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How Dealers Encourage Salesmen to
Increase Gash Payments
Fourth of a Series of Articles, Covering the Leading Cities of the Country, on the Ways and Means That
Retail Piano Merchants Successfully Use to Raise the Average of Cash Payments Made on
Instalment Sales—Making It Worth the While of the Salesman to Get the Cash
. n
NE of the vexing problems that every
piano house must deal with is that of
getting salesmen to co-operate to the end
lhat larger down payments and better terms are
secured on pianos sold. As one Toledo dealer
expressed it, salesmen do not sell the terms but
accept too little as the initial payment and grant
terms out of proportion to the volume of the
deal.
To be sure the prosperity of a community
has much to do with the size of down pay-
ments and the length of the terms. If work is
plentiful and wages high it is not difficult to
secure first payments of large proportions and
short terms. But if the economic situation is
the reverse of the above then small initial pay-
ments and terms extending over two or three
years are often accepted. However, it is when
conditions are normal or nearly so that piano
merchants are most concerned. Practically all
merchants agree that salesmen as a rule lack
the nerve to ask, for example, for $200 on sale
of $500 or $600 or for half down. They are
afraid to ask for a large payment because they
fear such a request will kill the deal and drive
the customer away. Ungrounded fears, for two
reasons. First, if the patron agrees to pay one-
half down then the equity in the piano usually
assures a finished deal with no comeback. Sec-
ond, if he balks at a $200 payment then the sales-
man can ask how much it is possible to pay
down or suggest a smaller amount—$150—$100.
The salesman with his own success and the
interests of his house at heart will quickly find
a way around most stumbling-blocks.
J. W. Greene Co.
The J. W. Greene Co. frequently runs con-
tests based upon large down payments and short
terms. Salesmen are instructed at all times to
strive for that result, but two or three times
a year cash prize contests arc inaugurated for
six or eight weeks at a time. Through this
method salesmen are kept on their mettle
for some time after the close of each contest.
Moreover, salesmen here are paid a salary and
commission. The salary is available each week
but the commission is paid at the end of the
month.- If it becomes necessary to repossess a
piano the salesman who made the sale must
make up the loss.
L. Goosman Piano Co.
The Goosman Piano Co. allows its salesmen
a drawing account and pays a commission on
sales. A portion of the commission is held
back, however, if the down payment is not suffi-
ciently large to give the customer a substantial
equity in the piano. Because of this plan of
recompense it is automatically to the benefit of
the salesman to secure a large down payment.
Inasmuch as down payments and terms are
closely allied with income it is essential to con-
sider the manner of paying salesmen in order
to obtain a better understanding of the workings
of the method.
Whitney-Blaine-Wildermuth Co.
The Whitney-Blaine-Wildermuth Co. allows
salesmen a commission and a salary. Here it is
regulated on a monthly basis. That is, salesmen
receive the commission on the net amount of
business for the month. Therefore, if a piano
is taken back the amount is deducted from his
sales for the month. In that way most argu-
ments are avoided and the sales force under-
stands that the sure way to avoid repossession
O
and petty fault-finding is to get a large down
payment and to shorten the terms, so that the
piano will be paid for as quickly as possible.
Certain stores have rigid rules regarding
terms which salesmen must live up to. For
instance, in one house if the cash price of a
piano is $200, the time payment price is $225
with $25 down and 12 months to pay the balance.
Terms in most piano houses for new pianos are
30 months. Few piano houses pay straight
salaries. The most successful plan here for
paying salesmen is a salary and commission
regulated to encourage large down payments
and short terms.
Seattle Dealers Do Not Believe in
Offering Inducements for More Cash
C EATTLE piano houses, as a whole, do not
believe in or subscribe to the practice of
offering any extra inducements whatever to
piano salesmen for securing unusually large
first payments and short-term contracts on the
sale of a piano. That such an achievement is
desirable they all feel, but the larger houses
state that they leave the striving for these large
payments to the pride in their salesmanship,
and standing as salesmen with their house,
rather than to the awarding of special prizes.
One manager stated that the inducements were
undesirable from the angle that the salesmen
worked so hard to receive the bonus, extra com-
mission, or what not, that they persuaded people
to invest in a piano who were not financially in
a position to do so. To people whose entire
income was already tied up with a number of
credit houses for a home, an automobile, a
washing machine, etc., the taking on of a piano
was often the last straw and resulted in numer-
ous reverts.
Another manager stated that they covered
thk issue by finding out what financial condi-
tion their prospect was in and in absolutely
refusing to sell them a piano more expensive
than their budget allowed for. He argues that
a $150 piano well sold so that it will stick is
a better sale than a $500 instrument that will
come back in six months because of the way in
which terms were arranged.
Some of the smaller houses, but houses that
are just as sound and reputable in the business
world as are their larger competitors, report
that they favor special bonuses or commissions.
One reports that although they offer such a
bonus it has no effect, as their patronage is so
wedded to the possibility of securing a piano
for as little as $10 down and the balance in
three to five years that the salesman has r\6
chance to raise the payment. Another house
reports that they have found the following
schedule most successful. They offer a flat
commission on all sales, and add a commission
on all cash or first payment sales. This makes
the salesman try to boost the amount of his
first payment, and to shorten the time of the
contract, as the longer the contract the smaller
the commissions. For instance, he signs his
prospect up, gaining a 15 per cent commission
on a twenty-four-month contract, with a 1 per
cent reduction on each three months that the
contract runs over the twenty-four months. If the
contract runs over three years his commission
is cut automatically to 11 per cent. A 2 pet
cent additional commission on all cash sale$
has been found to increase cash sales enor-
mously for this house.
One Cincinnati Piano Dealer Givel
Salesmen 2 Per Cent Bonus for Cash
an inducement to bring in more cash
A S business,
one Cincinnati piano house gives
the salesman a bonus of two per cent for cash
sales. A cash sale is defined as one in which
payment is to be made in sixty days or less.
The salesmen work on a straight salary, it be-
ing understood that a certain quota is to be
sold. This plan is regarded as successful, be-
cause the cash sales have been increasing from
month'to month. Early in the year the monthly
credit sales were larger than the cash sales, but
now the cash sales are the larger of the two.
Besides this, the total sales are increasing each
month.
The head of another house explained that he
keeps his cash sales up by thesimple expedient
of sending his salesmen into districts where in-
stalment buying is the exception and not the
rule. "I send my men where the money is to
be had, as that is the only place to get it,"
this man explained. He pays the salesman a
commission on a credit sale the minute he ac-
cepts the order, he stated, saying: "I am the
credit man and I take all of the responsibility.
If my judgment should prove to be bad, there
is no reason why the salesman should suffer, for
he did the work of making the sale. I pick the
prospects, and if I-make a mistake it is my
fault."
Other heads of piano houses interviewed have
not as yet formed any concrete plan of in-
creasing their cash sales, but all are trying to
educate the;'r "salesmen to sell mjerchandise more
and easy terms less. Thjaj.-* is, : j they are trying
to educate; the salesmen: tV*keep the matter of
easy terms in the background and devote more
effort to selling the instrument! on the basis of
Us desirability. The* underlying thought in the
minds'-*'of some dealers is to induce the sales-
men to pay more attention to people who have
money, and less to the class of people who will
buy anything, provided the terms are "easy"
enough, with a very small "down" payment on
the sale.
(Continued next week)
Race Choir for Columbia
A most noteworthy addition was made to the
Columbia Phonograph Co.'s fold when the
Seven Day Adventist's Choir became exclusive.
Columbia artists. These talented Race singers
are from Atlanta, Ga., where their singing of
religious spirituals has won wifje acclaim.