First, if you are understaffed, it means they get more customers than they need to make a living. They don't have to worry about following up or generating lot traffic, there will be another customer for them in a few minutes. The problem is that this situation may help the sales people make as much money as they need while your company could be left earning far less than it's true potential.

Secondly, discipline is impossible when you are understaffed. What are you going to do, fire them? You can't even cover the floor now. Not only is discipline impossible, but many understaffed companies fall into the "I'll hire and keep anyone" syndrome because they are afraid to let anyone go who is covering the floor – even if they are adding very little to profit.

Here are a few tests to see if you are understaffed:

1.  Average Customers Per Sales Person

The most successful dealers around the country seem to do best when they average 2 customers per day per sales person. The number one step in controlling your dealership is to keep track of how many people look at homes each and every day. This is the only way to manage and measure performance. On the average, sales people need about three parties per day to show homes to. That's about 1,000 per year. If a sales person closes at the national average rate of 7%, they would sell about 70 homes per year. If your sales people are averaging more than 3 per showings day, it indicates that your store is understaffed. This may result in the company performing far below it's true potential.

2.  Prospecting Activities

Another important measure of performance is the ratio of customers generated by the staff. Our research indicates that your sales people should average 3 prospects per day. However, we maintain that the company should provide them with 2 of these and the sales person should generate 1 per day from prospecting activities. If your staff does not prospect enough to generate 1/3 of their customers, it is an indication that you are over-staffed and that they do not need to prospect to make a living.

3.  Other Opportunities

Another measure of your staff numbers is this. Are you able to staff your store and still put sales people in trade-shows, malls, park displays etc.? If you are not able to take advantage of these opportunities and man your store at the same time, it probably means you are under-staffed.

4.  Customer Friendly Hours

The fact is that in our industry, most sales are made when the public has time to shop. That means evenings, Saturdays and Sundays. If your store tends to be open Mon-Fri 9 to 5, it is an indication that you are understaffed and are not available to serve the public at hours when they are available to buy. Make sure you are not setting your store hours based on how many sales people you have instead of what is best for the company and the customers.

5.  Level Of Performance

If you see your staff just waiting around for customers and under no pressure to generate new business, get referrals, follow up etc. that is an indication that it is too easy for them to make a living off the "walk-ins". This is usually an indication that the company is under-staffed.

If you determine that you are understaffed, what can you do? Unemployment is at an all time low and recruiting sales good sales people is more difficult than it has been in many years. Newspaper advertisements just do not seem to work for most dealers.

Sales and Management Solutions offers a service to it's clients where it will recruit and train new sales people so you don't need to be understaffed. They find great sales people by electronically scanning almost 1 million resumes on the world wide web and selecting prospective sales people based on background and experience. They send clients the 20 best resumes available every month of candidates who live within 30 miles of your location. This allows clients to always have a pool of good sales people to choose from. They not only find great sales people but they do it for less than the cost of newspapers or any other recruiting method.