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Article Excerpt
After a string of difficult years for the metals industry, service center salespeople finally are getting their just rewards. Data from the latest Metal Center News Sales Compensation Survey reveal that average total compensation for inside and outside salespeople increased well over 20 percent last year--not surprising considering that average service center revenues more than doubled, along with the price of many steel products.
Sales compensation in the metals distribution industry saw little or no growth in the 2000-2003 period. With the economy and the metals industry fighting their way out of a slump, salespeople had to work harder simply to break even. Just as commission-based earnings declined when service center revenues foundered, sales compensation has jumped dramatically along with service center sales and profits.
Companies responding to MCN's survey ranged in size from a low of $250,000 in annual sales to a high of more than $3 billion, employing from a handful to more than 5,000 workers. Their annual revenues averaged $166.8 million in 2004, more than double the previous year's $75.7 million, reflecting the incredible run-up in metals pricing and the U.S. economy's turnaround.
Two out of three respondents to the survey predict their sales will increase further in 2005 by an average of 12 percent. Averaging all the respondents' forecasts, MCN projects that service center sales will increase by at least 6 percent this year, promising further growth in the compensation earned by many metals sales professionals.
The typical service center today (measured in terms of the median, the midpoint at which half the responses were higher and half lower) is a $22 million enterprise with 45 employees, including 8 salespeople who each generate about $2.5 million in annual sales.
Though compensation varies by region and company...
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