Carphone Warehouse ends commission system to improve ‘car salesman’ image

Carphone Warehouse branch

Carphone Warehouse to cease paying commissions to in-branch sales staff. Photograph: Garry Weaser/Guardian

Carphone Warehouse hopes to dispel the image of mobile phone sellers as sharp-suited sharks out to make a sale at any price by ending the practice of paying commissions in all of its UK stores so that staff can give impartial advice to customers.

The company, Europe’s largest independent mobile phone retailer, has been running a commission-free trial involving its 1,300 staff in London since last year and the results have persuaded Andrew Harrison, Carphone Warehouse’s UK chief executive, to roll the practice out across every one of its 820 shops in the country.

“We want to stand out within this market, to be the people who you just know are going to be on your side,” said Harrison. “Customers think this industry has been more akin to estate agency or car salesmen. That is not what our business is built on.

“This industry has also seen a huge growth in network-only stores but they do not give you the full array of what is available. Within this industry there are people who will sell you what makes the most profit for their company, not what is the best thing. Especially in the current climate these are big commitments that people are making and people need to know, and we think they have a right to know, that the people who are advising them are on their side. I want to make sure that we are seen as the paragon of virtue in this market.”

There had been fears within the business that when it launched its non-commission trial in London it would see an exodus of experienced staff to rival firms – some of which have in the past offered large cash bonuses to successful salespeople.

But Harrison said staff retention in London had gone up since it introduced the scheme, helped by a rise in basic salaries from £11,000 to £17,000. The company also motivates staff through what it terms a “net promoter” score. After buying a mobile package, customers are sent a text asking how they would rate Carphone Warehouse to friends on a scale of one to 10. Not having to chase sales has also meant staff have had more time to spend with customers, meaning they can discuss the customer’s needs in more detail and potentially sell them more products.

The move is part of a wider trend within the electronics retailing sector to drop commissions as customers are faced with an ever-more confusing array of devices and technologies. Comet, for instance, has introduced store targets instead.

(source:http://www.guardian.co.uk/business/2009/may/17/carphone-warehouse-ends-sale-commission)

Richard Reid is the founder of Pinnacle Proactive, Specialising in the Employee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit http://www.pinnacleproactive.com

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