Currently Reading

A Unique Sales Compensation Structure That Increases Retention

Home Improvement

A Unique Sales Compensation Structure That Increases Retention

How Homefix Custom Remodeling Executive Vice President Nick Roberts created a system to keep his best home improvement salespeople longer

By Nick Roberts August 3, 2023
How home improvement companies can retain salespeople
Photo: boygostockphoto | stock.adobe.com

Every commission-based sales company faces attrition with sales reps. One of our jobs as leaders is to try to create careers for people and keep them at our company longer.

I believe there are four pillars of happy employment: money, culture, advancement, and autonomy.

Managers often look at advancement as a need to promote somebody. But, what I really think people are looking for is mastery or advancement in their chosen field. If they feel as though they're getting smarter, they're making more money, and they're progressing themselves career-wise, that’s just as powerful as a promotion in a traditional sense.

This compensation structure has been an immediate help on retention within our sales team. Being able to show reps a path where they can constantly increase their standing and their pay is a big deal.

We live in a world of instant gratification. There used to be a bit more patience when it came to advancement. People were committed to working in companies for four or five years before they moved on. Now, what makes retention a little more challenging is that you have to show advancement opportunities much sooner.

A New Kind of Sales Compensation Structure

So, we at Homefix instituted a three-tiered program for our sales team with extra benefits at each level.

Everybody starts on tier one as an associate. It’s an introductory level where each sales rep goes through a basic training process and has a set commission. When they reach one million dollars in sales, they move up to tier two and earn the title of consultant.

It’s performance-based, but there is no stipulation on how fast they need to get to a million dollars. So, it not only encourages people to perform but also to hang in there if they’re not wildly successful right away.

When consultants reach three million dollars in total sales, they move up to the third tier and earn the title of senior consultant.

Listen to Nick Roberts discuss the benefits of his sales structure on the Rock Stars or Remodeling podcast:

Increased Perks for Sales Reps

As sales reps move from tier to tier, we give them extra perks at each new level. We stipend people at higher tiers to give them the feeling of consistent pay. Once they receive any given stipend like having gas or phone expenses covered, they receive it for as long as they’re employed as a sales rep with us. We also give our reps a customized Rolex when they reach seven and a half million dollars in sales.

As reps progress through the tiers, they want to get to the next level as quickly as possible for even more guaranteed pay and perks. They don't have to become a sales manager or a vice president to make more money.

Big Benefits for Our Business

This tiered system also helps us hone in on who our future leaders might be. Every company should have an idea of who its best prospects are for future leadership roles. By seeing how fast sales reps progress through these tiers, we can identify who those people are and begin working with them on things that we might look for from them in the future.

This compensation structure has been an immediate help on retention within our sales team. Being able to show reps a path where they can constantly increase their standing and their pay is a big deal. We're getting better performance because the sales reps are trying to reach the next level.

Overcoming Objections from Sales Reps

The main objection to this system would be the change itself. But, I don't see how it hurts. If there's no negative drawback to it, and it’s giving sales reps incentives to work towards, then why not attempt to put yourself in a better position to hold on to your people longer?

Everybody hates change, especially salespeople. They are creatures of habit. But if the change is framed in a way that makes them feel they're winning, then you as a business owner or sales manager can’t lose.

written by

Nick Roberts

Nick Roberts is the Executive Vice President at Homefix Custom Remodeling, an exterior remodeling company with eight locations throughout the east coast of the United States. He is a member of Pro Remodeler’s Forty Under 40 Class of 2023 and he worked his way up from a canvasser at his company to the leadership position he now holds.

Add new comment

Plain text

  • No HTML tags allowed.
  • Web page addresses and email addresses turn into links automatically.
  • Lines and paragraphs break automatically.

Related Stories

The 5 Most Dangerous Practices for 2024

Common mistakes contractors must avoid to stay out of legal trouble

How Mission, Vision, and Values Drive Exceptional Customer Experiences

By aligning these three core principles, contractors can create raving fans who refer their business for life

5 Dangerous Practices That Get Contractors Into Legal Trouble

On this episode of Rock Stars of Remodeling, home improvement attorney D.S. Berenson shares common practices contractors should avoid


Diamond Kote® Building Products Introduces New Products to their Complete Siding System™

 Siding trim innovations that save time and hassle

Where Home Improvement Contractors Go to Grow

On this episode of Rock Stars of Remodeling, Certified Contractors Network Vice President Gary Cohen shares how home improvement companies benefit by connecting with a community of successful contractors

5 Tips To Shorten Your Path To Success

Director of Home Improvement Drew Barto shares what contractors can do to gain industry knowledge sooner and grow their businesses faster


Exterior Renovation Transforms Home into Neighborhood Showpiece

Contractors recommend ProVia doors, windows, and siding to boost curb appeal and provide long-term value

How To Close More Internet Leads

Four techniques home improvement companies can use in marketing and sales to generate and close more web leads

Leaf Home Hires Chief Growth Officer as Company Continues to Expand

Nina George joins the large home improvement company and will drive efforts to add new locations and new product lines

A Sales Compensation Structure That Helps Increase Retention

On this episode of Rock Stars of Remodeling, Homefix Custom Remodeling Executive Vice President Nick Roberts offers insight into his innovative tiered sales compensation structure that has helped increase retention within his sales team


More in Category