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THE MUSIC TRADE
DECEMBER 13, 1924
REVIEW
Making the Sales Organization a Unit
Methods Which Retail Music Merchants Throughout the Country Are Using to Bring About a Greater De-
gree of Co-operation Between the Salesmen on the Warerooms Floors and the Salesmen in
the Outside Organization—Checking a Fertile Loss of Lost Sales
T
HE chief organization problem of many
retail piano managers, and of dealers en-
tering the field, is that of establishing
some definite form of compensation for both the
outside and inside salesmen so that they may
work together in harmony to the common end
of making sales and at the same time realize in
full the proper reward for their efforts.
More than one dealer, or manager, has seen
actual dollars walk out of the store, as it were,
because the floor salesman for one reason or
another was not inclined to co-operate fully
with the outside salesman in closing sales to
prospects brought into the warerooms through
the efforts of the outside man. On some oc-
casions this lack of co-operation might be as-
cribed to lack of interest and ambition, while
at other times it is directly traceable to the
natural inclination of the floorman to give his
chief attention to closing those sales for which
he, himself, is directly responsible.
The piano salesman, just as is the case with
the salesman in any other line, is working to
increase his income, and is going to show the
greatest interest in those things which will
make for greater returns. In developing a
system of compensation, therefore, the dealer,
or manager, endeavors to so regulate the re-
turns of the floorman that it is directly to his
interest to close the sale for the outside sales-
man quite as much as though it were his own.
In planning a system of payment for sales-
men that will insure the greatest co-operation
it is but logical for the dealer, or manager, to
follow and adopt methods that have already
proven successful. In an effort, therefore, to
bring to light those systems which have proven
most satisfactory in the piano trade itself, The
Review has made an extended survey with the
result that there are presented herewith nu-
merous plans of compensation which are al-
ready working properly to the satisfaction both
of the concerns interested and their salesmen.
Naturally, there is a marked difference be-
tween the various methods outlined, but all of
them are designed to keep the inside and out-
side men working in close harmony to a com-
mon end and to give each a fair reward for his
efforts.
It is, of course, conceded that the
floor salesman should receive a definite salary
in every case consistent with his proven ability
as a sales producer. In practically every in-
stance this practice is followed and then there
are a variety of methods for keeping him work-
ing at top speed either through the grant-
ing of an extra commission on each sale or
of a definite bonus paid on all business done
over and above a specified quota.
It appears to be the general opinion that
the inside salesman is most inclined to co-
operate fully with the outside man when he is
working on a basis that provides a fixed form
of compensation for every sale made, whether
it is to his own prospect or one sent in by the
outside staff. Under this plan the floor sales-
man is working to build up a definite volume
of sales for the year and he is going to work
just as hard to close the outside salesman's
prpspects as he does his own, for they both
represent an equal value to him.
Another plan that appears to work well is
that of paying the inside salesman a definite
but small commission on all sales closed for
members of the outside staff, this extra com-
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mission being paid by the house with the out-
side man receiving his full return, or, on the
other hand, being paid* out of the commission
due the outside man. It is found that this
system brings best results when this commis-
sion is paid by the house, for it enables the
outside man to work his territory with an easy
mind and the assurance that he is going to
get full credit for the sale that is made in the
warerooms whether he is there or not. If the
outside man is forced to meet every prospect
in the warerooms and close the sale personally
to secure the full commission, he is going to
waste a lot of valuable time on the floor and
take that much time from the field. Most
houses feel that keeping the outside man in
the field for the major part of his time is worth
a small extra commission to the closer on the
floor.
Facts From the Survey
The survey brings to light the fact that there
is no one system that is so generally in use
as to make it appear as standard, but there
arc many good plans, any one of which should
be worthy of adoption by the dealer or man-
ager who has any trouble in that direction.
