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Have you ever used an independent sales rep to sell your translation services?
Thread poster: Alex Hughes

Alex Hughes  Identity Verified
United States
Local time: 06:23
Spanish to English
+ ...
Jul 22, 2013

Hello everyone,

I am wondering if anyone has experience/advice on working with independent sales reps. What did you find were the best hiring practices and methods? How did you calculate commissions? What would you avoid?

I'm researching the idea of turning my personal company into a small consulting firm (providing translation, content creation, transcription and other consulting services). I realize that eventually time and geographic limitations will make it difficult for me to personally handle sales. Thus, once the company reaches a reasonable size I would like to work with a few part-time commission only sales reps throughout the US. But, finding information related to translation sales has proved challenging.

I appreciate any information that you can provide, and thank you in advance!


 

LilianNekipelov  Identity Verified
United States
Local time: 07:23
Russian to English
+ ...
I have never done it -- but it looks like a great idea Jul 22, 2013

provided that they work on commission only. I think probably 10-20% might be a reasonable commission rate if they get you a good rate and interesting translations. I am not sure though, if anyone will be really able to do it. It usually takes your own effort to get clients.

 

Alex Hughes  Identity Verified
United States
Local time: 06:23
Spanish to English
+ ...
TOPIC STARTER
Difficult to resource Jul 22, 2013

Hi Lilian,

Thanks for your reply! It does seem like it will be difficult at first to resource and train salesman.

I was thinking 10-20% as well and that the percentage would vary depending on the rate per word they achieve or contract type. But, translation is an ongoing service, so how long do they receive that commission for? I was thinking for one year or up to a certain dollar amount whichever comes first.


 

Łukasz Gos-Furmankiewicz  Identity Verified
Poland
Local time: 13:23
English to Polish
+ ...
I agree with Lilian, but there's more Jul 22, 2013

I wouldn't be able to pay a sales rep much initially for the invested time alone, but I'd definitely be willing to collaborate on a commission basis, perhaps including some kind of incentive mechanism or an extra for extra initiative or effort. I might pay him per-hour for initial consultations because I'd want to him to listen very attentively to my needs and take due note of them, which is not something people are happy to do off the clock. It would be crucial for him to understand what I can do, what I can't, what I won't and what I will but would prefer not to if possible. We'd need to go through my general terms and conditions, too, and discuss wiggle room for deviations. It would also be extremely important for the sales rep to understand and respect my branding and overall style, even if following it would result in worse sales for me than otherwise and thus smaller commission for him.

Unfortunately, I would need him to contract with the client independently for his own payment (or we could draw up some kind of tripartite agreement), since I likely wouldn't be able to afford his commission without first being paid by the client, at least initially. I'd hope this situation could change at a later time depending on our results and their impact on my liquidity.

At any rate, I'd insist on an individual approach and no fitting into an existing plan (unless the plan were really good from my subjective point of view).

[Edited at 2013-07-22 18:19 GMT]


 

Alex Hughes  Identity Verified
United States
Local time: 06:23
Spanish to English
+ ...
TOPIC STARTER
Good point on payment Jul 22, 2013

Łukasz Gos-Furmankiewicz wrote:

I wouldn't be able to pay a sales rep much initially for the invested time alone, but I'd definitely be willing to collaborate on a commission basis, perhaps including some kind of incentive mechanism or an extra for extra initiative or effort. I might pay him per-hour for initial consultations because I'd want to him to listen very attentively to my needs and take due note of them, which is not something people are happy to do off the clock. It would be crucial for him to understand what I can do, what I can't, what I won't and what I will but would prefer not to if possible. We'd need to go through my general terms and conditions, too, and discuss wiggle room for deviations. It would also be extremely important for the sales rep to understand and respect my branding and overall style, even if following it would result in worse sales for me than otherwise and thus smaller commission for him.

Unfortunately, I would need him to contract with the client independently for his own payment (or we could draw up some kind of tripartite agreement), since I likely wouldn't be able to afford his commission without first being paid by the client, at least initially. I'd hope this situation could change at a later time depending on our results and their impact on my liquidity.

At any rate, I'd insist on an individual approach and no fitting into an existing plan (unless the plan were really good from my subjective point of view).

[Edited at 2013-07-22 18:19 GMT]


My thought was that every time a sale is made the consultant would receive let's say 15% for the first $10,000 (increased for large clients or higher rates) of services provided to that client. So, for every $1000 of services provided to the client the consultant would receive a $150 payment until $10,000 is reached. In this way, I am not at risk of paying commissions without having actually received work and the consultant would be receiving regular payments. In addition, I could pay say 5% at year end for total sales if the consultant meets a client quota.

I hope that using a system like this will motivate the staff to go after larger clients or higher rates, and allow my company to stay current on all staff and freelancer payments.

