Do You Have a Great Producer? How Do You Pay?

[todd02]

If you had a producer that had ambitions to go out and start their own agency, and you knew that they could... How would you incentivize them to stay with you, yet still make a smart business decision?

I was thinking a nice base, 30k and then 60/40 split with base fading to 24k yr 2, 18k yr 3, remains 12k every year.

I was told that I should only offer a 30% split on renewals due to overhead costs and still providing salary. What do you think, would 40% put my overhead to high if I'm still providing them a lot of leads, a csr to help them service and office overhead?

 

[insurance1822]

That's a tough call. Remember this though..you may know he can start his own agency but he may not know that. Offering 40% renewal while still providing leads & a freaking CSR is like letting him run an agency while you provide the overhead. Of course Farmer's (or any captive) manager wants to get paid by bringing on a new agent so they'll piss in your cheerios all day so maybe this guy could pull it off. But he still needs capital to do so etc.

Any numskull can work leads all day & I wouldn't pay that kind of money for a captive producer. Now you can run numbers & maybe you can still make money on that with bonus but I'd say eff that. If he thinks it's that easy to open an agency let him go do that. If he somehow goes Indy you better pray you have a good no compete. Strong arm him now into signing an extended non compete because you gotta CYA regardless where he goes.