5 Considerations When Hiring Sales Reps for Your Dental Lab

There’s a reason you see pharmaceutical and medical device sales representatives whenever you visit any doctor’s office. It’s because companies know relationship building is a critical part of the sales process, and sales reps are experts at fostering those trusting relationships. Sales reps create visibility with your prospective and current clients, and when selling to dentists, visibility is creditability. Unlike other types of marketing, sales reps can tailor their message to address the challenges, and suit the needs, of each dentist they visit. So, if most all other healthcare companies uses sales reps, shouldn’t you use them at your dental lab?

Using sales reps for your dental lab is a great way to get into new territories and ensure your labs value proposition and offerings are being personalized and conveyed as the solution each prospective dentist needs.

The answer is, of course, most likely, yes. But if that’s the case, why haven’t you already hired sales reps for your dental lab, or the ones you hired not work out as planned? The answer might be an easy one. As a lab owner, you’ve always been technically minded, trained and focused on “how to do the work” and you’ve seldom thought about, or focused on, “how to sell the work.”

Here’s the good part. You’ve already invested the money and energy building your lab. You’ve invested in the latest technologies, hired and trained great technical and customer service teams and are up-to-date on the most current techniques. Now adding sales reps is the final piece of the puzzle.

"You’ve already invested the money and energy building your lab ... adding sales reps is the final piece of the puzzle."

Maybe you have already thought about adding sales reps, and maybe even tried hiring a rep or two, but those efforts have failed or not delivered as you thought they would, likely for the reasons I shared above. That’s where I come in.

I'm David, and I grew up in the dental lab industry and worked in my family’s lab, as a technician, for 10 years. I joke that as a technician, “I licked the brush so many times, I could taste the difference between A2 and A3.” After a decade as a technician, I found my true passion for sales. Since then, I’ve held sales and marketing positions and over the past 17 years, started, and sold, two multi-million dollar labs that both achieved their first million dollars in annualized monthly sales in just over their first year.

"I licked the brush so many times, I could taste the difference between A2 and A3."

Achieving that kind of sales trajectory is a challenge for many lab owners who are focused on the technical points of running their lab, but for me its come as easy as matching two centrals is for a good technician. It’s the natural convergence of my decades of dental lab experience as a technician, sales manager and owner, and my passion for sales has given me a leg-up in the dental lab industry. Today, it’s my passion to continue to help other lab owners get the most out of their dental lab. Whether it’s hiring and managing your first sales rep or improving the performance and building on the team you already have.

Actual sales growth of the lab I started in 2014 before selling it in 2018. I can train and coach your sales reps to achieve the same for your dental lab.

With that being said, I'm here to shed some light on some of the most important things to consider before you hire your first sales rep through these five important tips.

1. You Aren’t A Sales Manager, Don’t Try to Be

Most sales rep initiatives fail because the reps are being managed by a lab owner. As a dental lab owner, you aren’t a sales manager, and you shouldn’t try to be one. Having successful sales reps depends on having a successful sales manager - a job that requires time, focus and specialized skill sets.

A lab owner managing sales reps is as good an idea as a sales rep managing technicians - not! Of course that was a joke, but too often reflects the attempts I see by lab owners to hire and manage a sales rep or team of them. In addition to lacking the specialized skill sets, lab owners don’t have enough time in the day for everything they need to do. As a result, owners choose to spend their time in the lab on the functions they like , which are typically the technology, clinical performance and working with their doctors. These are the areas that owners create the most value for the company and where they should be spending their time.

"A lab owner managing sales reps is as good an idea as a sales rep managing technicians - not!"

2. Design Smart Sales Compensation Plans

Creating a compensation plan is cumbersome and requires thought and strategy. Most lab owners use a percentage-of-sales compensation plan which, on the surface, seems like the right idea. The logic is that it rewards the rep the more money they make for the lab so they are inclined to get more business for the most money possible. However, percent-of-sales compensation plans incentivize reps to get the most business for the least amount of money possible.

For example, let’s say the rep won 10 accounts averaging $20,000 per year in business. In one scenario they did not discount the business at all, resulting in $200,000 in annual sales for the lab, in the other they discounted 20% resulting in $160,000 in annual sales for the lab. You can see the total difference to the rep in commission is only $2,000 per year. To be efficient and win the most business possible, the fastest, the rep will almost always lead with discounts.

Reps get paid and lab owners do not. A sales rep being paid a percentage-of-sales commission on $200k a year in sales would only lose $2,000 in commission for discounting the business 20%. The lab however loses while the $40k of sales that would have likely been their profit.

Now consider this. That whooping $40,000 of extra sales the sales rep never tried for, likely represented what would have been the profit on those accounts That said, you can see where paying on a percentage of sales can create what looks like wins, keep the lab busy and rep paid, but can actually be detrimental to a dental labs success and keep the lab owner struggling for cash!

So What’s the Solution?

With all the other information you juggle on a daily basis, you just don’t have the time to come up with a fair comp plan for your new sales rep. I get that, so instead of a percentage-based compensation plan, I’ve devised a goal-centered plan that aligns with the lab’s needs, which are fluid and always changing.

