Typically, there are two primary reasons why you would consider employing a salesman. First, you may not be the best at selling your product to the consumer or larger retail environment. Second, your product may not be making you enough or any money. Unfortunately, not every inventor is in a position where they can afford to hire a salesman but, there are options to consider depending on your situation.
Employing a salesman is not an option for every inventor but, it is one to seriously consider. Many new inventors are convinced that their product or service will sell without any difficulty or objection. Because of this, they often employ a salesman right away with the belief that product sales will cover the salary for the salesman. However, this does not work out most the time. In fact, it is a rarity! You should only employ a salesman to market your product when you have already made sales and tested the market. Never assume that your product can sell itself.
Some salesmen prefer to be paid an hourly rate or a straight salary while others choose to work on commission. Those who work as commission-based salesmen, often require payment in advance to help get them started. This option is viable and worth considering but leaves many to question whether or not the salesman will be able to make the sales after the initial fee is paid. As I continue to stress in each step of the invention process, research is vital. Check the references of the salesman, ask about his or her portfolio, and have him explain his history in sales as well as any successes or failures. Essentially, you have to determine if the salesman has actually been as successful as he or she claims. The only way to do this is to ask to see some sort of proof.
Money makes the world go around. People need money to survive and often do not do something without expecting something, usually payment, in return. I have previously mentioned how you can give shares of your company to someone who believes in your product and can directly contribute to its success. This is a great way to engage the individual while exhibiting your belief in the product or service. However, it is not as easy as it sounds.
Offering shares of your company to someone requires a great deal of belief. The person has to believe that he or she can successfully sell your product, contribute to its overall market presence, and effectively earn his or her shares. The last thing that you ever want to do is give away shares of your company to someone who cannot sell water in a drought.
If you are considering offering shares of your company, a contract is vital to outline the agreement. In the contract, you need to specify how much margin you are giving away as well as a target of sales to achieve and the specified timeframes. If you fail to outline these three points in your contract, you are setting yourself up for a potential loss and a great deal of heartache if you ever have to get your shares back. Remember, keep every agreement and detail in writing to ensure that all of your bases are covered, especially when it comes to giving away shares to your company.