What Is Sales Management?

Textbook Definition

Sales management is the planning, training, measurement, and pay design an owner or manager uses to direct the people who sell on the business's behalf, so their results match the business's goals.

In Plain English

It is how you make sure the people selling for you sell the way you would. Knowing how to manage a salesperson means teaching them what you offer and who it is for, choosing a number that shows sales that actually stuck, paying for that number, and checking it with them every week.

Why Does a New Salesperson Make More Work, Not Less?

Most owners hire a first salesperson, hand over a target, and hope. Hiring feels like passing the problem across the table. But a new hire with no training and a pay plan aimed at the wrong result will do exactly what the pay asks. That is not bad behavior. They are following the only instruction they were given.

Good sales management starts with the middle steps owners skip: training and choosing the number that matters. A sale that gets refunded next week is not a sale. Pay for the ones that stay sold, and your salesperson's best week starts to look like yours.

Signs you have this problem:

  • Your salesperson's numbers look great, but refunds and complaints are rising.
  • Customers arrive expecting things you do not offer.
  • You or someone in the office is up late undoing sales that should not have been made.
  • The only instruction your salesperson got was a target.
  • Pay is based on sales closed, with no link to sales kept.
  • You never sit down with your salesperson to read the numbers together.
A salesperson paid for the wrong number will deliver the wrong number. The fix is not a new hire. It is a clear job and a better number.

What It Looks Like When the Only Instruction Is a Number

From the Fabled Forest · Chapter 19

Commander Colt runs Forest Trails and Tours. He hires an eager hare off the morning ferry, tells him bookings are what matter, and pays him a coin per booking. Three weeks later, the ridge tour that holds twenty-four has thirty-five people waiting, and a family of nineteen hedgehogs is asking where the ice cream is. Colt is at the trailhead handing back coins while his office manager, Greta, stays up past midnight sorting refunds.

Greta's ledger tells the real story: forty bookings in a week, nineteen refunded, twenty-one kept. The hare is not dishonest, he was just never told what the tours are, who they are for, or what to ask. Doctor Owl lays out five steps and points out that Colt did the first and skipped the middle. Greta spends one afternoon teaching the hare the three tours, the questions, a plain close, the written agreement, and how to say thank you when nothing fits. Then the pay changes: a steady weekly wage plus a coin for each booking that is kept, with no penalty for a refund that had a fair reason.

Every Monday the three of them read a new column on the board called Kept. By month's end the hare is booking twenty-two a week instead of forty. Refunds fall from nineteen to two, and kept bookings hold at twenty. His pay is nearly the same, but now it rewards the right customers. Greta gets home by nine again, and two of the hedgehogs come back for the creek tour.

Colt's story is Chapter 19 of Sales for Small Businesses, Book 5 of Dr. Paul's Fabled Forest Business School Series.

The Talon Way: Pay for Closes

The Shortcut

Pay the salesperson for every close, because closers close.

Why It Works for a While

The board fills up fast. Closes are simple to count and simple to pay, and the total climbs every week.

What It Costs

Sales get closed that never should have been, and you pay commission on every one that comes back. The number that rose was not the one that mattered.

How to Manage a Salesperson in 4 Steps

No complicated plans and no software required. Clear instructions, the right number, and a standing weekly meeting.

  1. Write down what you sell before you hire.

    List each offer, the customer it suits, and the customer it does not suit. A new person can only learn what you can put on paper. Then use it to choose well, the way hiring the right employee starts with knowing the job.

  2. Train them in your own steps.

    Walk through the questions, the quote, the close, and the agreement, in order. Plan on a single afternoon side by side to get them going. If your steps are not written yet, build a sales process first so there is something to teach.

  3. Pick one number that shows a sale stuck, and pay for it.

    A kept booking, a paid invoice, or a customer who bought again. Pair it with a steady base wage while they learn. Pay for that number, never punish a refund that had a fair reason, and go over the reasons together.

  4. Read the number together every week.

    Same day, same time, ten minutes. Look at the kept column, the refunds, and why each one happened. Track open deals the same way on your sales pipeline so nothing surprises you on Saturday.

Dr. Paul's Insight

The mistake Dr. Paul sees most is paying for the sale and never checking what happens after it. That setup quietly pays commission on returns. Salespeople who are trained in your methods and rewarded for lasting sales often book less and keep more. If you need help setting up pay, targets, and a weekly review, a fractional COO can build that structure with you.

Sample: Colt's Week, Before and After Before: 40 bookings, 19 refunds = 21 kept. Pay: 1 coin per booking = 40 coins After: 22 bookings, 2 refunds = 20 kept New pay: 18 coins base + 1 coin per kept booking (20) = 38 coins Result: about the same kept customers and about the same pay, with 17 fewer refunds to process each week Cost per kept customer in commission: 40 / 21 = about 1.9 coins before, 20 / 20 = 1 coin after Illustration from the book, in coins. Use your own sales, refunds, and pay plan to run the same comparison.

Watch: Pay, Performance, and Profit

Two videos from Dr. Paul: one on whether high employee pay really means low profits, and a short tip on performance evaluation. Together they cover the pay and the weekly review side of managing a salesperson.

QBP #2 , High Employee Pay = Low Profits… Or does it?

Dr. Paul Borosky, DBA, MBA. (10:54)

Business Plan Writer's Tip #99 for Businesses near Baton Rouge, LA.: Performance Evaluation

Dr. Paul Borosky, DBA, MBA. (3:29)

Read a Passage From Chapter 19

Chapter 19 · Sales Management

Forty Bookings, Nineteen Surprises: A Horse’s Salesman

She taught him the close. She taught him to say it plain, and then to stop: “Would either of those suit you? The ridge, or the creek?” She taught him to put the answer on the page, the one-page agreement, now on every booking, with the number and the date and the line for the signature. She taught him what to do when the answer was neither. “Thank you,” said Greta. “That is all you say.”

“That’s all?”

“That is all.”

“But then I haven’t booked them.”

“No,” said Greta. “You haven’t sold them something that wasn’t for them.”

Read how the new pay plan changes the hare's month in Sales for Small Businesses, Book 5 of Dr. Paul's Fabled Forest Business School Series.

Get the Book on Amazon →

Sales Management Questions Owners Ask

How to manage a salesperson when you have never managed one before?
Start with the basics in order: write down what you sell and who it is for, train them in your steps, pick one number that shows a sale stuck, pay for it, and review it weekly. Most problems come from skipping the training and the number.
Should I pay my salesperson commission on every sale?
Pay on sales that stay sold, not just sales closed. A kept booking, a paid invoice, or a repeat customer is a better measure. Pair it with a steady base wage while they learn.
What if my salesperson earns less under the new pay plan?
They may at first. But if the plan pays for sales that last, a good salesperson usually recovers quickly, and the business stops paying commission on refunds. Explain the reason openly.
How often should I review sales numbers with my team?
Every week, at a fixed time. Ten minutes is often enough to read the kept number, the refunds, and the reasons behind them. Consistency matters more than length.

Written by Dr. Paul Borosky, DBA, MBA, business consultant and author of Dr. Paul's Fabled Forest Business School Series. Want help setting up sales pay, targets, and a weekly review for your team? See growth plan and consulting options.

This page is for general educational purposes only. It is not legal, financial, or other professional advice. Dollar figures are illustrations. The Fabled Forest and its characters are fictional. For decisions about your own business, consult a qualified professional.