The main thing is to have a definite and fixed
system under which the salesmen, both inside
and outside, know in advance just what they
can expect from the sale regardless of how it
is made. One of the greatest mistakes is for
the manager to attempt to regard each sale
as a separate unit in the dividing of the com-
pensation for one or the other of the sales-
men is, nine times out of ten, going to be
dissatisfied with the verdict. More trouble has
developed from these prcemptory adjustments
than from any plan that is laid down in ad-
vance no matter what its terms.
For the information of the trade in general
there are presented herewith reports of just
how dealers in various cities handle the ques-
tion of salesman compensation. The reports
are full of information and should prove of
distinct value to the piano merchant who is
having more or less trouble on this score.
Philadelphia Merchant Finds Bonus
System Effective in Meeting Problem
the compensating of salesmen a few of the ment to put forth their best efforts in closing
I N local
firms have the salary and commission
deals. Of course the commission is the induce-
basis of sales while still fewer have a commis-
sion proposition only. In the case of the salary
and commission policy there is usually a divi-
sion of the commission between the inside and
outside men when a deal is actually closed.
Where commission only is allowed an even
split is made of the compensation.
Dealers are partial to the salary basis of com-
pensation as their experiences point to this
form of remuneration as being the best means
of maintaining harmony among the forces. It
also promotes a high standard of ethics on the
part of the workers, eliminating the petty
squabbles which are likely to result where the
commission plan is followed exclusively. It
does not tend to promote a feeling of indiffer-
ence, as some might assume, for all the sales-
men are aware of the fact that their continu-
ance in the service of the firm depends upon
their sales record and they are urged to develop
their ability for personal advantage by the
knowledge that more sales mean more salary.
Bonus on Departmental Sales at Heppe's
Although the most popular form of compen-
sation is a straight salary, one of Philadelphia's
most prominent piano dealers, C. J. Heppe &
Son, has besides this a monthly bonus arrange-
ment with inside men which offsets the com-
mission allowance. In analyzing the benefits
of this form of compensation President Flor-
ence J. Heppe, of the firm, states that by giving
the straight salary and a bonus to the inside
salesmen the outside man feels at liberty to
send customers to the store, realizing that he
will enjoy the best efforts of his co-worker in
closing the deal. The outside man also will
be assured of his commission as well as salary.
By this system the Heppe company has estab-
lished complete co-operation in closing a deal.
The bonus allotted to the inside forces is not
on the individual sales record but on the net
business of the entire department, an incentive
for all representatives of that particular depart-
ment for the sales ambitions of the outdoor
worker.
Commissions Based on Terms Obtained
Quite another method of reimbursing the
sales organization is followed by Sales Man-
ager George Boyd, of the F. A. North Co.
Here all the floor men are on a salary with
commission for cash or short-term contracts.
Outside men get a regular commission and a
term bonus. This idea originated with Ben
Platt, head of the Platt Music Co., of Los
Angeles. The idea is worked out in this way—
the salesman has a deal for a $1,000 piano with
no "trade-in," which will give him the commis-
sion on $900 for the cash price. If the piano
is bought on a short term he will receive a
stipulated commission, which is regulated on a
scale of term payments according to the length
of time and ranging from 18 to 24 months or
even as long as three years. The shorter the
term contract the larger commissions. On long-
time payments no commission is allowed to the
inside men. The outside man gets his com-
mission on any and all sales closed.
Manager Kohnheim's Original Plan
In the Quaker City branch of the Story &
Clark Piano Co., Manager Jules Kohnheim has
his own special sales groups of a "captain" and
his subordinates or junior salesmen who work
the outside while the captain remains on the
floor to close all deals. These captains have
their own desks or departments arranged along
the side of the store, according to their ranks
of 1st, 2nd or 3rd captaincy, with the duties
of managers to the various crews coming un-
der their departments. The canvassers are paid
on a commission basis only. Captains are al-
lowed commission and salary. In event a cap-
tain is off floor when a customer of a canvasser
of his department comes to the store then he
forfeits his commission to the captain or man-
ager of the next group below his rank or prac-
(Continued on page 9)
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