Looking at staffing-yikes!

emsywoo123

So, looking at a possibility here. Facts:

• Registered as Sole Trader
• Started appox 1 month ago
• Business is selling stationery to other businesses (leads generated by telesales)
• Found out 2 weeks ago I am pregnant

I really really would like to have some sort of telesales team. Questions:

• I assume they would have to be self employed as I am sole trader?
• Can I look at agency staff? Or would I have to be Ltd Co?
• I am home based-is it reasonable that telesales people might want to work from home? Not mine-their own :rotfl:
• Can I ask people to work on a commision base rather than salary/wages?

Yikes I think that is all I need to ask for now Will put this on 2 boards to get a good response base thanks

Premier_2

In answer to your questions:

1. You can employ them, even though you are not a limited company
2. You could look at agency staff, not sure if an agency would be prepared to entertain you though. But you can ask. The agency will want to ensure they, or the staff they supply depending on set up, will get paid for the work done.
3. You could ask staff to work from their home ... but you will lose a lot of control of what they are or are not doing. You'll restrict the number of possible applicants by expecting them to work from their own home.
4. You can pay based on commission, but if they are employed by you, you'll need to ensure they earn at least NMW. Same goes for agency staff.

emsywoo123

Premier wrote: »

In answer to your questions:

1. You can employ them, even though you are not a limited company
2. You could look at agency staff, not sure if an agency would be prepared to entertain you though. But you can ask. The agency will want to ensure they, or the staff they supply depending on set up, will get paid for the work done.
3. You could ask staff to work from their home ... but you will lose a lot of control of what they are or are not doing. You'll restrict the number of possible applicants by expecting them to work from their own home.
4. You can pay based on commission, but if they are employed by you, you'll need to ensure they earn at least NMW. Same goes for agency staff.

Thank you for this, really good info.
With regards to point 3, if i am paying commission only, then I am assuming I do not mind what they do or do not do?
And point 4, if they are not employed by me, then I assume they do not need to earn NMW?

Premier_2

Hmmm...wrt point 3, you surely want them to be bringing in work else why have them involved??? If you don't control what they do, they may decide to go into competition with you or perhaps decide to have all orders going through them with say a 50% mark-up. Lots of more complicated and profitable scams would probably be possible too.

Wrt point 4, yes if they are self employed, then NMW does not apply.

emsywoo123

Premier wrote: »

Hmmm...wrt point 3, you surely want them to be bringing in work else why have them involved??? If you don't control what they do, they may decide to go into competition with you or perhaps decide to have all orders going through them with say a 50% mark-up. Lots of more complicated and profitable scams would probably be possible too.

Wrt point 4, yes if they are self employed, then NMW does not apply.

Well my thinking was, on point 3 that they get paid commision on converted leads? Does that make sense?
So they make calls, get a lead, if they can convert it then they get paid.
I give them the prices etc, so they would not be able to take orders?
I do not think I am making any sense.:eek:I know what I mean. Right

• Telesales staff make calls
• One gets a possibility, offers a quote.
• I give quote to telesales staff
• If converted to order, they get commission on profit.

Does this sound like a load of old rubbish?:D

Premier_2

What if they get offered 3 months work on a fruit picking farm for a guaranteed wage? You don't get any orders for 3 months.

So you get another person to help ... and another...and another. Say you end up with 10.

Now Christmas is on the way and you've managed to just about tick over til then. The staff you have on commission have run out of other work and need money for christmas so all hit the phones for you. Suddenly your t/o increases by 10 fold or more overnight; could you cope with the demand?

Regarding your scenario, lets put it this way:

• Telesales staff make calls
• One gets a possibility, offers a quote. (of say £500)
• I give quote to telesales staff (of say £300 - telesales staff confirms order at £500 to customer)
• Customer pays the telesales staff, forwards the £300 to you on which they get commission on profit... and pocket the £200 difference the customer was quoted and paid.

Unless you are in control, don't think you can simply take the leads from the telesales staff & deal direct promising them any commission; the staff will find a way to get the customer to buy the order off them if there is the possibility of ripping you off.

What if that order you quoted for £300 could be purchased for £250 elsewhere and the selesales staff knows that? What would stop them diverting that order to the cheaper supplier without your knowledge? Especially if you only pay say 10% commission? Suddenly your telesales staff member hastheir own business and yourare just a wholesaler to them (and the more expensive option)

Edit: a bit too complicated for a simple telesales operator? Well you are expecting them to be self employed, but lets take a simpler approach.

Someone decides to go into competition with you and knows that you are using a certain self employed telesales person. They approach the telesales person, discover you are paying them 10% commission and so offer 20%. Now a customer calls. Who do you think the telesales staff member will first recommend? You who will sell the goods for £300 earning the TS member £30 or your competitor who quotes £500 earning the TS member a whopping £100.

emsywoo123

Premier wrote: »

What if they get offered 3 months work on a fruit picking farm for a guaranteed wage? You don't get any orders for 3 months. But I do not have to pay them either?

So you get another person to help ... and another...and another. Say you end up with 10.

Now Christmas is on the way and you've managed to just about tick over til then. The staff you have on commission have run out of other work and need money for christmas so all hit the phones for you. Suddenly your t/o increases by 10 fold or more overnight; could you cope with the demand? Yes, this is not a problem, finance ok, and stock no problem

Regarding your scenario, lets put it this way:

• Telesales staff make calls
• One gets a possibility, offers a quote. (of say £500)
• I give quote to telesales staff (of say £300 - telesales staff confirms order at £500 to customer)
• Customer pays the telesales staff, forwards the £300 to you on which they get commission on profit... and pocket the £200 difference the customer was quoted and paid.

