Coming off a year when the ability of account executives to peddle MFPs and other varieties of hardware became severely cramped by supply chain issues, one might gather that dealers across the United States would tamp down expectations and perhaps revisit the quotas they’ve established for their star reps. Well, one would be wrong.
OK, yes, so it is tougher to write business when the ETA for hardware arrival is a bit sketchy. However, many of the highest-performing dealers offer too great a variety of heavy equipment, managed services, software and solutions for management to be hedging their sales department’s expectations. Thus, as we open November’s State of the Industry report on post-pandemic sales, our dealer panel provides insight into how its definition of success has changed, if at all, and whether circumstances have caused them to curb expectations.
Adding net-new clients is the best way for account reps at Kelly Office Solutions to maximize their comp plans; without one, they max out at 40% of gross profit for their commission. With net-new, reps are also paid on the segment. Tim Renegar, president of the Winston-Salem, North Carolina-based dealer, points out that a good comp plan will help drive the desired behavior of the rep.
“The comp plan will make you successful or drive you out of business,” he said. “That’s how we do it, we let the comp plan do the talking. The good [reps] understand it, they’re going to make their number and be well-rewarded. The bad ones will leave the business on their own.”
Tough Love
Tim King, vice president of sales of Gainesville, Virginia-based Offix, is unapologetic on the subject of comp plans and quotas. Client outreach opportunities are a mixed bag in the regions it serves, with some providing a higher degree of difficulty than others. But the dealer incents handsomely, particularly when it comes to net-new clients/placements.
“I’m not going to come off sounding like a really nice guy, but reps know the quotas are the quotas and the expectations are the expectations,” King said. “While selling is more difficult, it just means that your activity level has to be higher than what it was before.”
While quotas have remained largely unchanged throughout the pandemic period for Stratix Systems of Wyomissing, Pennsylvania, the stakes have been raised for reps in terms of burrowing for managed services and net-new business opportunities, according to President Brent Simone.
“There’s been talk in the industry about dealers changing the way they do quotas or taking a different approach because of A4 growth,” he said. “We haven’t done that. We’ve found that focusing on managed services and net-new opportunities is the path we need to take.”
If anything, considering the price increases for a lot of equipment, the proper tack would be to raise quotas, notes Jim Morrissey, president of UBEO Business Services in Austin, Texas. He fought to raise quotas during 2022 in light of multiple price increases over the past two years.
“Everyone took a dip in sales from 2019 to 2020, but 2021 was a little better and now this year we’re above 2019 levels,” he said. “With fatter prices, why would we need to lower the quotas? But we kept them the same, and a lot of our reps are going on the president’s club trip this year.”
Full Catalog
Quotas have remained static throughout the pandemic era for CPI Technologies of Springfield, Missouri. Erik Crane, president and CEO, the sales team is charged with achieving the appropriate levels of revenue-producing activities, which will lead to sales regardless of whether the sales cycle is longer or more difficult to forecast.
“We have tasked our legacy reps with the responsibility of marketing our entire product offering, including VoIP phones, managed IT, mailing equipment, interactive whiteboards and, of course, MFPs and printers,” he noted. “Success is earning sales in all these categories and working together to provide the best technology to the client.”
Entry-level account representatives have a somewhat lower quota at the onset of their engagement with Pulse Technology of Schaumburg, Illinois. CEO Chip Miceli notes that once they become acclimated following a lengthy training and mentoring period, the quotas increase (the dealer has three levels of account executives, with graduated quota levels).
“We fully understand the evolution of a salesperson takes time and it is our job to support their progression in this journey,” he said. “As far as success, this may sound like a simple answer, but we define it as consistency and progress in achieving your personal and professional goals.”
Account representatives with Electronic Office Systems of Fairfield, New Jersey, are among the highest incented of any dealer within the region. Reps can enjoy even greater bonuses by landing four net-new accounts per month, according to President Andrew Ritschel.
“Whenever we interview reps who are coming in from a competitor, we calculate how much they would be making at EOS, and it’s significantly greater than anyone in our marketplace,” he said. “We’re essentially paying to be in business as opposed to making a little money. After paying the reps and the cost of sales, I’m lucky if I’m making one point. A lot of times I’m not making anything; it’s purely to get the service and supply business.”
