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Hiring a Business Development Resource

Hiring a Business Development Resource. Topics For Review Why hire a BDM Traits of Successful BDM’s Hiring terms, compensation etc… Where to look General. Why Hire A Business Builder?. Reach markets you and current team cannot SELLING Not your personal strength

talon-franklin
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Hiring a Business Development Resource

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  1. Hiring a Business Development Resource

  2. Topics For Review • Why hire a BDM • Traits of Successful BDM’s • Hiring terms, compensation etc… • Where to look • General

  3. Why Hire A Business Builder? • Reach markets you and current team cannot • SELLING Not your personal strength • May bring existing contacts that would take you a long time to develop

  4. Do I Hire a Sales or Health Care Experience? • There’s no absolute answer. • Generally selling and relationship management are INATE

  5. Hiring A Health Professional (e.g. nurse) Pros • Knows typical roles in hospitals, medical community • May have some pre-existing relationships to bring • May be able to be back-up Client Care person if needed (e.g. do assessments as required) Cons • Not likely to have the sales / account management skills needed • May not be disciplined for the independent role • May be more costly

  6. Hiring A Health Professional Recommendation: • Hire someone with selling / relationship skills over medical. Ideally someone from the seniors industry – competitor, retirement home etc….

  7. Employment Options • Employee (on your payroll) • Can be a full-time or part-time employee • Need to make source deductions • May be issues of Severance on Termination • Likely builds more loyalty

  8. Independent Contractor (invoices for services) • Requires a separate Outside Contractor Agreement • Needs to meet CRA qualifications as being truly an Independent Contractor (if not, could be tax repercussions to contractor AND you as employer). • Both arrangements can work. On balance, an employment relationship is likely better.

  9. How to Compensate ?Many Options… Salaried? Hourly? INCENTIVE pay?

  10. Salaried / hourly BUT No variable pay: • Pros: Fixes your cost • Cons: Does not link PAY To results • May be more difficult toperformance manage • Recommendation: • Some “at risk pay” is very important • i.e. a combination of base plus bonus or base plus commission

  11. Salary Plus Bonus: eg. $45,000 + $10K Bonus for achieving targets, $15K for hitting stretch targets Pros: Can pay out bonus only once per year. May promote retention. May be challenging for cash flow, (if so, structure that payout is annually but payment split between months 13 and 14 May be able to attract more seasoned selling type

  12. Salary Plus Bonus: What to base The Bonus on? • number of billable hours ? • Achieving target number of new clients ? • Specific payment for landing a given account (e.g. a hospital) ?

  13. 3. Base Salary plus “commission” • E.g. $25 per new client signed and using service • Pros: • more immediate payout – monthly? • Provides tangible rewards per sale. • Helps with cash flow • Cons: • TrackinG may be onerous • Relies on client care to close

  14. 100% Commissioned • May lend itself to retired person with communitY connections. • Likely set up as Independent • Contractor • May work when trying to secure a handful of key accounts • Could structure with a draw against commission.

  15. Handling of Expenses • Option 1 – No expenses • Require BDM to pay all his/her own expenses (e.g. mileage, parking, cell phone etc…) • BDM claims on Income Tax (You as the employer issue a T2200) • May be difficult to attract candidates on this basis

  16. Handling of Expenses • Options 2 - Pay for reasonable expenses: • Car Usage: - X cents/km. Log to be kept. Business mileage only. NOT to and from CK office. • Encourage cost savings- e.g. Go Train vs. mileage and parking • Car Usage Alternate: Flat allowance per month e.g. $300/month • Cell: company provided cell phone – more expensive (personal use?) • Cell: flat amount company pays per month e.g. $50/month – employee chooses whatever plan they want and pays bills directly. • Parking – paid on receipt.- encourage cost savings (e.g. passes at hospitals)

  17. Financial Analysis of BDM What volume of incremental business does a BDM need to bring in? • Office hires BDM at $45,000 + burden (at 15%) + $5,000 in variable pay. • This BDM costs $56,750 annually. • Offices operates at a 38% Gross Margin • $56,750 / .38 = approx $150,000 in new Sales. • $150,000 / billable rate (e.g. $21/hr) = 7,111 hours per year = 136 hours per week. If average client bills 20 hours per week, BDM needs to bring in 6.8 new clients per week. • You could further refine this to the number of referrals /week needed and factor in your close ratio of Referrals to Sales • Analysis quite different if BDM is securing contract work or hospital shifts.

  18. Recruiting A BDM • Word of Mouth : • - Ask everyone you know including your existing staff and referral sources. • Send e-mail to key suppliers, business contacts (good PR as it positions CK as expanding) • Print Ads • - May be expensive (usually least expensive is local paper • vs. National. E.g. Brampton Guardian vs. Toronto Star) • Online • -Craig’s list – free • -Workopolis – expensive (about $500-700/ad) but good uptake

  19. Comfort Keepers

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