Why do we still use outdated reward structures?

Nick McColgan, owner of Snug Kitchens in Newbury, believes that retailers need to reward sales staff in a way that ensures they give the best service to the customer

The future for our industry is bright, but only if we keep up with rapid changes in buying behaviour.

Most sales designers are paid a large proportion of their wages in the form of commission, based on personal sales figures. Is this now an outdated model and no longer the best way to ensure they are motivated to meet our client’s changing demands?

Client’s expectations and buying habits will need to be met with a fresh approach from front-line staff. This change will also demand a rethink in the way we manage and motivate our whole team.

Why do most employers still attempt to motivate their staff with outdated and unsophisticated reward structures? I now have my own business and I’m employing my own staff, which has forced me to consider this issue from a different perspective. I’m now thinking less about this month’s sales and more about the next 12 months’ figures and the long-term future of my business. This involves considering marketing strategies, my brand’s reputation, customer satisfaction and a whole load of other things that didn’t matter to me as a sales-closer.

I’m not suggesting that we shouldn’t pay our staff some form of bonus, but I am questioning the proportion of compensation that is linked directly to sales intake.

As I see it, sales-based commission as a reward has some fundamental issues:

Short-term motivation

When a potential client walks into the showroom in the early stages of a project, don’t just send them on their way with a brochure. Engage with them properly and give them valuable time and advice. The chances are it will be us that they return to.

Sales focused or customer-focused?

The days of gaining a sale by hard closing and bullying clients into signing are over. Clients are much too sophisticated to be ‘sold’ in the traditional way. If the sales designer’s focus is on their monthly commission target then their strategy and behaviour will be all about pushing for a deposit.

If we find a way of focusing on customer satisfaction instead, then the clients may not be “sold”, but there is a high chance that they will buy. This subtle difference can change the dynamic of the relationship and will lead to a higher degree of trust and consequently a lower drop off rate, higher project values, better margins and increased referral rates.

Lone wolf or team player?

If you are paid only on personal results, then why get involved in any activity that won’t affect your sales figures? We need to find a way of rewarding every member of the team, so that they are encouraged to contribute to the long-term success of the company as a whole.


How many potentially valuable team members are we missing out on by structuring pay in a way that they feel uncomfortable with? Large commission packages tend to appeal to a certain type of aggressive closer, which may no longer appeal to the majority of clients.

Customer satisfaction

Let’s face it, projects often have issues of one kind or another.  How these challenges are managed determines whether they turn into a serious customer satisfaction issue or an opportunity to impress a client. If the salesperson who has built up a relationship with the client isn’t motivated to resolve project issues, then we are relying on their goodness as a human being to put aside closing the next deal and sort out problems. Paying commission based on sales puts the reputation of my company at risk, as I can’t afford for any single customer to have a negative experience. A way of paying staff, aligned to a positive outcome for the whole project and not just the sale, is key.

If you are not sure that all of your staff are totally committed to the future success of your company, then perhaps you need to look at how you are motivating them?

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