A slick Willie can put you out of business

  • 2001-06-28
  • Paul E. Adams
"The fish sees the bait, not the hook" - Chinese proverb.

Before you place your first ad seeking sales help, determine the type of sales person your product(s) and customers require. Don't hire the first warm body that offers to sell for you; it probably will be a mistake.

As you will find out, the selection and hiring of sales personnel is critical to your image and your relationship with your customers. Sales employees or agents are your representatives, and what they do and say is a reflection of you.

The wrong sales employees can cost you dearly in many ways. For example, don't assume because you are only paying commissions, that the lack of sales is not costing you anything.

Poor judgment hiring the wrong people can cost you lost sales opportunities and valuable time.

How do you know who to hire? Study your customers. Learn how they buy. What do they expect in the way of sales service?

How are your competitors selling their products? What is required in the sale of your product? Does success require repeat sales? Or, is it something purchased infrequently, such as a new car, home air-conditioning or capital machinery?

How much technical knowledge is required to sell successfully? How aggressive must the salesperson be? How much experience do you require? Must they have a customer following?

These is just a mere sampling of the questions you should really ask yourself before writing your "help wanted" ad.

Do not overlook the fact that your attitude and perceptions of salespeople will influence your hiring practices.

Will you consider your sales employees part of your company, or outsiders only interested in themselves? Will you trust them to work independently or assume they spend the afternoons on the golf course?

Here's a story about a man named Russell Watkins. Russell found himself under investigation by the FBI because he had hired the wrong person.

His nightmare began with a help wanted ad. Russell was struggling to keep his company alive; he desperately needed sales and placed an ad in a local paper looking for sales and marketing help.

The first few who answered the ad did not seem right. But then Vinnie appeared. He was dapper, well-spoken and charming. He had all the right answers.

He claimed many years of sales and promotion experience with a series of firms in multi-level and franchise selling, including the director of franchising for a well-known entertainment company.

However, because of a messy divorce, he had just moved to Florida and was now starting over. Russell was convinced Vinnie was the person to help him save his company.

Vinnie was a master of selling ideas - he thrived on it. The first thing he did was to promote the idea of multi-level selling by persuading prospects to invest in "distributorships."

To attract customers, he placed classified ads in a host of weekly newspapers promoting exclusive distributorships that promised immediate high profits with little selling required.

Vinnie assured each potential "distributor" that their investment in inventory was fully refundable if not satisfied in any way.

Vinnie was smooth. His sales presentations were an art form.

According to Vinnie, all the new distributor needed to do was place a prepackaged display rack with an assorted inventory in various retail locations and wait for the money. He was a master at appealing to a person's greed.

For the first few months, the money was flowing in from the "appointment" of distributors. Vinnie was collecting hefty commission checks and Russell was happy; it looked as if the company was going to succeed.

Then disaster hit. The inventory was not selling at the retail locations. Distributors were becoming unhappy and demanded to return the product and get their money back.

To find the money to refund the original distributors, new distributorships had to be "appointed." Vinnie's plan had become a Ponzi scheme. Because of the initial success in selling distributorships, the problem grew rapidly.

The situation became desperate and Vinnie's promises more outlandish. It soon became impossible to refund everyone's money and the inevitable happened; complaints of fraud were lodged against the company. Vinnie took off.

Russell tried to honor the promises to the distributors as best he could to avoid any prosecution on fraud charges.

He borrowed from friends, refunded what he could and quietly closed his business. He did not even have money to file for bankruptcy. He just indicated "no activity" on his tax returns. He still retains the experience as a bad memory and has no interest in being in any type of business.

Russell's nightmare could have been avoided with a check on Vinnie's past. Any of his former employees would have told Russell that Vinnie was a shady character and completely amoral.

A credit reference check would have revealed a long list of creditors chasing him for numerous defaults. A few questions to the right people would have spared Russell his ordeal.

The world is full of smooth talking "slick Willies." Don't hire them if you wish to stay in business.