Ok, so this is a topic that I get easily excited about.  So forgive my, “passion” here today.  I often hear HR managers or Sales Managers say, “we are hiring sellers!”…”oh, but we don’t pay recruiting fees.”  This is when I get “passionate.”

According to a recent study done by the Society for Human Resource Management, the cost to hire and retain a quality seller is $4,129 plus 42 days to fill which undoubtedly has a cost associated with it as well.  Whether you are giving a fee to an agency or not, trust me when I tell you, that you ARE paying for it!  Let me explain this categorically.

The Role of H.R. in the recruiting process

So if your company is large enough to actually have a recruiting department, I want you to close your eyes for a minute and think about this organization.  Think about the process from building job postings, to soliciting, to reviewing resumes, to scheduling interviews, to negotiating offers.  Now think about all the tools, people, etc. that go into this process.  Take a rough guess at the cost of this.  Probably a sizeable number.  OK, I get it, this is probably a sunk cost, so how does this justify further recruiting fees?  The answer lies in the accuracy of the process here.  HR is the tip of the funnel in identifying talent.  This comes in the form of resumes and job fairs.  No offense to HR people, but I will bet you most sales managers don’t have a high opinion of their ability to identify quality sales talent.  On top of that, I spend time mentoring young sellers on interviewing, and I have seen some really creative resumes.  I don’t know how an HR manager could truly pick the right 10 resumes out of a batch of 100 submissions in this day and age.  Oh, you use AI systems to filter.  Hah!  Trust me, I love AI!  I am currently writing this blog in a 15×12 office which contains both an Amazon Echo AND a Google Home Hub.  But, Alexa doesn’t select my sales reps for me.  To really get underneath the justification here, there is a bit of taking cost out of the process, but more it’s about the cost of making a bad hire, which we will cover later in this blog.

The Role of the Sales or Hiring Manager in the recruiting process

OK sales managers, I am calling you out here.  After managing salespeople for 20 years now, I feel comfortable doing this.  Let me start by asking you a similar question to the one I did above.  What is your involvement in the hiring process?  How much time will you spend?  Assuming you answered the second question with 40 hours or more, I would ask yourself, how much are 40 hours of your time worth to your company?  A recent study showed that an average company loses 1-2.5% of its total annual revenue based on the hiring exercise.  Spending time recruiting, interviewing, calling references etc is a fairly taxing exercise.  It’s also typically elongated when left to a manager who doesn’t usually have a stack of resumes and contacts to draw from.  So now you are talking about the loss of dollars based on having an empty territory.  So sales managers, if you really are good salespeople, you should understand the cost benefits here of a recruiter, and be able to sell yourself on the fee, or your HR department.

The Cost of Making a Bad Hire

Thinking back to the processes I described above.  If you are hiring from unknown candidates, stacks of resumes, you know how much guesswork can go into hiring a salesperson.  Typically when you get down to final candidates, it’s usually a second interview and then offers.  So this is maybe two hours with someone and a call to the references he or she has teed up to say great things about them?  I have made bad hires.  This category is likely the most costly of them all.  Not only the wasted salary you will put on someone for six months before letting them go, but also the lack of results.  Recruiters have their reputation at stake and also have a superior vetting process to the ones you might employ.  Thus, the likelihood of a quality hire should be much higher.

The Cost of Hiring Entry vs Seasoned Sellers

This last one is a bit unique to the TechQualled recruiting and placement process.  I spoke about this in depth in my last blog.  This is basic math.  How much would you say you would pay an entry level sales person in year one?  $60K base?  $85K On Target?  How about a seasoned seller?  I know the answer to this one, because 25 years into this, my friendship circle is comprised of people who fit this bill and are moving around.  The going rate is a base of $150K, and OTE at $250 plus.  And the key here is, they do not have the patience for a year one miss of OTE while they build the territory.  So why does this matter?  Again, basic math.  If you can bring in someone that is an experienced professional at a $85K base, OTE of $150, and a patience level that it may take 12 months to build out the territory to get to OTE, then why can’t you build the case for the recruiting fee?  You are spending less than you would on a proven experienced hire.

Why TechQualled?

Sure there is a fee associated with hiring a seller from TechQualled.  However, I think the TechQualled approach goes a long way in justifying the numbers based on the categories above.  More so than both a do it yourself hiring model, or a traditional recruiter.  Let me provide some bullets here:

• Cost of HR – No sifting through resumes, looking for candidates, training them.  We have them, and they have been thoroughly vetted and trained.
• Role of the Hiring Manager – No lengthy search for candidates, interviews, references etc.  Simply look through a cohort of vetted candidates (typically 12-16), select the ones you want to review and then carve out a full or half day to watch them in their role plays.  Better than any interview you will put together.  I promise.
• Cost of a Bad Hire – Not a shot in the dark here.  These people are proven leaders in their roles in the service and have now been fully trained as sellers.  This, plus the ability to witness them in action mitigates the risk of a bad hire.
• Entry vs Seasoned – These individuals had serious responsibilities and leadership.  You will not struggle with having to spend time daily guiding them on what to do next. Additionally, they are not a seasoned seller who EXPECTS a baked territory and $300K OTE in year 1.

In summary, the value in all of this far exceeds the cost of the fee.  If we can help you build out your sales team and overcome the objection on paying a fee, please reach out to us.  Or just join us for a roleplay session online or in person (Fort Worth March 20-21).