Hiring decisions
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As vice president of sales for a rapidly growing company, you are grappling with the question of expanding the size of your direct sales force (from its current level of 60 national salespeople). You are considering hiring 5 to 10 additional personnel.
How would you estimate the additional dollar cost of each additional sales person? Based on your company's past sales experience, how would you estimate the expected net revenue generated by an additional salesperson? (Be specific about the information you might use to derive this estimate.) How would you use these cost and revenue estimates to determine whether a sales force increase (or possible a decrease) is warranted?
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Solution Summary
As vice president of sales for a rapidly growing company, you are grappling with the question of expanding the size of your direct sales force (from its current level of 60 national salespeople). You are considering hiring 5 to 10 additional personnel. How do you go about hiring.
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To estimate the addition dollar cost of each addition sales person, I would do the following:
1.I would look at the cost of hiring new sales personnel's. This entails estimating the Salary, bonuses, payroll taxes, health insurance costs and other benefits associated with the position
2. I would also look at the start up costs associated with hiring new sales people. Most often, new employees would have to be trained and it takes time before they can start to contribute positively to the company's growth. In addition, the company might have to purchase equipment for new hires.
3. It is also important to look at extra fixed costs that would be required as a result. ...
Education
- MBA, Aspen University
- Bachelor of Science , Berea College
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