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If you want to run an exceptional music store, you need motivated employees.
Many workers are driven by a paycheck alone, but in some roles, additional incentives inspire staff to perform at a higher level. In the realm of retail sales, for example, the most common incentive is sales-based commission. But there are other types of rewards you can offer staff, too, based on your business, budget, and number of employees.
Even with a limited budget for staff rewards, using a strategic compensation system helps music store owners keep their staff engaged on the floor — improving their performance and increasing sales revenue.
In this blog, we’ll discuss four employee incentives for musical instrument sales so you can get the best work out of your team.
4 Staff Incentives To Boost Music Store Sales
Offering incentives to your staff has a strong effect on their motivation and behavior. Remember there are multiple kinds of rewards — some involve a direct financial payment while other rewards are non-financial. Let’s take a look at a few top incentive types.
1. Sales Commissions
A commission is an amount a business pays an employee based on revenue from their individual sales. For some businesses, this amount is a simple percentage of individual sales made, while others have a more complex system with many variables at play.
At a music store, staff may make a different commission rate for instrument purchases than for services like repairs or lessons. Some stores introduce multiple tiers: a higher threshold of sales volume would earn a higher percentage than a lower revenue total.
Some compensation plans are based on goals. When an employee meets a certain predetermined target, their percentage increases, motivating them to hit that metric specifically. These goals can be adjusted to be higher during especially busy months or lower during slower times to account for seasonal changes.
Additional Commission Policies
Consider setting commission policies to keep your store profitable. Discounted items, for example, would earn a reduced payout. And if a customer returns an item, a salesperson typically loses their payment.
Knowing this is the case prevents staff from pushing a product on a customer that isn’t a good fit. Losing a payout after a customer cancels a purchase is known as a clawback.
To manage clawbacks, wait to pay an employee commission until a return window closes. If you allow customers to bring their instrument back for a refund within 30 or 60 days, wait to send the payment until that point.
Complicated compensation systems can become confusing for employees. To effectively motivate your staff, compensation policies need to be communicated clearly, and published somewhere that employees can look back on.
Staff members may have questions or concerns about their payouts from time to time, but if the rules are clear and followed, no one will feel slighted.
Related Read: POS Training for Music Store Employees: 6 Tips
2. Bonuses
While individual commissions increase employee motivation, the competition they create among staff can lead to conflict. One way to reduce this is to offer team bonuses based on the entire sales staff meeting collective goals.
Bonuses are often paid monthly or quarterly. When staff know they’ll only earn the reward if the entire team reaches a certain goal, they become less individually-focused and more encouraging of other employees’ efforts. This goal might be based on revenue, profit, lesson enrollments, or repair intake.
You may choose to base a bonus on a certain sales threshold — either the team earned their reward, or they didn’t. Or you can add nuance to the goal: 90% of the goal earns a partial payout, 100% is the full reward, and 110% earns a “kicker,” or an extra financial incentive for exceeding the goal.
If you choose to offer a team reward, keep them on a consistent schedule and be clear about who qualifies for the payout and what amount or percentage the payment is. If the money comes in late, low, or doesn’t show up at all, employees notice — which could lead to a loss of trust.
Related Read: Musical Instrument Repair Pricing: Labor, Parts, and Profit
3. SPIFs
A SPIF (sales performance incentive fund) is a short-term, strategic incentive for salespeople, typically for a specific item or category. Maybe you got a large shipment of guitars recently and they aren’t selling as quickly as you’d hoped. You might offer a small reward to whoever can sell the most guitars over a week.
Rewards for SPIFs might come in the form of:
- Cash
- Gift cards
- Prizes (could be a musical instrument)
- Store credit
SPIFs are designed to increase employee effort over a limited time frame. Some last only a few days or weeks, while longer campaigns might last 1-3 months. Make sure your staff knows when a contest like this ends to create a sense of urgency.
4. Recognition
Employees want to feel that the work they do matters — especially when they achieve a goal. Recognizing team members is a low-cost (or no-cost!) way to show your gratitude.
You might have an “employee of the month” based on who is consistently providing great service to customers and bringing in revenue. Place the employee’s photo on the wall or do a shoutout on your social media page. You might include a small perk like a good parking spot, lunch, or a gift card.
If someone is mentioned by name in a five-star review or you notice them going above and beyond for a customer, give them kudos in a team meeting. When staff members feel their behavior is noticed and valued, they’re likely to continue these behaviors.
Related Read: Training New Employees: Getting Non-Musicians up to Speed
Reward Your Team and Boost Music Store Sales With Music Shop 360
High-quality incentives for your employees leads to greater motivation and better performance. Popular financial rewards for retail sales staff include commissions, bonuses, and SPIFs. While they require an investment, the boost in revenue they create leads to a substantial return.
Beyond financial compensation, remember to take steps to recognize employees for their efforts. Highlight great sales performance and customer service to make team members feel appreciated.
Executing financial incentive plans requires precise tracking and consistent processes. Digital tools have made these operations easier, and some point of sale (POS) systems have features to help you reward your staff.
Music Shop 360 is a cloud-based POS solution built specifically for music stores. Our software is equipped with a variety of integrated tools to help you run your store — including music staff incentive management.
Every online and in-store transaction is tracked in Music Shop 360 — and reports can be generated and customized according to your business’ needs. You can view revenue by employee and create payouts with customized rules for product and service categories. You can also manage commissions on discounted items to protect profitability.
To see what Music Shop 360 can do for your music store, schedule a live software demo today!