But, I can't find any information to validate my idea! This input has been very helpful so far though.

[edit] Also, this would not be selling my services as an individual, I would provide any services in-house that I could and all other services would be provided by freelancers (more of a cooperative than an agency). Ideally once I had established a reasonable number of clients to sustain the company, I would look into developing the company through independent sales consultants.

[Edited at 2013-07-22 19:05 GMT]


 

Kuochoe Nikoi  Identity Verified
Ghana
Local time: 12:23
Member (2011)
Japanese to English
How long would it last? Jul 22, 2013

A really good sales rep would probably start their own translation agency in no time at all. Why take a 10% cut when you can get 50%?

 

Alex Hughes  Identity Verified
United States
Local time: 06:23
Spanish to English
+ ...
TOPIC STARTER
That's the problem Jul 22, 2013

TransAfrique wrote:

A really good sales rep would probably start their own translation agency in no time at all. Why take a 10% cut when you can get 50%?


Unfortunately, paying 50% would kill most of the profit. This consultant would have to do it for on the side cash and not as a main source of income. I think this job is going to require a very specific situation and skill set.

I have thought about hiring the best salesman as a staff member after some time has gone by, but this would be pretty far down the road.


 

LilianNekipelov  Identity Verified
United States
Local time: 07:23
Russian to English
+ ...
You can hire a buyer, or a sales rep rather in this case, on a full-time or part-time basis Jul 22, 2013

The problem is that sometimes they just walk around if they are paid a regular salary and enjoy the weather, and they cannot be really paid on the commission basis only. Nobody would do it just on commission because they would most likely have to walk hungry for at least half of the month.

[Edited at 2013-07-22 19:32 GMT]


 

John Fossey  Identity Verified
Canada
Local time: 07:23
Member (2008)
French to English
Not necessarily Jul 22, 2013

TransAfrique wrote:

A really good sales rep would probably start their own translation agency in no time at all. Why take a 10% cut when you can get 50%?


Most sales reps want to be sales reps, not business owners. They are two completely different activities and spheres of responsibility.

LilianBNekipelo wrote:

The problem is that sometimes they just walk around if they are paid a regular salary and enjoy the weather, and they cannot be really paid on the commission basis only. Nobody would do it just on commission because they would most likely have to walk hungry for at least half of the month.


You agree on KPIs (Key Performance Indicators) that have to be met and consequences if they are not met. Besides, many sales reps take on a number of different but complementary lines - products they represent that do not compete with each other but are all purchased by the same set of clients. So they are not dependent on a single company.

[Edited at 2013-07-22 20:13 GMT]


 

Alex Hughes  Identity Verified
United States
Local time: 06:23
Spanish to English
+ ...
TOPIC STARTER
Exactly Jul 22, 2013

John Fossey wrote:

You agree on KPIs (Key Performance Indicators) that have to be met and consequences if they are not met. Besides, many sales reps take on a number of different but complementary lines - products they represent that do not compete with each other but are all purchased by the same set of clients. So they are not dependent on a single company.

[Edited at 2013-07-22 20:13 GMT]


John, you hit the nail on the head, that's exactly what I am looking for. Any suggestions on finding people like this and working with them?


 

jyuan_us  Identity Verified
United States
Local time: 07:23
Member (2005)
English to Chinese
+ ...
It's not a feasible idea to pay a salesperson as a small business owner Jul 22, 2013

You need to train the candidate but it's very likely that by the time he has mastered the skills and can really secure a contract, you might lose him. The reason is, if has a contract, he can easily outsource the jobs and make at least a 50% profit. That's more than double your 15-20% commission.

The thought about working with an independent salesperson would lead to nowhere.

Another thought is that you could hire a full time sales assistant, and promote him or her to the sales position when ready. It can be a better option but I cannot state clearly why is so. I just sensed it.

[Edited at 2013-07-22 23:33 GMT]


 

Alex Hughes  Identity Verified
United States
Local time: 06:23
Spanish to English
+ ...
TOPIC STARTER
Why would they outsource? Jul 22, 2013

jyuan_us wrote:

You need to train the candidate but it's very likely that by the time he has mastered the skills and can really secure a contract, you might lose him. The reason is, if has a contract, he can easily outsource the jobs and make at least a 50% profit. That's more than double your 15-20% commission.

The thought about working with an independent salesperson would lead to nowhere.

Another thought is that you could hire a full time sales assistant, and promote him or her to the sales position when ready. It can be a better option but I cannot state clearly why is so. I just sensed it.

[Edited at 2013-07-22 23:33 GMT]


I'm not sure why a salesperson would automatically become competition. Look at it this way to run a translation company you need to: incorporate, contract resources, create a project management and QA system, create a corporate image, advertise, buy insurance, hire an accountant, coordinate translators and proofreaders, certify translations and then deal with the client if there is an issue.

