What Do I Pay This New Employee?

[Ibrahim Hughes]

Greetings and happy New Year everyone. I'm looking to hire an acquisitions manager (AM) for my acquisition team. This is the first member who will be paid a salary as opposed to the other team members I have who work strictly on commission ( this will also be the first time I hire an ATM who isn't aspiring to eventually be a real estate investor. I want this person to strictly focus on their job / career as an acquisitions manager and nothing else ). So obviously the commission rates will be different. My question is, how do I determine a good pay for this person. This person will exclusively be making phone calls and door knocking to get sellers under contract. Once the AM is fully up and running I am expecting him/her to lock in a deal once a week ( we wholesale and Rehab). What would you guys pay as a salary? Average wholesale fee we earn is $15,000. Thanks in advance.

[Marvin McTaw]

@Ibrahim Hughes a lot depends on the area and how you plan for this person to work. I've done everything from straight commissions of 20% of net revenues to $20/hr. We currently pay our lead managers $20/hr plus 5.0% commissions so that they make money on the upside. It also helps them to stay firmer to our Max Offer numbers because they realize it impacts their bottom line. 

A few additional suggestions: don't put all your eggs in one basket hiring one acquisitions manager right awa. I'd encourage you to audition multiple acquisitions managers instead of just hiring one. Have them place lots of phone calls before they even start formally working for you to get an actual idea of what you want them to do. Many of them will self-select themselves out or prove themselves to be terrible at the job. 

I'd also encourage you to moderate your expectations. It will take them far longer than you potentially expect for them to become productive. Place the emphasis on what they can control (offers delivered to sellers) instead of actual contracts produced for your wholesale business to sell. Hope it helps!  

[Ibrahim Hughes]

Hey Marvin! I really appreciate the input. Great suggestions!  I also asked this question on Facebook and got some great answers. Leaning towards full commission with some type of Advance Cash payment at the signing of every contract. That way the team member doesn't have to actually wait for closing to have some cash to live on. It also gives them an incentive to get contracts signed as we have a pretty high rate of converting them into close deals. Will definitely keep in mind your suggestions regarding my expectations. In other words "patience my brother". LOL.