In response to someone asking about CPA firms' experiences with hiring a sales-person on a commission-only basis, Chris Perrino who is the long-time business development director for Barnes Dennig & Co. (a 10 partner, 75 employee firm in Cincinnati, Ohio) had some strong opinions to share on the subject today. With Chris' permission, I'm posting his excellent perspective:
My 10,000 foot view is it sounds like the partners want the best of both worlds: someone to develop business so they don't have to and they only have to pay on success not all the thankless front end work that's necessary.
If the partners will only commit to hiring with no risk (i.e. no bucks paid till bucks come in) then the firm is probably not ready for a business development (BD) person.
I think the partners need some skin in the game before they'll do their part to really make it successful. And, success might be 2 or 3 years off. The commission-only person will have starved to death by then. Hiring a BD person is a long term investment. Not a day trade.
Other thoughts...the partners want someone to think short-term by paying commission only but they probably won't like the kind of deals that are brought in with this approach (low quality or high risk). I like to think of it this way: If you want long term clients you have to have a long term BD approach. The commission only plan is short-term as mentioned above.
Also, with the economy doing better and more good jobs available, the only sales people who would accept a commission-only deal might be coming straight off the used car lot.
Chris has been in sales for 19 years (and in his CPA firm for nearly eight of those years). He is a well-regarded and frequent speaker and he consults nationally with firms on sales, selling, and aligning the sales/marketing functions to co-exist peacefully in firms.
I've known him for years and highly recommend him. Chris can be contacted at (513) 241-8313 or cperrino [at] barnesdennig [dot] com.