Compensation buckets instead of flat percentage-of-sales commission are a great way to ensure sales rep activities are aligned strategically with the labs goals.

Here’s an example of what I like to call a comp bucket plan:

These buckets will pay reps for new doctors, 90-day new account retention, script count, new product sales, cross-selling, and reactivation bonuses and new territories just to name a few.

When we work together, I will take the time to learn your business, the type of new business development it needs and design the compensation plan with those needs in mind. In this way, we are always aligning the results your reps achieve with the interests of the lab and incentivizing the reps to build the profitable revenue stream you want them to build.

3. Building Phenomenal Sales Reporting is Essential

Your reps need great numbers, delivered in realtime, to be successful and those numbers come in the way of sales reports and, from those reports, sales dashboards. Sales reports must be relevant to the information you, and your reps, require and have the highest level of integrity. Data is key when evaluating your current sales strategy for effectiveness, and efficiency. If your reports lack timeliness, for example, your reps will find it challenging to respond to changes in customer activity and retention trends. There is nothing more frustrating than wasting time on debating and reconciling reports when there are new dentists to win.

Remember, not only do reports give you the numbers you need to make important decisions, but they also aid in the management of your sales rep’s activity. Which brings me to my next tip: CRM’s.

4. You Need Customer Relationship Management Software

Customer Relationship Management Software (CRM) is the single most significant differentiator between reps that deliver extraordinary results and mediocre results. Not only does it affect sales, but also sales team turnover, which can lead to the failure of sales rep initiatives. CRM’s do more than just organize your prospects’ information (addresses, notes, staff names and roles, and contact info), they also work in tandem with proven sales techniques developed for each lab client to make dramatic improvements in winning and retaining dentists.

Properly configured CRM applications like hubspot or salesforce.com (shown) can dramatically improve the management and performance of any sales rep.

The options and configurations for CRM’s are seemingly endless and include sales stages, opportunity tracking, optimized sales and territory routing to maximize efficiency, transparency reporting (so management can monitor reps’ activities), add-ons to integrate with other sales and marketing functions.

Imagine this: Your reps are able to put all of your lab’s qualified clients onto a map that automatically color-codes depending upon recent activity and likelihood of winning business and alerts reps to the most efficient routes to take…all on their laptop or mobile device. With a properly configured CRM, you can double the efficiency and effectiveness of a rep, and I can show you how.

The cost for a CRM can range from free to $300 per-month per-rep. But, when you think about what you’re getting for that money and what you’re already spending on the rep, the added cost will be worth it when you at least triple the rep's sales! Plus, CRM’s, like most software today, are modular and in the cloud, so it’s easy to add new features as your lab grows. Whether it’s me as your outsourced sales manager, you, or an in-house sales manager, anyone can log in, see the reps activity in real-time and work with the reps to help ensure great wins for everyone.

There are many great mapping applications that can be configured to work in realtime with your CRM. When designed correctly, these applications provide visual insight, optimize sales rep territories and routing and dramatically improve efficiency and results.

It can be challenging to understand the differences in cost and features when it comes to CRMs, so when I work with you, I guide you through the options so we can make an informed decision about which software is right for your team and budget.

5. Finding Effective Sales Reps is Overwhelming

If you’ve started the search for the perfect sales rep, you probably feel a little overwhelmed. I’ve seen this happen to a lot of lab owners, so you are not alone on this one. Most owners become so stressed out over finding experienced sales reps that they give up altogether.

So, let me ask you this?

Have you considered hiring reps from another lab, dental supply or related company that already calls on dentists? Well, you aren’t the only one. Many lab owners have tried, or always wanted to try, experienced reps who walk into their lab looking for a sales job. But it is a path that often leads to a dead end. Lab owners without experience hiring and managing reps spend countless hours, days and weeks negotiating comp plans that are out of their budget. Hiring an experienced sales rep without experience managing sales reps, and the solid infrastructure that goes along with it, is like putting the cart before the horse.

"Start taking the same steps you take in "doing the work," to start "selling the work."

By contrast, I strongly believe the only experienced sales person you need is your sales manager. Whether you hire a full time sales manager or hire me as your outsourced sales manager, you will spend far less money and achieve better results, faster than you would if you attempted to build a sales team on your own. When I search for a new sales rep, I look for energetic types who show confidence, drive, and persistence and have organizational skills and authenticity. I, or your full time sales manager, do all the work, comp plans, sales training, reporting, CRM configuration and management, and more. This gives you more time to focus on your expertise and where you add the most value to the lab.

In Conclusion

You’ve built an exceptional lab. You’ve invested in the technology and talent, and have the latest restorations that help and improve the outcomes that dentists achieve. Don’t let the overwhelming tasks of hiring and managing sales reps stop your lab from going to the next level. You’re already outsourcing for different products and services like restorations, design services, accounting or delivery, in order to be competitive.

Start taking the same steps you take in "doing the work," to start "selling the work." It’s the last piece of the puzzle for your lab and the time is now.

Contact me to today and learn how I can help you get starting hiring your first sales rep or improving the performance of the sales team you already have.

Actual lab owner client references are available upon request.