about the success of retaining all of that revenue. It also sets up the potential that they will do the same thing to you one day.
To help you have a better understanding of how these new roles will fit into your business and what they will be responsible for, we’ve developed a Skills Matrix you can save for reference.