Hiring a Salesman

raiken

I have been in the HVAC business for a few years now and have always been word of mouth. We have gotten to 1 mil + a year just from this but want to double or triple this in the next couple of years. In the last 2 years we have tried yellow pages, service magic, flyers, internet yellow pages, and others to no avail. Right now we spent about $ 1500 a month on advertising and it is a total waste of money. I want to put that money into a sales position but do not know how to set up that position as far as pay and commission. Any help on this would be great.

linebacker

We pay 10% of the gross sale. We set the margins that have to be met. They generate half their leads. We furnish the vehicle and gas and expect them to be available at least 8 hours a day. We know where they are at all times. They run the job and collect on completion. We allow a draw against their commission weekly.

Pavel

linebacker, do your salespeople exclusively target the residential retrofit market?

How would you structure it for new construction sales?

How about maintenance contract sales?

linebacker

I tried to reply and the site timed out on me and I lost all I had written. Go to my user CP and leave a message. I'll answer from there.

linebacker

We are involved in mostly the replacement market, residentional and commercial.
What little new construction is high dollar jobs and we pay the sales commisions the same way.
We do a good bit of light commercial new const. and have a person on salary that handles it and other duties.
All our maintenance contracts are sold from within the service department.

Pavel

I'm surprised you're able to pay 10% commission on any new construction, even if it is a high value job. What kind of gross margins do you shoot for?

linebacker

We get a 40% gross after the comm. is taken out. We have been doing this for years and we aren't competive in RNC. We depend on change outs and do very well in that, with 50% margins. If you are trying to do nothing but RNC, my figures will not work. We have been in business since 1964 and I began doing RNC, but got tired of chasing builders. Our sales guys handle the job, ordering equipment, overseeing the job and collecting.

FloridaHVAC

I also pay 10% to my sales guys... Only I provide all of the leads for them... I have them ask for referrals but they are bad at following up... I also have them hang door hangers three left and right of the house they give the estimate at. Each guy has a different number on the door hanger so I can track the leads. I get about one job a month off the door hangers.

DarrenSlaughter

You don't need a salesperson. You are in the enviable position to be in a home services category that is a no brainer for advertising in the YP. You NEED to be in the YP. If you were and it didn't work, it is because the ad was done wrong. Forget sales people, you are in Dallas which is a fairly large market. I could dig up the numbers but I bet 3000 people a month hire an HVAC contractor out of the book. Call Verizon or AT&T or whoever is the Baby Bell in your market (not Yellow Book, you want the phone company for a specific reason) and ask for one of their senior people who knows how to put together a YP ad and watch the right leads come rolling in.

I am sure you will hear otherwise, but I see it happen everyday. Think about it, when its 3am and the heater goes (how's the snow down there by the way?) or even worse, the air goes out, people are not going to go online to find someone, they are going to go to the book, and when they find the biggest ad that has the right copy points that answer their question, they ARE going to call.

Hope that helps.

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A Marketing Blog for Contractors

DarrenSlaughter

Wow, just realized I answered a question from a year ago!

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DarrenSlaughter dot Com
A Marketing Blog for Contractors

linebacker

Darren,
I disagree with your answer, but have a great day!

sjson

I also disagree with you Darren. That might have been true several years back, but the source of leads and marketing has changed. I know this topic is a little outdated by now, but I was curious if you hired a salesman and the results you received from that. I own a HVAC company in Minnesota and started dabbling in SEO on my own. I've been receiving a fair amount of leads from that.

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Minneapolis HVAC | Minneapolis Air Conditioning

refermadness

The more you advertise the more leads you are going to get, word of mouth can make or break you, if you are not getting calls out of yellow pages wrong ad.

FloridaHVAC

In some of the larger markets like mine yellow pages just does not work. There are over 400 HVAC companies listed in our area. By the time you pay to be listed in all of the neighborhoods, the larger ad's, for the placement towards the front of your category, you would have been much better off spending the money in online marketing. In my market that is where most people are searching these days.

Oh what I would do to go back to the days where yellow pages was the only marketing you needed to do!

refermadness

I heard that!!!!!