Sales and Business Models in the Logistics Industry by Alexander Nowroth

Author:Alexander Nowroth
Language: eng
Format: epub
ISBN: 9783658397562
Publisher: Springer Fachmedien Wiesbaden

3.2.2 The Right Sales Team Size

Applying the Pareto principle to team performance, it states that in nearly all sales organizations come to a strong imbalance in the distribution of performance: 20% of sales staff generate 80% of sales or more. Sometimes the distribution is also 30 to 70 or 10 to 90%—let’s assume for a moment that it is 20 to 80%. Does this mean that 80% of sales staff do not do their job? Not necessarily, because different factors such as company affiliation or experience play a role here. Basically, however, it can be assumed that half of the 80% simply does not do what it could do. This group does not cover its own costs, often not even half of them. Assuming that the relevant employees were immediately assigned to another company division or even released, the changes in terms of the team’s overall performance would be insignificant or even negligible. An example calculation of the improved profitability is shown in Fig. 3.1.

Fig. 3.1Example calculation improved profitability of the distribution

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