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As hiring in sales sector trickles back, beware the counteroffer


While hiring in the sales sector has been close to nonexistent for most of the year, companies are looking to hire in the first quarter, according to Brian Casey, division manager of Treeline, a sales executive recruitment firm.

Casey, whose clients include AMR Research, Eli Lilly, Forest Laboratories and IBM, said that if VPs of sales and sales managers want to hit their 2010 quota numbers they have to ramp up headcount.  “Most sales organizations were cut to the bone to sustain revenue, but to grow you need to add sales representatives who can penetrate and land new business.” 

Hiring may still be tempered by what the economic mystics and statistics tell us will be a slow and painful recovery. “With such sluggish growth, the unemployment rate will likely peak at 10.5% in the first quarter and remain at or above 10% for almost all of next year,” the UCLA Anderson Forecast group said this week. (The group forecast that real GDP growth will settle into a 2% growth path for most of 2010 and be closer to 3% in 2011.)

For sales managers who are ready to pull the trigger on new hires, they have to be doubly if not triply sure that they have settled on the right candidate. With budgets squeezed by the anemic economy (not to mention all of the secular changes in many industries wrought by the Web), sales managers are expected to play hardball when faced with the prospect of losing one of their top producers to the competition.

Call it the counteroffer syndrome. “Companies are being much more aggressive in trying to get people to stay,” Casey said. “You’re seeing more counteroffers than ever, so companies need to recognize that they could lose that talent to [the person’s existing employer] and have to start the process all over.”

For example, Treeline recently had a technology sales rep sign an offer with one of its clients.   After the candidate gave notice to his current employer, he received a counteroffer that would increase his base salary by 12%.  The candidate decided to take the counteroffer because he did not think Treeline’s client was as aggressive in matching it.

Because there’s more risk these days that you may hire someone who is snatched back by the company he is currently working for, hiring managers must arm themselves with better intelligence going in. “Organizations need a set of criteria [for hiring],” Casey said. “You have to understand the marketplace, understand the nature of why someone would want to make a move and be prepared for counteroffers.”

 
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December 10, 2009 - Posted by | Best Practices | , , , , , ,

2 Comments »

  1. Very good insight into the market. I feel that the message as a whole is spot on except for the opening line; it has been my experience that although hiring in the sales sector has slowed down considerably – it is far from non-existent. Good write up.

    Comment by Sean | December 14, 2009 | Reply

  2. Thanks for your response Sean. Ant anecdotal evidence you may have re hiring trends in sales this year?
    Cheers,
    Matthew

    Comment by mpschwartz | December 14, 2009 | Reply


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