7 Mistakes You Might Make When Hiring Your First Sales Rep
By: Carrie Richardson, Partner, Richardson & Richardson Consulting
Hiring your first sales rep is a harrowing experience for most leaders. The first time I hired a sales rep for my business, I hired them with a very limited amount of historical data. Our company had grown more than 600% in in our third year, pushing us well over the 1MM ARR mark, and it showed no signs of slowing down.
I was running out of bandwidth, I was excited about the trajectory of this business that only the year previous I had considered shuttering to go work for a client, and I thought I was a pretty savvy businessperson – look at this amazing thing I’ve built!
We began recruiting for the role, as many business leaders do, using our network. In an interesting turn of events, we hired someone who had worked for a previous client. As we shared the same point of contact, we were empathetic about why he was frustrated with his role. We didn’t check references, we were very excited about the hire. In fact, we won earned media promoting the fact that we had hired them.
Slowly, our joy turned to questioning, and our questioning turned to resentment around the payroll spend – after all, I was paying our new salesperson more than I reliably paid myself at this time.
A Bad Sales Hire Is Usually the Result of a Bad Hiring Process
Our numbers didn’t hold.
My resentment grew.
My new sales executive saw themselves as more of a leader, and less of a day to day activity person. They weren’t willing to make the 50 or 60 calls daily that I had made every day. They relied solely on their relationships within our industry to try to build their pipeline.
On day 120 we terminated their contract. We had $50,000 less in our bank account, and our pipeline had flattened.
I blamed the sales rep, but hindsight being what it was, I can now look back on this experience and see who was to blame.
It was my fault.
I failed in a many different ways, but here are my biggest takeaways:
7 Steps To Making Your First Sales Hire Your Worst Sales Hire
- Hire someone you like and don’t follow any defined process for hiring them.
- Overextend or leverage yourself to afford their base salary.
- Find someone with previous experience in your industry so you won’t have to train them.
- Do not write a detailed job description with clear expectations of daily objectives.
- Take no time to understand your sales cycle, review historical sales data or create realistic KPIs
- Spend no time documenting your institutional knowledge or processes.
- Don’t lead by example.
Hiring Your First Sales Rep Without Following Your Defined Hiring Process
We had a hiring process for the agents that supported our calling agency.
We rarely deviated from it when hiring agents, but we didn’t follow any of the processes we had previously defined for recruiting, interviewing, referral checks, training plans or coaching. We knew them, they knew us, everyone was friends.
While our relationship with them did not end when we needed to terminate, it was never the same. Working with friends and family is difficult, and should be given careful consideration.
Are you willing to terminate this person if it doesn’t work out? How will that impact your family relationships and your social circle? Are you the only person advocating for this hire? Make sure your whole team is aligned behind the choice you make, and follow a defined hiring process for all hires – even if you went to kindergarten with them.
Overextend or Leverage Yourself When Hiring Your First Sales Rep
Our average agent salary was $32,000.00 per year. My salary was $75,000.000 per year. Our new sales rep? $120,000.00 per year. Of course, I was resentful when they weren’t able to perform at my level.
Not only was our pipeline drying up, but my bank account was following our pipeline. Ensuring you’re able to financially weather the period between your new hire starting and your new hire producing revenue is an essential component to a successful sales hire. When you’re financially strained, you may find yourself micromanaging even your most talented employees. You hire someone to eliminate stress, not add it.
Find someone with previous experience in your industry so you won’t have to train them.
I’m not sure if this is the most important cautionary tale you can take away from this overview, but I assumed that someone who worked in our industry would require very little training and support and looked forward to watching them hit the ground running.
I didn’t provide much in the way of training or management support.
They worked remotely, and I assumed a person at that point in their career would have everything they needed to support ME. I forgot who the leader of the business was – it wasn’t my new sales rep – even with ten years more experience in our industry, they still needed to be supported, and I failed to do my part.
Do not write a detailed job description with clear expectations of daily objectives.
I have always relied heavily on cold outreach to build my businesses. I like to get my hands dirty, and I prefer the call floor to the corner office. My new sales rep fancied themselves as an executive, not a call center agent, and they didn’t approach selling the way I did.
I wanted a sales executive who would do what I was doing, because it was getting the results that I wanted. I would have saved myself a ton of grief and cash by simply writing out a detailed job description and outlining exactly what I expected from my new hire on a daily, weekly, monthly and quarterly basis. (Richardson & Richardson recently made a new hire, you can see our detailed job description here!) When hiring your first sales rep, make sure your expectations are clear from the interview onwards. If you want a “do-er”, and they fancy themselves above the day-to-day actions that you expect them to do, an outline of “a day in the life” will help the sales reps that won’t fit in with your culture self-select out without wasting any of your time, or theirs!
Take no time to review historical sales data or create realistic KPIs
We were enjoying a year of unprecedented growth.
We failed to recognize that the reason this year was so strong had everything to do with the sales efforts two years previous.
Our sales cycle was long.
Our clients would often balk at the price of our services, then try a competitor, then try to build in house, then come back to us to partner with us.
We didn’t realize this at the time, and had we spent any time looking at our sales pipeline before hiring, we would have had a better understanding of our client’s buyer journey, and we likely would not have hired a 6-figure sales asset to start the sales process.
We would have primed the pump for two years with a much less expensive, less experienced rep and potentially brought in a high-priced closer in year three when our pipeline would have supported it.
We expected results immediately even though our historical data proves that our sales cycle doesn’t work like that. If you don’t understand important metrics like your sales cycle, your average lifetime client value, your cost per lead, or your cost per deal, not only is it not time to hire an expensive sales asset, but it’s also not time to partner with any outsourced sales or marketing support agency.
Know your numbers – holding anyone accountable is impossible without having data.
Spend no time documenting your institutional knowledge or processes.
I’m sort of a savant when it comes to lead generation. However, being good at something in a silo benefits nobody but you – and it won’t benefit you at all when you need to move your attention elsewhere.
I can 100% add over a million dollars in recurring revenue in one year myself.
I know this, I’ve done it three times.
However, I couldn’t explain how I did it, and I didn’t have the patience or the willingness to sit with someone who could assist me in turning what seemed to come naturally to me into documentation and processes that could help people in my company replicate what I did.
Like most visionaries, I found details frustrating. I also found it surprising that anyone would struggle with a task or a process that was so easy for me.
How could this even NEED documentation?
You pick up the phone.
You talk to people.
How hard is it?
It’s actually pretty hard.
I wasn’t a naturally gifted salesperson. I was a normal human who had been in sales for almost 20 years by the time I started my business. I had been supported, well trained, and guided in my junior roles by good leaders. As the business owner, I could do whatever I wanted to close deals – skip steps, discount, make concessions, change a process.
That created chaos in my business and when I had to move my focus off of sales to anything else, our pipeline always suffered.
Don’t lead by example.
The most important lesson I learned hiring badly was this:
If it’s not important to me, it’s not going to be important to my team.
My team doesn’t read a training manual to understand what is important to me – they watch what I do. If you’re training the trainers, the trainers know what is “really important” and what is just lip service to a process manual. If you want to succeed when hiring your first sales rep, make sure you’re not expecting them to guess what they are really supposed to care about.
Your business will become the sum total of your actions, not the sum total of your ideas.
If you’re struggling to create the process and documentation you need in order to hire your first sales rep, Richardson and Richardson can help. Check out our white papers, and schedule a 90 minute meeting to decide if you’re ready to build the sales team your business deserves.
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