How to Terminate a Salesperson

One of the most challenging and critical responsibilities of a sales team leader is knowing when and how to fire a salesperson. While terminating any employee is always somewhat painful and stressful, letting go of someone who has direct contact with a company’s clients and prospects can be a potential minefield if not managed correctly. A disgruntled, former salesperson can do a lot of damage to a company’s reputation and can very well take existing clients with them when they move to a new position.

That being said, sometimes a company may be better off firing a salesperson than keeping them on board. If managed effectively, the potential for anger, retaliation, litigation, or worse, can be minimized, and the outcome after a termination can be positive for both the company, as well as the salesperson.

Before any notion of firing is entertained, it’s crucial to review whether or not you and the company as a whole have provided the training and support for the employee to succeed. Too often, companies pull the plug on a salesperson without giving them the adequate tools for success. Even the most competent professional needs ramp up time unless they are coming to the organization with an established book of business.

If there is any inkling of a potential problem, management should be taking an active role in the salesperson’s day-to-day operations. Much can be learned by simply joining them on sales calls to key accounts.

Take the time to ensure that their sales activities and notes are properly maintained in a CRM system. As a team leader, you should be reviewing your employees’ files and information on a regular basis.

If the problem is stemming from a lack of training, it will be far more constructive and cost-efficient to retrain rather than simply discipline and terminate.

Through the process of any evaluation, keep the lines of communication open, and always provide clear direction and honest feedback.

And, it can never be stated enough in any situation involving disciplinary actions or terminations – Document Everything! Give both verbal and then written warnings and be very clear on what is expected.

Ask yourself the following questions if you are considering the possibility of terminating a salesperson:

Have you given an adequate amount of time for them to build up their sales pipeline, learn the business, understand their territory, and acclimate themselves to the company?

Have they been given the training that they need to succeed?

Have you provided sufficient support?

If you can honestly answer yes to each of these questions, and their lack of performance and/or behavior seems to be the common denominator in the problem, firing may be your only choice. Unfortunately, some salespeople are negative forces to be reckoned with and often alienate other employees. Others ask for too much and believe that they can hold you hostage because they have good sales numbers. A “diva” salesperson is never good for an organization. The unfortunate reality is that a truly problematic salesperson can have destructive and devastating effects on a sales team and a company as a whole and needs to be removed promptly and efficiently.

Once you’ve determined that you have a proverbial “bad apple,” you’ll need to begin the unenviable, yet necessary process of termination. Gather your notes, files, and any other backup documentation and have them at your disposal before you sit down with the salesperson. If possible, have human resources or another senior executive attend the termination meeting. Ideally, terminations should be carried out early in the week, and in the morning hours. Firing someone at 5:00pm on a Friday before a holiday is certainly the way to incite added anger in an already disenchanted employee.

It’s never enjoyable to sit down an employee and tell them that their services are no longer needed. However, this is not the time to let your emotions get the best of you. Be clear and to the point. Explain why they are being fired and cite specific reasons. If there were prior performance warnings, this termination will probably not be a surprise. Do not lose your composure. Stay professional and maintain an even tone of voice. Keep the meeting brief but offer the salesperson the opportunity to provide feedback. Though, don’t let this turn into a negotiation, and by all means, keep your decision final. Wrap up the termination meeting by offering words of encouragement about their future, and of course, wish them the very best.

Whether or not you decide to offer a severance package to the employee will most likely be contingent on established company policies. If everything was clear when they were hired, the issue of severance shouldn’t be a problem. It is also very important for the company to be fair and make certain that all income and commissions are paid promptly. Clearly communicate how and when all monies owed will be paid. Ideally, a check should be given before the employee departs.

The impact of a termination can be profound for a sales team. It is a sales manager’s responsibility to minimize the negative effects and create a plan to productively move forward. Familiarize yourself with the fired salesperson’s accounts, and notify them by phone, not email, of the termination. They must be reassured that the transition will be seamless, and that no balls will be dropped. Ideally, senior management should initially accompany the new salesperson to appointments with key accounts. If a salesperson has yet to be hired, a manager might need to handle the accounts during the transition period.

Inevitably, other employees will be curious about the termination and will want to know how the situation will directly affect them. To minimize gossip, announce the termination promptly. Don’t let there be time for rumor and conjecture. Explain the reasons for the termination to the team, but don’t go into great detail. Reassure everyone that the company is growing and that there is still job security.

If a new salesperson is not hired as a replacement, accounts will have to be divided up among the remaining salespeople. Do this fairly while always keeping a watchful eye that no account becomes ignored. Whether you divvy them up by territory, competency, or industry, the goal is to service the customer.

The road leading to firing an employee is always a little bumpy but can be navigated without a head-on collision. With advanced planning, a level head, and optimism for the future, a termination can ultimately be a good thing for all involved. The fired employee can move on to a more fitting opportunity, the employees can renew their focus, and customers can receive better service.

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