The careful recruitment of salespeople is very important. This is one of the most significant tasks sales managers perform. When they hire the wrong person, several problems may arise.
Need and Importance of Good Recruitment
Need and importance of good recruitment explained under the following points:
1. Costs are Increasing
The importance of recruiting grows in relation to increases in the costs of selecting salespeople and maintaining them in the field.
Certainly, the direct cost of recruiting – costs such as maintaining recruiting teams and placing recruiting advertisements – are increasing.
2. Effect on Total Costs
But more important than the direct cost of recruiting is the effect that recruiting may have on the total cost of selection and training.
It may be desirable to increase the cost of the recruiting activity if it results in finding better quality applicants.
3. Cost of Opening
The costs of having an open sales territory are also great. If a firm must do a significant amount of recruiting, it should be done continuously.
Even when no immediate need for such people exists, the firm should develop a list of potential recruits.
Then when an opening does occur, the time and costs of filing that territory will be relatively low.
The time to recruit it before you have an opening.
4. High Aspirations
Finding able salespeople is not easy. Today’s recruits want a lot more than just a high salary.
In fact, candidates for sales positions place a higher value on such things as job satisfaction, fit with goals, creativity, advancement, job security, morale, etc. than salary.
5. Out of Pocket Costs
The costs associated with a poor recruitment decision are significant.
An often-quoted figure is that out of pocket costs associated with recruiting and selection range from 20 to 80% of a sales person’s annual salary.
Costs go up dramatically, however, when a poor hiring decision is made.
Costs associated with poor hiring include:
- Initial training subsequent training costs needed to overcome deficiencies.
- Costs of absenteeism, poor customer service, and excessive expense account spending associated with gradual withdrawal from the organization,
- The opportunity cost associated with lost profits that a qualified person would have generated during the time a poor hire occupies a territory.
Experts estimate that the costs of firing an employee and hiring and training a new one can run as high as 150% of the fired employee’s salary. 7 Famous Individual Training Methods for Employees (Explain).
6. Impact on the Organisation
In addition to the costs involved in a poor hiring decision, the impact of such a decision on the organization cannot be exaggerated.
Especially in the case of termination, employee morale, productivity, and client relationships potentially suffer.
7. Competitive Advantage
The recruitment of good salespeople obviously represents an important opportunity to gain a competitive advantage.
When unemployment is low, finding and hiring good performers are challenges for sales managers in every industry.
On the other hand, when unemployment is high, sales managers can make a hiring mistake from the larger number of applicants they receive.
9. Low Productivity
If the new salesperson is not a top producer, the business must absorb the cost of low productivity.
10. Loss of Customers
Established customers represent one of the firm’s most valuable assets.
If the new recruited employer is not able to provide good service, regular customers may be lost.
11. Economic Loss
If the new employee quits after a few months or must be fired, the business suffers an economic loss.
The money invested in salary, benefits, travel expenses, and training can be a sheer waste.
In other words, if appointees Leave quickly, the heavy costs of recruitment recur. 5 Major Steps in Setting Up a Sales Organization (Explained with Examples).
12. Loss of Quality Staff
Failing The Recruit the right candidate allows quality staff to go to competitors.
13. Effect on Sales Turnover
The quality of the salespeople which sales managers recruit can have a substantial effect on sales turnover.
14. Different Task
Recruitment is a particularly difficult task when operating in overseas markets.
Thus, now you know the need and importance of good recruitment.