If you are managing an organisation or employees in the SaaS industry, it’s important to deeply understand the implications of why so many sales reps are quitting.
Aside from being offered a better job opportunity, there are other reasons that support an employee’s decision to quit. In this blog, we address some key reasons that might go unnoticed by management teams.
5 Reasons Why Sales Reps Are Quitting In 2022
1. Equity at technology, media and telecommunications companies is down 50-90%
The value of public SaaS companies appreciated massively during Covid-19, peaking in late 2021. However, this has since dramatically decreased, as the past six-month period has been the most significant in terms of value destruction in the history of public SaaS.
A few factors have contributed to this precipitous and unprecedented fall. These include:
- Rising interest rates.
- The end of the Covid-19 ‘sugar high’.
- Inflation and macroeconomic risks.
- The Russia and Ukraine war, and other geopolitical risks.
The consequence of this is creating a huge pay cut for sales reps.
2. Covid-19 was a sprint for pandemic winners
Many companies were unable to maintain the exponential growth levels in 2022 that they experienced in 2021.
SaaS multiples initially crashed during the onset of Covid-19 but came roaring back through the surge of the SaaS industry. There was a significant (and valid) exuberance around high-growth SaaS stocks, given the potential for an increase in IT budgets and revenue for these companies, as every company – regardless of industry – needed more software to serve their end-users and customers in a new digital era.
This ‘sugar high’ seems to be ending even though IT budgets are stronger now than they were in 2020.
3. Now Sales reps have to work just as hard, but for less money
The change in easily sourcing strong leads has become much harder in today’s market. Sales reps are now faced with low-quality leads and much longer sales cycles – making their jobs harder and demotivating, with less commission.
4. Subpar comp and benefits
In a competitive job market, subpar compensation and benefits packages just won’t cut it. Top sales reps know they can do better somewhere else.
According to the Sales Happiness Index, 43% of salespeople who want to leave their current job cited a lack of benefits and 31% cited a lack of bonuses. Additionally, six in ten salespeople would be motivated to leave their company for better benefits, while 51% would be motivated to leave for higher pay.
5. There are more opportunities in the job market
The job market operates the same way as the economy: when demand exceeds supply, the supplier has the upper hand. In this case, the ‘supplier’ is the sales rep, and the demand is coming from companies looking to hit their sales goals by hiring talented sellers.
Not only are there a record number of job openings currently in the market, but companies are also going above and beyond to recruit, offering excellent compensation packages, equity, and benefits. For a salesperson, it’s a great time to make a switch. But if you’re an employer looking to hire salespeople, you will be faced with a competitive recruitment process.
Companies that help salespeople spend more time selling and less time doing administrative work will not only be able to retain their best employees, but they’ll also get an edge on their competition.
Salespeople who feel under-compensated know that they’re in demand, and many are not willing to wait around for things to change.
Do you need help recruiting top talent for your sales team? Ingenio can help you source leading candidates, even in the current employee-driven labour market.
Add your details to the form below and one of our team members from Ingenio will be in touch within 24 hours.