It’s a frustrating, often scary situation. Sales have been flat and the cost per head has gone up. The finance department wants to cut your sales team’s headcount to save money.


Demanding that your headcount stays the same is not an option. But neither is losing sales reps. You just need more time to make your sales team profitable again.


You have the power to protect your sales team, even after a slow quarter. Take these five steps to protect your headcount.


1. Make a Business Case

Educate yourself on the broader business context. If the company is public, ascertain the impact of headcount on earnings per share. If the company is private, gather the EBITDA and assess the impact.


Before walking into the CFO’s office, know the business case for your team’s headcount. Be prepared to defend it from a strategic point of view. The CFO is more likely to listen when you can make a strong case.


2. Know Your Numbers

Go back to your sales revenue plan. Review it thoroughly so you have answers ready. Know your productivity per sales rep. Know how sales commissions have risen and fallen.


Go into this as if it were a big-deal signing call. Have all the numbers ready.


We created a Headcount Assessment Tool to help you understand the numbers behind your current headcount. 


Feel free to download and start using the Headcount Assessment tool here.


3. Understand Functional Dependencies

Determine recruiter performance. Have there been changes in the recruitment process? Talent quality may have been an issue, but it doesn’t have to continue. It may be time for an outside recruiter to come in.


This might be where you have a discussion with HR. Look for opportunities here to improve the process of recruiting talent.


4. Do a Deep Dive on Marketing

Whether you own the marketing team or not, it helps to understand marketing spend. Find out what marketing spent this year relative to last year. Uncover what worked and what didn’t.


Sales has a direct correlation between headcount and sales revenue – marketing may not. Compare your sales statistics to marketing statistics.


It might make sense to suggest that marketing dollars get cut before sales headcount. Of course, approach this delicately. Following tip #1, make a strong business case while presenting this option.


5. Make the CFO an Ally

Armed with the information from points 1-4, approach the CFO as a thinking partner. Collaborate instead of going on the defensive. Acknowledge the problem and ask for help uncovering alternatives to losing headcount. This will show that you are a balanced leader.


You Have the Upper Hand — Seize the Opportunity

No matter how sticky this situation is, you can use it as an opportunity.


Look at your sales process and talent pool. Sometimes finding the right sales rep takes time. Finding the right person always makes financial sense. Turnover costs an average of six times a sales rep’s base pay. And you know how to increase sales – you add better sales reps.


Now is the opportunity to point to improvements in your process. After all, a sales rep can show direct revenue generation. You just need time to find sales reps that generate more revenue.


With the right information at hand and the right attitude, you have power. The power to sway the CFO, and the power to protect your headcount.


Matt Sharrers

Leads the firm's focus on the CEO’s role in accelerating revenue growth by embracing emerging best practices to grow revenue faster than the industry and competitors. 

Matt Sharrers is the CEO of SBI, a management consulting firm specialized in sales and marketing that is dedicated to helping you Make Your Number. Forbes recognizes SBI as one of The Best Management Consulting Firms in 2017.


Over the course of nearly a decade at SBI, Matt Sharrers was an instrumental early partner guiding SBI as the Senior Partner. Matt’s functional responsibilities included acting as the head of sales where he led SBI’s double-digit revenue growth, and was responsible for the hiring function to build SBI’s team of revenue generation experts.


Prior to joining SBI in 2009, Matt spent eleven years leading sales and marketing teams as a Vice President of Sales. Matt has “lived in the field.” As a result, he is the foremost expert in the art of separating fact from fiction as it relates to revenue growth best practices. CEOs and Private equity investors turn to Matt’s team at SBI when they need to unlock trapped growth inside of their companies.



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