Keeping Them Down On The Farm
How do you keep your best salespeople from leaving to work for somebody else? Or get an independent rep to pay more attention to your line?
The answer, says Jeffrey S. Adler, is "silver handcuffs" -- a deferred bonus plan. Adler, a vice-president of the Insurance Services Division of Mesirow Financial, a Chicago-based financial services firm, explains how it could work:
You set a specific goal this year for your salesperson, who is generating, say, $100,000 in sales annually. You tell him for each year his sales top $110,000, he'll get a bonus of $2,500 -- but the bonus is only payable after he has stayed with the firm seven years. If the salesperson hits his quota each year during that time, the company will pay out a $17,500 bonus in 1997. If the rep leaves before that, the company would keep the money.