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Business scholars, economists or generally clever people; help please trying to sort an international business problem.

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I am trying to find a system that could be used by an international company for ranking sales people by their sales results without having to use exchange rates. Each individual country uses its own c… Read More
kingy58 Avatar
5y, 11m agoPosted 5 years, 11 months ago
I am trying to find a system that could be used by an international company for ranking sales people by their sales results without having to use exchange rates. Each individual country uses its own currency but then at year end the figures are converted into and ranked in Euros as that is the currency used by the Head Office country. The problem is that an individual may have increased their sales dramatically whilst the country's currency could have fallen dramatically against the Euro and vice versa, so not giving a fair result.
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kingy58 Avatar
5y, 11m agoPosted 5 years, 11 months ago
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#1
Surely conversion to Euros at time of sale is the way to go?

After that, any other way is bound to be less accurate and therefore have potentially the wrong person winning.

Edited By: AberdeenDad on Jun 06, 2011 11:29
#2
wont sales / total sales work

i.e. just use percantage
#3
AberdeenDad
Surely conversion to Euros at time of sale is the way to go?
No. Prices, duties and taxes are different in each country and strong currencies have a much more favourable exchange rate against the Euro, than weaker currencies and I'm looking for a system that puts everyone onto a level playing field. I can't decide if a system like this would work: averaging say the top 10 sales personel in each country and then ranking by working out percentage above this average.
#4
You versus me in the UK. You are consistent and sell 10 a month for the year = 120 sales. I am lazy but hit the jackpot in December with my one and only scoring month but it is for 118 sales! I come second in the UK in terms of volume and GBP but when exchange rates are taken into account, I beat you hands down as the rates fluctuated massively in my favour in December.

This is obviously not what is wanted - when looking for the top salespeople it should be you representing the UK and not me.

So what could be done is looking at number of sales (unless they are varying amounts - some of your 120 units were for 10, some were for 15 gbp etc)

If that is not good, what about your sales compared to your colleagues?
#5
Sales are calculated in value not number of orders. So at year end when everybody's sales are converted I would beat you. The fact that your sales came from one big month in terms of volume is immeterial, although as you've earnt nothing for 11 months you would probably have starved to death by the 12th month. I'm thinking along the lines of converting value of sales to a percentage above an average figure (as per my example in post #3). This way exchanges wouldnt come into it.

Edited By: kingy58 on Jun 06, 2011 12:15
#6
My wife earns enough to keep me! (I wish)

That is probably the way to go, though I guess the problem is that if the top 10 are particularly good then that affects the average, and vice versa. In the land of the blind the one eyed person is king - you may sell double what I sell in second place, but I am rubbish and those below me are even worse. We make you look good!
#7
Does anyone else have any suggestions?
#8
Are the goods bought for the same value everywhere (ie in £), or are they manufactured in each individual country ?
#9
BurntEffigy
Are the goods bought for the same value everywhere (ie in £), or are they manufactured in each individual country ?
The selling price varies in each country based on many different factors, plus different products are sold in each countries, with some of the same being sold but at different prices. That particular aspect doesn't actually matter too much as the general range will be similar.

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