But, if you are a sales rep you: prospect, market, make sales calls, sign the contract and check up on the client 3-4 times max, this is still a lot of work. However, if you are good and in 20-30 hours you can contract one client that turns into a $3000-4000 commission, plus year end bonuses, then I'd say you are doing well.

Like John mentioned, most commission only guys sell various products. So, if someone is already selling web design and software it would be easy for them to sell translation, content creation and transcription to their existing clients (they don't need to be an expert in translation, just an expert in selling my company's services), and between all of the items they sell there's the possibility of a very high income with almost zero risk to them.


 

John Fossey  Identity Verified
Canada
Local time: 07:23
Member (2008)
French to English
Contract Jul 23, 2013

jyuan_us wrote:

You need to train the candidate but it's very likely that by the time he has mastered the skills and can really secure a contract, you might lose him. The reason is, if has a contract, he can easily outsource the jobs and make at least a 50% profit. That's more than double your 15-20% commission.


Nobody is going to hire a rep without a non-compete clause in the contract, that's standard practice. They can't compete during the life of the contract and for an agreed number of years (typically 2 to 5) after termination. The non-compete clause for a rep is much typically much more comprehensive than for a freelance translator - frequently denying the rep the ability to represent the same product or service in the same geographical area (or at all) as their principal for an agreed period. And reps accept those terms because they have no intention of going into managing the jobs, they just want to sell them.

[Edited at 2013-07-23 00:38 GMT]


 

Marie-Helene Dubois  Identity Verified
Spain
Local time: 13:23
Spanish to English
+ ...
salespeople vs. lead generators Jul 23, 2013

I personally wouldn't advise setting a limit on the business that commission is paid on.

I would say that the salesperson's client is the salesperson's client and commission should be earned on all of that client's business while the salesperson continues to work with you.

I don't see the logic behind setting a cap on commission. Surely you'd want the salesperson to cultivate long-term business relationships and encourage existing clients to continue doing business with you?
Often, satisfied clients are the best ambassadors for your business and you need the salesperson to be encouraged to keep in touch with clients and ask for new business and recommendations.
Having worked as a salesperson for many years, often on commission only, I know that a commission-only salesperson is driven by commission only, and that how this commission is structured can affect a salesperson's behaviour, which consequently affects sales. It's up to the person structuring the commission to endeavour to affect sales positively.

In my experience, setting a cap on the amount of business that a salesperson can earn commission on is a very good way of encouraging the salesperson to forget about the client once this cap has been reached and you could in this way lose some vital opportunities for referrals.

It's also easier to upsell to an existing client than to obtain new clients and whether a client is new or existing makes no difference to you whatsoever financially. It's all new business and a translation is a translation.

In fact, I would think that obtaining new business from an existing client is more efficient than obtaining new business from a new client because presumably in the former case, you're already familiar with the terminology and therefore can work faster.
A good salesperson will focus his/her business (why is everyone assuming the salesperson is a 'he' btw?) on where the commission comes from.

Also, be under no illusion that clients will start dealing with you once the sale is done. Clients invariably go to the person they've bought into, i.e. the salesperson, if they have issues or queries, and the salesperson will deal with these issues according to what is in it for him/her. Having the salesperson refer clients to you after a while (once the cap is reached), will probably only serve to put clients' backs up. I certainly don't appreciate being shifted from one person to another/one department to another when I have an issue with a company.

There is a difference between lead generation and sales. Sales is an ongoing process. Once the client is on board, the client needs to be nurtured and the salesperson should therefore be remunerated accordingly.


 

Theo Bernards (X)  Identity Verified
France
Local time: 13:23
English to Dutch
+ ...
I am toying with this idea myself... Jul 23, 2013

... and in times long gone I was a telesales rep. In sales, there are farmers and hunters, so to speak, soft sellers who work on building a relationship with a client and reap the benefits after that the relationship is established versus the killer that is only oriented on short term gain. The first question you need to ask yourself: which kind of sales person do I want?

I know of translators with a partner doing the selling (and the invoice collection, because the character traits for that particular profession bear remarkable resemblance to sales people character traits - I should know because I have done both in the past) and they earn rather high money - but at what cost? Two jobs on one pillow never seems a good idea (although it makes for great TV comedyicon_smile.gif , if memory serves me well).

Here's a suggestion: try your ideas out on a small scale via a generic freelancers website by setting out a project like 'Sales person wanted', offer a small budget and indicate that it is a 'no cure no pay' commission-based job, set out a comprehensive brief/project description and see what happens. And please let us know how you have fared doing that, because I would be interested and I am sure many more in this discussion.


 
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