How To Build a Great Sales Comp Plan So Your Best Reps Never Leave

It turns out a well-crafted sales and well-designed comp plan does retain sales reps fairly well.

Why? Well, if the comp plan is well put together, then:

  • If a sales rep leaves, they sort of have to start all over again earning their bonus, unless they get a draw. And even a draw isn’t perfect.  A standard AE comp plan is often 50/50 base/bonus.  If the AE is already making 100%+ of their OTE, or even more because they are a top AE (say 150% of their OTE) … they really have to almost start from scratch when they go somewhere new.  Especially if sales cycles are longer.
  • Top sales reps should make a lot of money. Just the top ones. So if they leave, it’s too risky to try to earn that amount somewhere new.  Again, if you are making well above 100% OTE at a good startup, it’s just risky to think you’ll surely do that again at some next startup you barely know.
  • Top sales reps tend to build up a strong pipeline of deals that will close over time. This destresses their life significantly as they have a lot of visibility into deals that will close — and personal and financial success. Top reps don’t want to leave that pipeline behind.  It’s just a lot of work to build it up again.  And it again introduces risk.

So what’s key here?

Do the above right, and you won’t see your top reps leave — other than for promotions. Because there won’t be anywhere better to go.

In fact, make Zero Voluntary Attrition an explicit goal on your sales team. Tell everyone’s that the goal.

 

 

Published on February 23, 2021

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