Its not exactly what I meant. The customer would not pay the telesales staff, that would be done via here.
My plan (I see you are going to blow this wide open!!:D was say someone wanted a pencil that cost me £100 to buy. (Jeez!) I would tell telesales that is what it would cost, up to them what they charge, bearing in mind the more they bung on the more they will get.
Say they quote at £200, and lead is converted. That leaves £100 profit, i.e. tehy get £30, I get £70 (based on that 30% I mentioned earlier)
Unless you are in control, don't think you can simply take the leads from the telesales staff & deal direct promising them any commission; the staff will find a way to get the customer to buy the order off them if there is the possibility of ripping you off.
There is no way on this planet my supplier would accept orders from wannabes......3 month strict vetting process to be a re-seller for them, and they are Europes cheapest supplier for this industry.


What if that order you quoted for £300 could be purchased for £250 elsewhere and the selesales staff knows that? What would stop them diverting that order to the cheaper supplier without your knowledge? Especially if you only pay say 10% commission? Suddenly your telesales staff member hastheir own business and yourare just a wholesaler to them (and the more expensive option)

Thank you, i hope you do not mind me responding to you?

emsywoo123

Premier wrote: »

Edit: a bit too complicated for a simple telesales operator? Well you are expecting them to be self employed, but lets take a simpler approach.

Someone decides to go into competition with you and knows that you are using a certain self employed telesales person. They approach the telesales person, discover you are paying them 10% commission and so offer 20%. Now a customer calls. Who do you think the telesales staff member will first recommend? You who will sell the goods for £300 earning the TS member £30 or your competitor who quotes £500 earning the TS member a whopping £100.

Yikes you added when I was not looking

I am sure i would have competition, but why would they know someone was working for me? And that is why I am trying to establish a generous but sensible commission rate.
And I would plan for telesales to look after outgoing calls ONLY anyway, so that would not have an impact. It they promote a different company on outgoing calls, taht is up to them, but I would not be paying them?

Premier_2

emsywoo123 wrote: »

.... But I do not have to pay them either?

Yes, this is not a problem, finance ok, and stock no problem

Will it still be no problem if you don't trade for 6 months because there are no orders coming in???

emsywoo123 wrote: »

Its not exactly what I meant. The customer would not pay the telesales staff, that would be done via here.
My plan (I see you are going to blow this wide open!!:D was say someone wanted a pencil that cost me £100 to buy. (Jeez!) I would tell telesales that is what it would cost, up to them what they charge, bearing in mind the more they bung on the more they will get.
Say they quote at £200, and lead is converted. That leaves £100 profit, i.e. tehy get £30, I get £70 (based on that 30% I mentioned earlier)

...There is no way on this planet my supplier would accept orders from wannabes......3 month strict vetting process to be a re-seller for them, and they are Europes cheapest supplier for this industry.

So you are essentially going into wholesaling ... and after 3 months will probably be competing against your own supplier who you claim is the cheapest supplier in Europe. They won't be a wannabe then as they'll have been successfully trading as a self employed business.

Or if that doesn't work, there is always a way for uncontrolled staff to fleece you. If you don't control them, they'll get the £100 pencil cost from you and tell you it's being sold for £101 (times are hard out there and they'll accept the 30p commission) What you don't realise is that the order is coming in via a third party which they own - they actually told the customer it'll cost £200 leaving them with £99 profit from their intermediary company and 30p commission from you. Meanwhile you earn a measly 70p.

emsywoo123 wrote: »

Thank you, i hope you do not mind me responding to you?

No problem,:) just trying to point out the pitfalls if you don't control your own business, or why you think you will compete as a wholesaler when there is a cheaper one already out there, the one you buy from.

emsywoo123

Premier wrote: »

Will it still be no problem if you don't trade for 6 months because there are no orders coming in???

I will still take orders? This is an expansion idea to an already successfully trading business?


So you are essentially going into wholesaling I must be missing the point, as that is not my intention... and after 3 months will probably be competing against your own supplier who you claim is the cheapest supplier in Europe. They won't be a wannabe then as they'll have been successfully trading as a self employed business.

But they will be TELESALES only, they will have no contact with my supplier or have any ability to look at supplier info?

No problem,:) just trying to point out the pitfalls if you don't control your own business, or why you think you will compete as a wholesaler when there is a cheaper one already out there, the one you buy from.

I do not suppose by any chance you have a better idea than I do......I sense there is one on the tip of your typing fingers :rotfl:

If the people I wanted as telesales wanted the sales themselves, they would have to have business premises, pass the stringent checks, have a lump sum of capital upfront, have knowledge of the trade (which I acknowledge they will gain)
If they could do all this, why would they be in telesales in the first place?

Premier_2

emsywoo123 wrote: »

Yikes you added when I was not looking

I am sure i would have competition, but why would they know someone was working for me? And that is why I am trying to establish a generous but sensible commission rate.
And I would plan for telesales to look after outgoing calls ONLY anyway, so that would not have an impact. It they promote a different company on outgoing calls, taht is up to them, but I would not be paying them?

If they are working from their own property, how will you be able to control whether calls are incoming or outgoing?

If they are promoting your competitor over you, you will be happy with that?

And the 'generous commission' you are talking of is based essentially on whatever the person can add to the price they can buy from you at. This may or may not work, but will ultimately fail once you employ more than one salesperson on this basis (as many used car sales places have discovered to their cost who worked on this basis - the customer will just play one salesperson off against the other)