Sales Leaders brace for 2009.

After years of unbroken growth in revenue and sales staff, sales leaders are tightening their budgets for 2009. “Looks like sales management spending is going to be under house-arrest for the start of 2009,” said David Cichelli, consulting editor of the 7th annual Sales Compensation Trends Survey and author of McGraw Hill’s Compensating the Sales Force. Sales leaders are adjusting to the economic contraction by limiting expenses and putting a focus on achieving revenue objectives.

In the recent past, major corporate sales leaders would anticipate a 10% (median) annual revenue growth for the coming year. However, sales projections for the 2009 fiscal year are down substantially to 5.0%, a 50% drop. And, 2008 actual median sales growth of 6.0% was a drop from 8.0% for 2007, a 25% decline. If a major economic downturn continues into 2009, Cichelli reported, over 34% of the companies expect 2009 sales results to slide greater than 10% from their 2008 levels. Sales leaders from over 180 corporate sales entities, with a combined sales force headcount of over 150,000 sales professionals, provided 2009 sales perspectives in the 7th annual Trends Survey conducted by The Alexander Group, Inc.

Additional survey views for 2009 include:

4.4% is the average incentive pay increase planned for 2009. Growth in staffing will be down 39% this year. For 2009, 78.14% of all companies will use sales revenue as the primary performance measure. And, 91.53% of reporting sales departments have made reaching and exceeding sales revenue expectations the most important objective for 2009. 93.44% of the reporting companies will make changes to the 2009 sales compensation plan to ensure alignment with 2009 objectives.

Survey participants include 3M, DuPont, FedEx, Fifth Third Bank, GE, Hormel, HP, Microsoft, American Express, ADP, Kraft Foods, Johnson & Johnson, Oracle, Cardinal Health, Grainger, Bosch, Siemens and many other corporate sales entities.

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